New rules governing tipped wages go into effect across Pennsylvania on Friday, August 5.
The new rules are designed to prevent businesses from deducting credit card fees from employee tips, change how hourly wages are determined, and revise how tips can be pooled and shared with management. This is the first time these rules have been updated since 1977.
Living wages and protections for tipped workers are a racial and gender justice issue. WLP joined advocate partners Community Legal Services and called on the Pennsylvania Department of Labor & Industry to make these changes in a letter sent last year.
As our advocacy partners at One Fair Wage explain, the tipped wage – now $2.83 per hour, it was initially zero dollars – is a legacy of slavery. Black tipped workers are far more likely to report lower wages than their white counterparts. Women represent 66% of tipped restaurant workers and 70% of servers. Restaurants also have the highest concentration of single mothers of any industry.
Many of the rules are designed to prevent employers from engaging in systemic wage theft, a widespread problem in the restaurant industry that contributes to the gender wage gap.
Under the new rules, employers must inform customers if automatically applied gratuities do not go directly to servers and frontline staff and designate an area on the receipt for customers to directly tip server staff. Rules regarding pooled tips – the term for when restaurant staff collect tips across the shift then split the proceeds –clarify that managers and supervisors are not allowed to take a portion of tips unless they provided the entirety of the service to a customer. The definition of tipped workers also changed.
For more details on Pennsylvania’s new rules for tipped workers, see this guide and this FAQ published by the Pennsylvania Department of Labor & Industry.
Women’s Law Project is a public interest law center in Pennsylvania devoted to advancing and defending the rights of women, girls, and LGBTQ+ people in Pennsylvania and beyond. As a non-profit organization, we can not do this work without you. Please consider supporting our work.
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