In Illinois, employers are allowed to pay commonly tipped jobs, like waiters, 60% of the minimum wage. Please reference the Terms of Use and the Supplemental Terms for specific information related to your state. Illinois employers can pay tipped workers $4.95 an hour, and have tips make up the difference to reach the minimum wage. While Illinois' state minimum wage is $11.00 per hour, Cook County has set its own, higher minimum wage rate that applies to employees of all companies who work within Cook County. That system is called the tip credit. If working the legal holiday or Sunday puts you over 40 hours in a workweek, then your employer must pay you at time and one-half of your regular rate of pay for those hours over 40. Beginning January 1, 2021 - Guarantees a minimum wage of $11.00 per hour for workers 18 years of age and older. Tipped employees, such as waitresses and bartenders, may sometimes be paid a cash wage … The tipped minimum wage, or minimum cash wage, is the lowest amount you can pay a tipped employee per hour of work. The rules about what counts as a tip, how much your employer must pay you, and whether you have to contribute to a tip pool (among other things) all depend on the laws of your state. The law generally considers this part of the contract between the patron and the establishment, not a voluntary acknowledgment of good service by an employee. A waitress spends six hours of her eight-hour shift waiting tables; she spends the remaining time cleaning and restocking the service stations, preparing cold salads and desserts, and making coffee. Salesmen and mechanics involved in selling or servicing cars, trucks or farm implements at dealerships. For Illinois, the minimum wage situation is unique, sharing similar rules to other states, the minimum wage varies depending on where you are located within the state. If the customer pays in cash and tipping is voluntary, whatever amount the customer leaves over and above the charge for products or services (plus tax) is a tip. The tip credit is 40% of the minimum wage. To determine if your primary duties meet the criteria outlined for the executive, administrative or professional employee, visit the, Possibly. An employer may pay a training wage for tipped employees 18 and over in the amount of $6.60 for the first 90 days if applying the tip credit of 40% or $10.50 if not utilizing the tip credit. The following employees are exempt from overtime pay: The law provides that two tests must be fully met to determine if you are an executive, administrative or professional employee. Employees are entitled to earn the full minimum wage per hour as set by federal or state law. Bonus Pay and Severance and Commission FAQ, Day and Temporary Labor Service Agency FAQ, State of Illinois Coronavirus Response Site. Those under 18 years of age may be paid at the rate of $8.50 per hour for less than 650 hours worked for an employer in a calendar year. A minimum wage increase is currently scheduled in Cook County, but until the effective date of 7/2/2021 the state minimum wage rate of $11.00 will apply. The Governor's Budget address will be given at 12pm today. You will need to ask your employer for their definition of a workweek. For more information, visit the, No. Employers may apply for licenses to pay sub-minimum rates to learners and certain workers with physical and mental limitations. Tipped employees must be paid minimum wage, but employers may take up to 40% credit for tips out of the employee’s wages. However, Illinois caps the tip credit amount at 40% of the state minimum wage. *Technically, the Cook County Minimum Wage Ordinance for tipped employees only increases to $5.30. This is called a "tip credit." less in the seven states that have raised the tipped minimum wage to the full minimum wage. If an employee doesn't make enough in tips during a given workweek to earn at least the applicable minimum wage for each hour worked, the employer has to pay the difference. Minors (ages 18 and under) may be paid a minimum wage of $8.00 per hour. Does my employer have to pay me time and one half or double time for working a legal holiday or a Sunday? Plenty of employees in Illinois do, including those who wait tables, serve and mix drinks, open doors, carry luggage, clean hotel rooms, or provide other services, from moving furniture to delivering newspapers. Following passage by the legislature on February 14, 2019, newly elected Governor J.B. Pritzker quickly signed the amendments to the Illinois Minimum Wage … Minors under age 18 may be paid a minimum wage of 8.50 per hour. Do Any Illinois Cities Have Higher Minimum Wages? The employer cannot claim a tip credit for those two hours of non-tipped work because they're not related to the waiter's tipped duties. Employees are entitled to earn the full minimum wage per hour as set by federal or state law. The employer can claim a tip credit for all eight hours of the waitress's shift. Effective July 1, 2020, the Cook County minimum wage will increase to $13.00 per hour and the Cook County base wage for tipped employees will increase to $5.30 per hour. Compensatory time off in place of payment for overtime is not legal in the private sector.