Tip Theft
Tipped Employee Lawyers in Philadelphia
Assisting Clients With Tipped Employee Matters
Many Philadelphians earn tips in addition to wages, including bartenders, waiters, entertainers, hotel employees, and other restaurant workers. No matter your position, when you earn tips, your employer must follow specific labor laws regarding your regular wages, the division of your responsibilities, and the handling of your tips.
Unfortunately, many businesses and corporations have developed elaborate strategies to take advantage of and underpay tipped employees. However, Winebrake & Santillo is here to fight against these illegal practices. We help tipped workers assert their rights against businesses that have stolen their wages.
If you receive tips and your employer is stealing from you or not paying you fairly, contact our Philadelphia tipped employee attorneys for a free consultation.
Understanding Pennsylvania’s Tips and Tip Sharing Laws
States and the federal government pass laws that regulate employer responsibilities when it comes to paying tipped workers. Although the Fair Labor Standards Act (FLSA) sets the federal minimum wage at $7.25, it allows businesses to pay employees less if they also receive regular tips and meet certain conditions.
Under federal laws, tipped employees must meet the following conditions to be paid less than minimum wage:
- The employee must directly interact with customers
- Their total monthly earnings must be above minimum wage
- Employers must not share tips with owners, managers, supervisors, or other workers who don’t meet the qualifications of tipped employees
Federal laws also prohibit employers from taking tip credits for any hours spent completing tasks that don’t directly produce tips, such as on “back-of-house” duties or administrative responsibilities. Furthermore, employers who pool tips or take tip credits must also keep detailed records of payroll information, reported tips, and tip allotments.
Understanding Pennsylvania Tipped Employee Laws: What You Need to Know
Pennsylvania’s tip laws have been the subject of much discussion in recent years. In August 2022, the state made comprehensive amendments to its Minimum Wage Act, which had significant consequences for tipped employees.
Key Changes in Pennsylvania's Tipped Employee Regulations:
- Tipped employees must receive $135 per month in tips
- Tipped employees may spend no more than 20% of their weekly hours completing duties that will not result in tips
- Businesses are prohibited from deducting any percentage of tips to pay credit card fees
- Businesses that share tips with non-tipped employees must pay all employees in the tip pool minimum wage or higher
Businesses that charge service fees must notify patrons that these fees do not go to employees and include line items for tips.
FAQs: Understanding Pennsylvania’s Tips and Tip Sharing Laws
1. What is the minimum wage for tipped employees in Pennsylvania?
Pennsylvania allows businesses to pay tipped employees less than the standard minimum wage, as long as the employee regularly earns at least $135 per month in tips.
2. How much time can tipped employees spend on non-tip-producing tasks?
Under Pennsylvania's new regulations, tipped employees cannot spend more than 20% of their weekly hours on tasks that don’t generate tips, such as cleaning or preparing food.
3. Can employers deduct credit card fees from tips?
No, Pennsylvania law prohibits businesses from deducting any percentage of tips to cover credit card fees.
4. Are employers allowed to share tips with non-tipped employees?
Employers can create a tip pool that includes non-tipped employees, but every participant in the pool must earn at least the minimum wage.
5. Are service charges considered tips?
No, service charges are not considered tips. Pennsylvania requires that businesses disclose to customers that service charges do not go to employees and must show a separate line item for tips.
6. Can employers keep a portion of the tips received by employees?
No, both federal and Pennsylvania laws prohibit employers from keeping any portion of employees’ tips or sharing them with managers or supervisors.
7. What records are employers required to keep for tipped employees?
Employers must maintain detailed records of payroll, reported tips, and any tip-sharing or pooling arrangements to comply with federal and state requirements.
8. What happens if an employee’s tips do not bring their earnings up to the minimum wage?
If an employee’s tips combined with their hourly wage do not meet the state or federal minimum wage, the employer is required to make up the difference.
Contact Us for More Information on Tipped Employee Laws
Defending the Rights of Tipped Employees in Philadelphia and Beyond
If a court finds that an employer failed to follow federal and state laws protecting tipped workers, they may be ordered to pay each employee the difference between what they were paid and the federal minimum wage. For example, people who were unfairly paid $2.83 but did not meet tipped-employee requirements may be compensated $4.42 for every hour they worked. Workers may also be entitled to additional damages as a result of their employer’s unfair practices. These penalties can quickly add up to significant sums, especially for businesses that miscalculate the wages of multiple employees.
Contact Our Philadelphia Tipped Employee Attorney Today
Tipped-employee laws are exceptionally complicated, especially when it comes to things like overtime or calculating the wages of workers who fulfill multiple duties for a single business. If you work for an employer whom you suspect has violated your rights, we invite you to contact Winebrake & Santillo to discuss your case. Although we’re based in Philadelphia, we've represented workers throughout the United States.
Call (215) 866-1551 to find out why our Philadelphia tipped employee lawyers have successfully litigated more wage and hour cases than anyone else in the state.
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“Significant experience” - MARTINEZ V. AMAZON.COM SERVS. LLC, 2024 U.S. DIST. LEXIS 209566, *28, *42-43 (D. Md. Nov. 18, 2024)
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“Winebrake & Santillo has a considerable record in employment matters.” - Ricci v. Newrez LLC, 2023 U.S. Dist. LEXIS 186727, at *23 (E.D. Pa. Oct. 17, 2023)
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“Have significant experience in similar matters under the [Pennsylvania Minimum Wage Act]” - Torres v. Brandsafway Indus. LLC, 2023 U.S. Dist. LEXIS 10631, at *8 (W.D. Pa. Jan. 20, 2023).