4 ms·

Still required by law to pay the difference up to minimum wage. Still only 7.25 but let's be accurate.

• seadan83 4y ago
  Law and practice can often be different. Often "the agreement" is cash tips are not declared on taxes, and you don't hassle the company when you make an hourly shortfall. My impression is that arrangement is far more common than companies actually making sure you get minimum wage every hour.
  • kmoser 4y ago
    The IRS assumes servers get a certain amount of tips, so if you don't report close to what they expect, you run a high risk of being audited.
    • seadan83 4y ago
      True. The loophole is that most tips are on credit cards and hence automatically reported. There is no distinction of cash vs CC tips when reporting. So effectively zero dollars in cash tips is being reported. In the 90s I delivered pizzas for one of the big companies. I raised that if I didn't make tips the company was supposed to pay me $5.50 instead of the $3.25 that was my wage. The boss said, ok, but if we do that then you have to report your cash tips" - the "agreement" was quite explicit