​, Wage Payment and Collection Act Penalties. The tipped wage is the base wage for employees who earn tips (such as servers and bartenders). • Increasing the minimum wage to $10.65 per hour, its estimated historic high,16 would boost annual earnings to … For example, if the credit card company charges a 3% fee, the employer could legally reduce the employee's tip by 3% as well. Employers must notify employees of the tip pool in advance. Example. If the employer has to pay the credit card company a processing fee, some states allow the employer to subtract a proportionate amount of the tip to cover the employee's “share” of the fee. In some states, the information on this website may be considered a lawyer referral service. An Illinois employer paying the Illinois minimum wage to tipped employees today is required to pay them at least $4.95 per hour. The poverty rate among women tipped restaurant workers in the seven states that require a full minimum wage with tips on top is 29% lower than in Illinois (14 per - cent compared to 18 percent). Many employers give at least part of these service charges to employees, but that's the employer's choice: Employees have no legal right to that money. The accelerated timeline to a $15 minimum wage, when state law has the rest of Illinois reaching that level by 2025, also squeezes businesses in the midst of … Your use of this website constitutes acceptance of the Terms of Use, Supplemental Terms, Privacy Policy and Cookie Policy. Assuming the employer continues to employ that worker after April 30, 2021 – that worker shall continue to receive the full minimum wage. The Illinois minimum wage was last changed in 2008, when it was raised $3.25 from $7.75 to $11.00. The minimum wage in Illinois is $11.00 per hour for those individuals who are 18 years and older. View using these links: How is the 650-hour limit calculated for youth workers? Copyright ©2021 MH Sub I, LLC dba Nolo ® Self-help services may not be permitted in all states. The attorney listings on this site are paid attorney advertising. Nationally, the base wage is lower, at $2.13 an hour, which has remained the same since 1991. It will reach $15 in 2025. Employers may pay the tipped minimum wage to employees in occupations where gratuities are customarily and usually received and have been recognized as part of the compensation for hiring purposes. Illinois law allows employers to claim a tip credit. Chicago will still have the highest minimum wage in Illinois with an increase to $14.00 per hour on July 1, 2020, and an increase for tipped employees to $8.40 per hour. The primary duties you perform must also be exempt to disqualify you from overtime pay. As of January 2025, the minimum wage for non-tipped and tipped employees will be $15.00 and $9.00, respectively. State of Illinois Coronavirus Response Site. For example, if an employer hires a worker under the age of 18 on April 30, 2020, the window of time to calculate the 650-hour limit runs through April 30, 2021. Yes, unless such work would violate the One Day Rest in Seven Act. A waiter spends six hours of his eight-hour shift waiting tables; he spends the remaining two hours running personal errands for his employer. For the last 30 years, the 80/20 rule has capped at 20% of the employee’s time the non-tipped, related duties an employee may perform while receiving the tipped sub-minimum wage. Illinois is not one of them, however. When you receive tips as part of your compensation, your legal rights under wage and hour laws become a bit more complicated. The DOL’s proposal eliminates the 80/20 rule. Employees over the age of 18, who do NOT receive tips, may be paid $10.50 for the first 90 days with employer. Currently, the federal minimum wage is $7.25 an hour. Employers may not require employees to hand over their tips unless one of these exceptions applies: Minimum wage laws protect all employees, whether or not they receive tips. employees of certain educational or residential child care institutions. For these employees, the state wage is tied to the federal minimum wage of $7.25 per hour which requires an act of Congress and the … As with other issues falling under FLSA, the most advantageous applicable law applies to employees. Because both Illinois rates are higher than the federal minimum wage, employees in Illinois are entitled to the applicable state wage. Do Not Sell My Personal Information, The Essential Guide to Family & Medical Leave. Currently, Chicago’s minimum wage is $14.00 per hour (a lower rate applies to certain small businesses) and Cook County’s