Part of Ferry's 51-state tip laws guide

Pennsylvania tip laws (2026)

Pennsylvania employers can pay tipped workers $2.83 an hour in cash if tips bring them to $7.25. The worker must earn more than $135 a month in tips. Card fees can't come out of tips, and the state still uses its own 80/20 side-work rule.

Rates as of Last reviewed

Pennsylvania at a glance

Tip credit allowed

Pennsylvania: $7.25 an hour minimum wage. Tipped staff can be paid $2.83 cash, with up to $4.42 counted from tips.

Pennsylvania tip and wage rates at a glance, as of Nov 3, 2026
State minimum wage$7.25/hrStatewide from .[1]
Tipped cash wage$2.83Plus up to $4.42 in tips = $7.25.[1]
Max tip credit$4.42Counted from tips.[2]
Tip poolingAllowedMandatory pools allowed.[3][4][1]
Card-fee deductionNot allowedThe full tip goes to the worker.[3]
Card tip payoutPay out pooled tips by the regular payday for the period.If the amount isn't known yet, pay as soon as practical after.[4]
Local minimum wagesNoneState law blocks local rates.[5]

Rates verified against the Pennsylvania Department of Labor and Industry on . Rates as of . Tipped totals are worked out from the rates above. Download this data (CSV)

02The yes/no sheet

Can you do this in Pennsylvania?

In Pennsylvania you can take a tip credit of up to $4.42 an hour, can require staff to join a tip pool and can't take card processing fees out of tips. Each answer below carries its condition and an official source.

Yes state law allows itNo state law says noDepends read the conditionFederal rule no state rule, federal applies
What restaurant operators can and can't do with tips in Pennsylvania
NumberCan you…AnswerThe condition
01Take a tip credit against minimum wage?YesPay at least $2.83 cash and count up to $4.42 in tips. Tips must cover the gap.[1][2]
02Make staff join a tip pool?YesGive written notice at the employment offer or at least one pay period before the pool starts.[4][1]
03Include bartenders, bussers, runners and hosts?DependsBartender, busser, food runner and host: must customarily receive tips if any participant earns a credited wage; actual supervisory duties can exclude shift leads.[3]
04Include cooks and dishwashers?DependsCooks and dishwashers may join a pool only when every participant receives at least the full $7.25 wage before tips; management remains excluded.[3]
05Give managers or supervisors a share?NoManagers, supervisors and employers cannot receive pool shares. They may keep a direct customer tip only for service they provide entirely alone.[3]
06Let an owner keep any of the tips?NoManagers, supervisors and employers cannot receive pool shares. They may keep a direct customer tip only for service they provide entirely alone.[3]
07Pick your own split (hours, points or percentages)?DependsNo numerical maximum contribution percentage under the incorporated federal pooling rule; participant eligibility and retained-tip wage protections still apply.[4]
08Take card processing fees out of tips?NoThe worker gets the full tip on the slip.[3]
09Hold card tips until payday?DeadlinePay out pooled tips by the regular payday for the period. If the amount isn't known yet, pay as soon as practical after.[4]
10Cover walkouts, breakage or register shortages from tips?NoNot from tips.[3]
11Keep a mandatory service charge for the house?YesYes, by default. Limited to genuine disclosed administration charges; a gratuity added to a bill belongs to the employee under the statute.[1][5]
12Pay tips on a payroll card?DependsVoluntary written or electronic authorization, disclosures, insured accounts, free access and alternative payment protections apply. Offer another way to get paid too.[6]

03State vs federal

Pennsylvania vs federal law

Pennsylvania sets a stricter rule than federal law on 3 of the 10 rules below. Where the two differ, the rule that is better for the worker applies.

