COVID-19 AND THE CONSTRUCTION INDUSTRY

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Tipped Employees Should Always Earn Minimum Wage

Unfortunately, employers will have some struggles moving forward after the fallout of the COVID-19 pandemic. As many employers begin to reopen their business during Phase 1 of Florida’s plan to stimulate the economy, restaurant owners in particular face some unique challenges, including getting their employees to return to work. With the majority of restaurant employees receiving federal unemployment checks, many restaurant workers would prefer not to return to a potentially unsafe work environment. 

Another issue for restaurant owners is whether or not the time and money spent altering their operations to service a limited capacity of consumers (25 percent) will see a profit. Changing the layout of the restaurant, complying with social distancing requirements, and investing in additional resources may create more problems than solutions for restaurant owners right now.

Worst of all, there has been a significant consumer shift to online ordering, food delivery services, and eating in as most consumers fear dining in with the present pandemic. Unfortunately, when you add up all of these issues, the employer isn’t the only person that is impacted. The employees that return to work not only risk their health but also may struggle to make minimum wage. In this article, a Tampa wage and hour attorney will discuss what exactly tipped workers are owed in the Sunshine State. 

Related: Wage and Hour Violations May Increase During Uncertain Times

Wage and Hour Rules for Tipped Workers

Tipped employers in the restaurant industry consist mostly of servers and bartenders. If you are classified as a tipped employee, your hourly wage total may be lower than the standard minimum wage. The reason why is that you have the ability to earn more than the minimum wage through tipped compensation. Here is some more information from our Tampa wage and hour attorneys on exactly how tipped compensation works:

  • The federal minimum wage is $7.25 per hour 
  • In Florida, the minimum wage is currently $8.56 per hour 
  • Florida workers have a right to the prevailing wage in their state over the federal amount  
  • Tipped employees in Florida can earn as little as $5.54 per hour
  • Under Florida law, tipped employees are owed a tip credit of $3.02 per hour. 

In other words, a tipped employee should earn a minimum of $3.02 per hour in tipped compensation to meet the required minimum wage total in Florida. Restaurants can confirm that their employees are earning the appropriate amount of tip credit by calculating the total hourly earnings with the tip credits of tipped workers. The issue is that many restaurants don’t accurately track tipped compensation. In many cases, such as the present, if the total number of patrons is reduced, a tipped employee may not end up earning above minimum wage. 

Understanding Tip Pools

Another issue entirely is that a tipped worker’s earnings in tips are reallocated into a tip pool. In Florida, restaurants can require tipped workers to enter a tip pool, meaning that the total tipped compensation is divided between all of the tipped employees. 

There are a few issues with this process. 

  • In some cases, a tipped worker can earn over minimum wage if they were permitted to keep their tipped compensation but another tipped worker (who failed to earn minimum wage in tipped compensation) essentially splits their total compensation. The end result is that neither worker earns minimum wage. 
  • Some employers wrongfully have non-tipped employees entered into a tipped pool with tipped employees. For example, a hostess or dishwasher may be obtaining tipped compensation when they should not be included in the servers’ tipped pool. 
  • Because of the current social distancing requirements, some tipped employees may not be directly waiting on guests. For example, restaurants are reopening, but the bar area is being used as a service station. Do bartenders earn tipped compensation or minimum hourly wage? 

Many employees are currently performing dual jobs to meet the demand. For example, a dishwasher may wash dishes for six hours and spend two hours delivering food for online orders. Another example is when a server waits tables for four hours and spends four hours restaging and cleaning the restaurant. Is the employer claiming a tip credit for the total time employees are on the clock or only when they are doing tipped tasks?

Final Pointers For Tipped Employees

Generally, the best system for calculating tipped compensation is to avoid tip pools and track every hour an employee works to ensure that their tipped credit is accurate. At the end of the day, the most important thing for tipped workers in restaurants to remember is the following:

  • In Florida, the minimum wage is currently $8.56 per hour. You should earn at least $8.56 for every single hour you work, whether it’s through tips or hourly pay. 
  • If you are a tipped employee and you don’t earn at least $3.02 per hour in tipped compensation, you should be compensated the difference to meet minimum wage requirements.
  • You should always track your hours. You can do this on your phone or by keeping a small notebook with you. 
  • You should be paid for every hour you worked. If you worked over 40 hours in a workweek and you are not exempt from overtime, you should be compensated one-and-one-half times your standard hourly rate.  
  • If your employer fails to provide you with the compensation you deserve, consult a Tampa overtime lawyer

If you would like to speak with our Tampa overtime lawyers, please contact us today.

Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.