minimum wage is $13.00 per hour. Georgia has a state minimum wage law, but it does not apply to tipped employees. It looks like your browser does not have JavaScript enabled. Under a 2018 change to federal law, if an employee performs related non-tipped duties at the same time as—or a reasonable time immediately before or after—performing tipped duties, the employer can take a tip credit for the time spent on those non-tipped duties. Illinois allows employers to credit up to $3.30 in earned tips against an employee's wages per hour, which can result in a cash wage as low as $4.95 per hour. Illinois is set to drastically change its minimum wage in the near future, reaching $15 per hour over the course of the next six years. Tipped employees may be paid 60% of the hourly minimum wage. However, the wages and tips together of a tipped employee must be at least the minimum wage. Please turn on JavaScript and try again. However, employers may pay new employees a minimum wage of $8.75 for their first 90 days of employment. In addition, employees can't be required to pay more into the pool than is customary and reasonable, and the employee must be able to keep at least the full minimum wage. To the extent employees do not fully report their tip income, employees who receive all or part of a service charge won't be happy with this change, either. Arguably the most important thing for both employees and employers to remember is that tipped employees must receive at least the Illinois state minimum wage of $10.00 per hour, whether it is paid by the employer or the difference made up in tips by the employee. On slow days, when tips are not enough, employers are expected to put in the rest. Once a worker reaches that 650-hour threshold with an employer in a calendar year, the employer should pay the worker at least the regular minimum wage paid to those over 18 years of age absent any other exemption that could apply. What is the minimum wage for tipped employees? The Illinois minimum wage as of July 1, 2020, is $10 per hour for non-tipped employees ages 18 and over, which is a fair bit higher than the federal minimum wage of $7.25 per hour. Otherwise, it's a violation. Employees can't be required to share their tips with employees who don't usually receive their own tips, like dishwashers or cooks, unless the employer doesn't claim a tip credit and pays the employee the minimum wage directly. certain employees involved in radio/television in a city with a population under 100,000. commissioned employees defined by Section 7(i) of the Fair Labor Standards Act. Starting in 2014, the I.R.S. Tipped employees must be paid minimum wage, but an employer may take credit for the employee's tips in an amount not to exceed 40% of the wages. Some restaurants tack a “mandatory service charge” on to bills for large tables of diners, private parties, or catered events. executive, administrative or professional employees as defined by the Fair Labor Standards Act. In fact, some employees earn more in tips from satisfied customers than in straight wages paid by their employers. Employers must notify employees of the tip pool in advance. The minimum wage in Illinois is $9.25 as of 2020. For more information, visit the. Any portion of such a charge the employer pays out to employees must be treated as wages, not tips. However, employers may pay new employees a minimum wage of $8.75 for their first 90 days of employment. In Illinois, the 2020 minimum wage rate of $9.25 an hour takes effect on Jan. 1, 2020. After 90 days, the rate must be increased to $11.00 if not utilizing the tip credit. The tipped minimum wage for next year will be $5.55. For more information on this Act, No. See the notice below for more information. You can find out more about Illinois minimum wage, tip rules, overtime standards, and other wage and hour issues at the Illinois Department of Labor. The basic rule of tips, under federal law and state law, is that they belong to the employee, not the employer. Employees over the age of 18, who do NOT receive tips, may be paid $10.50 for the first 90 days with employer. The minimum wage for City contracts or concessionaire agreements is $14.15 per hour, or $7.65 per hour for tipped workers. The minimum wage in Illinois increased in January 2021, for tipped and non-tipped employees. Officials say these workers must still earn the minimum wage after receiving … The $6 minimum wage for tipped workers in Illinois is less than the state’s minimum wage of $8.25 for non-tipped workers, according to the Illinois Department of Labor. Example. Once the employee works more than 650 hours with an employer in a calendar year, they must be paid $11.00 per hour. A recent rule change by the Internal Revenue Service has created a significant incentive for employers to stop imposing mandatory service charges, if the employer hands any of that money over to employees.