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Server minimum wage

I live in Colorado and was just wanting clarification on the payment for servers. So if a server doesn’t make enough tips to equal minimum wage then the empolyeer must pay the difference. Is that correct? So that no matter what the employee will still have made minimum wage?

Yes, that is correct. Servers must make minimum wage. If they earn tips, some of that money can be deducted from the wage the employer pays.

In Colorado, the minimum wage is currently $7.02 per hour. State law requires that servers be paid at least $4.00 per hour. If the server averages $3.02 per hour or more, the employer can take a tip credit of $3.02 per hour. Suppose Jane works 4 hours and earns $25 in tips. Her employer can pay Jane $4.00 per hour, and take a tip credit of $3.02 per hour. Now suppose Tina works 4 hours and makes only $1 in tips. Tina is entitled to the Colorado minimum wage of $7.02 per hour, which works out to $28.08 for 4 hours. The employer can take only $1 in tip credit, so Tina must be paid $27.08 in cash wages for the 4 hours.

Tips can be averaged over the week or payperiod in determining the hourly wage for servers. But no matter what, the server must make at least the applicable state or federal minimum wage for hours worked. Most servers who do a good job earn well above the minimum wage.

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This entry was posted on Wednesday, September 10th, 2008 at 8:43 am and is filed under
Compensation, Human Resources Management.
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2 Responses to “Server minimum wage”

  1. haley Says:

    I work at a salon shampooing hair and even with tips, i do not make anywhere close to min. wage. Is this the same law as for servers? Thanks

  2. Caitlin Says:

    Hi Haley! Yes, if your salon is covered by the federal FLSA, you are entitled to minimum wage. HTH, and thanks for reading the blogs!~ Caitlin

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