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Saturday, April 25, 2026

Tip system raises concern for basic wage earners - Cayman News Service

(CNS): Some of Cayman’s lowest-paid workers have complained that employers using gratuities to top up wages to conform with the national minimum wage of $6 per hour are misusing the system. Hospitality employers, such as hotels and restaurants, are allowed to pay workers $4.50 per hour if they also receive at least $1.50 per hour from managed gratuity systems approved by the labour department. But hospitality staff say it is time to close this loophole because they are being short-changed.

At a public meeting Wednesday evening, held by the National Minimum Wage Advisory Committee (MWAC), the issue of how hospitality workers and some domestic staff are paid was raised by a number of attendees who described a litany of issues that this carve-out has caused.

Because employers are dipping into gratuity pools to top up workers’ pay, some are still earning just $4.50 an hour on paper, which means that their pension contributions are based on that hourly rate. In addition, they said, it can be hard to persuade banks to take the part of their pay that comes from gratuities into consideration if they apply for loans and mortgages.

Even where employers, as per the law, only use gratuities to top up basic wages, with the rest being properly distributed among all non-management or supervisory staff, some workers feel that the situation is unfair.

But it appears that in some cases, employers are using tips to top up wages where there is no official scheme and the extra $1.50 is paid...



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