Pennsylvania tip rules compared with federal rules (FLSA)
RuleFederal (FLSA)PennsylvaniaComparison
Minimum wageSame as federalFederal$7.25[7]Pennsylvania$7.25[1]Same as federal
Tipped cash wageStricterFederal$2.13[7]Pennsylvania$2.83[1]Stricter
Max tip creditStricterFederal$5.12[7]Pennsylvania$4.42[2]Stricter
Who counts as tippedState ruleFederalMore than $30 a month in tips, customarily and regularly received in the occupation.[7]PennsylvaniaMore than $135 in tips per month.[1]State rule
Managers in the poolState ruleFederalManagers/supervisors meeting the executive duties test cannot keep employees’ tips or receive from pools; they may keep only tips received directly for services they directly and solely provide. No salary-level test is used for this tip restriction.[7]PennsylvaniaManagers, supervisors and employers cannot receive pool shares. They may keep a direct customer tip only for service they provide entirely alone.[3]State rule
Kitchen in the poolState ruleFederalCooks and dishwashers may join a nontraditional mandatory pool only when all workers receive a direct cash wage of at least the full federal minimum wage and no tip credit is taken; employer/managers/supervisors remain excluded. State law may be stricter.[7]PennsylvaniaCooks and dishwashers may join a pool only when every participant receives at least the full $7.25 wage before tips; management remains excluded.[3]State rule
Card fees from tipsStricterFederalOnly the actual proportional credit-card transaction fee may be deducted from charged tips; no deduction exceeding that fee or reducing required minimum wages; state law may forbid even that deduction.[7]PennsylvaniaNot allowed[3]Stricter
Card tip payoutState ruleFederalCharged tips due by regular payday, without waiting for processor reimbursement. Employer-administered pools fully distributed by regular payday for the workweek/pay period; if the amount/distribution cannot be determined before payroll, distribute as soon as practicable afterward.[7]PennsylvaniaPay out pooled tips by the regular payday for the period. If the amount isn't known yet, pay as soon as practical after.[4]State rule
Mandatory service chargesState ruleFederalA compulsory service charge is not an FLSA tip. Amounts distributed to employees are wages that may satisfy wage obligations and must enter the regular rate for overtime. This federal wage classification does not decide contractual or state-law ownership.[7]PennsylvaniaThe business's money, limited to genuine disclosed administration charges; a gratuity added to a bill belongs to the employee under the statute.[1][5]State rule
Overtime for tipped staffState ruleFederalFor covered nonexempt employees, overtime generally begins after 40 hours in a workweek. Use the full regular rate, at least the full federal minimum wage, not $2.13; the hourly tip credit is not increased for overtime. Voluntary tips above the tip credit are excluded; distributed service charges enter the regular rate.[7]Pennsylvania1.5 times the regular rate after 40 hours. The tip credit isn't multiplied by 1.5, and overtime can't be figured from the $2.83 alone.[7][1]State rule

04Wages

Minimum wage and the tip credit in Pennsylvania

In Pennsylvania employers can pay tipped staff $2.83 an hour and count up to $4.42 in tips toward the $7.25 minimum. If tips fall short, the employer makes up the difference.[1]

Worked example

One server, one slow 30-hour week in Pennsylvania

Minimum for the week: 30 × $7.25$217.50
Cash wage you pay: 30 × $2.83$84.90
Tips have to cover: 30 × $4.42$132.60
Tips actually earned$120.00
You top up the gap$12.60
Cash wageTips countedYour top-up

A busy week with $132.60 or more in tips needs no top-up. Every tip above that is the server's. Fictional worker and tips.

Tip credit conditions
Pay at least $2.83 in cash, with retained tips covering the rest of $7.25. Give tip-credit notice and follow the pool, threshold and side-work rules.[1][5]
Who counts as tipped
More than $135 in tips per month.[1]
Overtime
1.5 times the regular rate after 40 hours. The tip credit isn't multiplied by 1.5, and overtime can't be figured from the $2.83 alone.[7][1]
Side work and dual jobs
Pennsylvania keeps its 80/20 rule: supporting work past 20% earns full minimum wage. Unrelated work gets no credit. The federal 30-minute rule doesn't apply.[1][3]

Other rates

Other minimum wage rates in Pennsylvania
RateHourly
Youth or training Approved learners and studentsA special certificate is required; learner and student work limits apply. Rate set by formula: at least 85% of the applicable minimum wage.[5]$6.16*
Youth or training No general lower training wageThe former 60-day training wage cannot be used after July 23, 2009.[1]$7.25

* Worked out by Ferry from the formula, using the $7.25 state minimum wage. Not an official figure.

Scheduled increases

No statewide increase with a published amount is on file as of .

Worth knowing

The $135 line is "more than," not "at least"

A worker needs more than $135 in tips in a month before the tip credit applies.[1][3][8]

05Local rates

City and county minimum wages in Pennsylvania

Pennsylvania law doesn't let cities or counties set their own minimum wage, so $7.25 applies everywhere in the state.[5]

Local rates preempted[5]

06Tip pool

Who can be in the tip pool in Pennsylvania

Pennsylvania allows tip pools, and employers can make them mandatory. Owners, managers and supervisors can't share in them. A tip pool collects tips and splits them among staff; a tip-out is one worker handing part of their tips to others.

