Pennsylvania workers who rely on tips will likely be seeing a significant change in their salaries.
A new law, which went into effect last Friday, Aug. 5, requires Pennsylvania workers to make at least $135 per month in tips before their employers can pay them below the state’s minimum wage.
This change marks the first for how employers pay tipped workers since 1977, and ensures that salaried employees with fluctuating schedules are appropriately compensated for overtime.
“These updated regulations not only seek to keep tips in the pockets of workers who rightfully earned them, but to also ensure employers are playing by the same, fair rules.” Secretary of Labor & Industry Jennifer Berrier said in a statement.
Prior to this new law, tipped workers were only required to earn $30 in tips per month before their employers could reduce their wage from the state’s minimum of $7.25 per hour to the tipped minimum of $2.83.
The updated law also allows employers to take a tip credit under certain conditions, including that the employee spends at least 80% of their time on duties that directly generate tips.
In addition, it allows for tip pooling among employees, prohibits employers from deducting credit card and other non-cash payment processing transactions fees from an employee’s tip left with a credit card or other non-cash method of payment, and requires employers to clarify that automatic service charges are not gratuities for tipped employees.
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