Are Tipped Employees in Ohio Entitled to Overtime Pay?
Some people who work in restaurants, bars, hotels, and other businesses receive tips. If you are an employee who earns tips in Ohio, one of the questions you may have is whether you are entitled to overtime pay. When you receive tips as part of your compensation, your wage and hour rights become a bit more complex. For example, employers of tipped workers can pay them less than the full minimum wage as long as the tips make up the difference. So, are tipped employees in Ohio entitled to overtime pay? Simply put, tipped workers in Ohio who work more than 40 hours during a workweek are entitled to overtime pay. However, how overtime pay is calculated for tipped employees can be complicated, and violations are likely to occur. Read on to learn more.
Minimum Wage for Tipped Employees
For purposes of minimum wage and overtime pay compliance, a tipped employee is a worker who customarily and regularly receives over $30 per month in tips. Examples of tipped workers include waiters, waitresses, bartenders, bellboys, restaurant staff, and bussers. Minimum wage laws protect all employees, including tipped employees. Tipped employees have the right to earn the full minimum wage set by state law. The current minimum wage in Ohio is $10.45 per hour. But, employers are allowed to pay tipped employees less than the minimum wage as long as tips make up the difference. The amount that makes up the difference is known as “tip credit.” However, an employer cannot take a tip credit of more than 50% of the minimum wage. Ohio law requires employers to pay tipped employees at least $5.23/hour for 2024. In a case where an employee does not make enough tips during a given week to earn at least the state’s minimum wage for every hour worked, the employer is required to pay the difference.
Overtime Pay for Tipped Employees in Ohio
Like non-tipped employees, tipped workers are entitled to overtime pay in Ohio. Employers must pay tipped employees who work more than 40 hours in a week overtime for all the extra hours. In Ohio, overtime pay is set at a rate of 1.5 times the regular hourly rate for all extra hours worked.
A vital thing to note is that overtime pay for tipped employees in Ohio is based on the state’s minimum wage ($10.45/per hour) and not the employee’s pre-tip wage of $5.25.
This means that a tipped employee must receive at least $15.68 in overtime wages. An employer may only take 50% of the minimum wage pay ($5.22 in 2024) as a tip credit against this pay. Therefore, an employer must still pay at least $10.46 ($15.68 – $5.22) in base pay for overtime hours worked. Overtime Pay Violations
If an employer fails to follow the correct formula to calculate your overtime pay, you could be entitled to seek compensation for your unpaid overtime. In addition to unpaid overtime pay, you may be entitled to seek liquidated damages. Liquidated damages are set at an amount equal to the owed unpaid overtime wages. For example, if you are owed $235 in unpaid overtime wages, you can also seek an additional $235 in liquidated damages. Liquidated damages are meant to compensate you for the delay in receiving your pay.
Additionally, if you win your case, you may be entitled to coverage by your employer for your attorney’s fees and court costs.
Contact Our Columbus Overtime Wage Lawyers
We understand that the wage and hour laws related to tipped employees can be complex. If you have questions or need a case evaluation, contact our Columbus wage & hour attorneys at the law firm of Brian G. Miller CO., L.P.A.
* This article was written in 2024 using the minimum wages established in 2024. Later dates may result in changes to the minimum wage causing the information above to be outdated. For all potential claims, an individual is encouraged to contact an experienced wage and hour attorney.
Source:
dam.assets.ohio.gov/image/upload/com.ohio.gov/documents/2024_MW_Poster.pdf
