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Tipped Employee Protection: New Wage Calculation Rules

This bill changes how tipped employees are defined, potentially affecting how their minimum wage is calculated. Instead of focusing on whether an employee "customarily and regularly" receives tips, the new rules combine tips with cash wages to meet the minimum rate. Employers will have more flexibility in determining tip calculation periods, which could impact income stability for workers.
Key points
Amends the definition of a tipped employee, focusing on the combined amount of tips and cash wages meeting or exceeding the minimum wage.
Removes the requirement that an employee "customarily and regularly" receives more than $30 a month in tips.
Allows employers flexibility in determining the period for tip calculations (e.g., daily, weekly, monthly).
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Additional Information
Print number: 118_HR_1612
Sponsor: Rep. Womack, Steve [R-AR-3]
Process start date: 2023-03-14