ORLANDO, Fla. — 9 Investigates is looking into where tip money is going and what you need to know about guilt tipping.
For background, here are 9 things to know about tipping in the U.S.:
1. According to CNN, tipping spread in the U.S. after the Civil War as an exploitative measure to keep down wages of newly-freed slaves in service occupations.
2. Critics of tipping argued that it created an imbalance between customers and workers, and, according to CNN, several states passed laws in the early 1900s to ban the practice.
3. The 1938 Fair Labor Standards Act created a federal minimum wage that excluded restaurant and hospitality workers.
4. $2.13 is the federal minimum hourly wage for tipped workers.
5. According to the U.S. Department of Labor, any employee working in an occupation in which he or she regularly receives more than $30 a month in tips is considered a tipped employee.
6. An employer of a tipped employee is only required to pay $2.13 per hour in direct wages if that amount combined with the tips received at least equals the federal minimum wage.
7. According to the Associated Press, tips at full-service restaurants grew by 25.3% in the third quarter of 2022, while gratuities at quick or counter service restaurants went up 16.7% compared to the same time in 2021, according to Square, one of the biggest companies operating digital payment methods.
8. An employer that pays the full minimum wage and takes no tip credit may allow employees who are not tipped employees (for example, cooks and dishwashers) to participate in the tip pool.
9. An employer cannot keep employees’ tips under any circumstances; managers and supervisors also may not keep tips received by employees, including through tip pools
©2023 Cox Media Group