Who can share in a tip pool in Pennsylvania, by role
RoleCan share?Condition
Front of house
ServerDependsMust customarily receive tips if any participant earns a credited wage; actual supervisory duties can exclude shift leads.[3]
BartenderDependsMust customarily receive tips if any participant earns a credited wage; actual supervisory duties can exclude shift leads.[3]
BusserDependsMust customarily receive tips if any participant earns a credited wage; actual supervisory duties can exclude shift leads.[3]
Food runnerDependsMust customarily receive tips if any participant earns a credited wage; actual supervisory duties can exclude shift leads.[3]
HostDependsMust customarily receive tips if any participant earns a credited wage; actual supervisory duties can exclude shift leads.[3]
BarbackDependsMust customarily receive tips if any participant earns a credited wage; actual supervisory duties can exclude shift leads.[3]
ExpoDependsMust customarily receive tips if any participant earns a credited wage; actual supervisory duties can exclude shift leads.[3]
Back of house
CookDependsMay join only when all pool participants receive at least the full minimum wage before tips.[3]
DishwasherDependsMay join only when all pool participants receive at least the full minimum wage before tips.[3]
Leadership
Shift leadDependsMust customarily receive tips if any participant earns a credited wage; actual supervisory duties can exclude shift leads.[3]
Manager or supervisorNot allowedCannot receive pool tips; direct tips require providing the entire service alone.[3]
OwnerNot allowedCannot receive pool tips; direct tips require providing the entire service alone.[3]
Managers and supervisors
Managers, supervisors and employers cannot receive pool shares. They may keep a direct customer tip only for service they provide entirely alone.[3]
Owners
Managers, supervisors and employers cannot receive pool shares. They may keep a direct customer tip only for service they provide entirely alone.[3]
Back of house
Cooks and dishwashers may join a pool only when every participant receives at least the full $7.25 wage before tips; management remains excluded.[3]
Who sets the percentages
Employers can require contributions from eligible staff. They disclose the setup in writing with the job offer or one pay period before it starts.[1]
Cap on what a pool can take
No numerical maximum contribution percentage under the incorporated federal pooling rule; participant eligibility and retained-tip wage protections still apply.[4]
Pooling allowed
Yes.[3]

07Put it to work

Setting up a tip pool in Pennsylvania

Under Pennsylvania rules, 6 of the 10 staff in this example can share a $1,200 pool. The table splits the same pool by percentage, by points and by hours.

The law decides who's in. You still have to run the split every shift and pay it out. That part is a math and payout job, and it's the same job whether you have one location or forty.
Saturday dinner pool$1,200.00
6 of 10 staff can share in Pennsylvania
By %
By points
By hours
Servers 67.1%Bar 14.6%Support 18.3%
The same $1,200.00 pool split three ways, using roles that can share in Pennsylvania
WhoBy %By pointsBy hours
MayaServer, 6 h, 10 pts$268.29$250.00$211.78
JordanServer, 6 h, 10 pts$268.29$250.00$211.76
PriyaServer, 6 h, 10 pts$268.29$250.00$211.76
SamBartender, 6 h, 8 pts$175.61$200.00$211.76
LuisBusser, 5 h, 5 pts$109.76$125.00$176.47
AvaFood runner, 5 h, 5 pts$109.76$125.00$176.47
TheoCook, 7 hNot in the pool. Out here: this pool includes servers paid with a tip credit.
KimCook, 7 hNot in the pool. Out here: this pool includes servers paid with a tip credit.
RafaDishwasher, 6 hNot in the pool. Out here: this pool includes servers paid with a tip credit.
DanaManager or supervisor, 2 h (ran food)Not in the pool. Cannot receive pool tips; direct tips require providing the entire service alone.
Total$1,200.00$1,200.00$1,200.00

Fictional restaurant and staff. The guest-facing staff here are assumed to meet Pennsylvania's condition for sharing (see who can be in the tip pool, above). Percentages and point weights are examples, not a recommendation. Shares are rounded to the cent, and any leftover cent goes to the first server. Run your own numbers in the tip pooling calculator.

Support Pool contributors: Server $262.83 and Bartender $54.92, for a total of $317.75. Support Pool receivers, pooled by Day and distributed by Hours Worked: Jonah Kim, Busser, 6.50 hours, +$179.56. Sofia Nunez, Food Runner, 5.00 hours, +$138.19. Total 11.50 hours and $317.75.

Support pool split. Servers and bartenders pay into the support pool, split by hours worked.
Ferry Tip Manager

Ferry Tip Manager: support pool split by hours

Servers and bartenders pay into the support pool, and Tip Manager splits it by hours worked. Each person sees their share, with no spreadsheet at close.

Who it's for Full-service restaurants that tip out bussers, runners and bar backs

Run your own numbersPlug your staff and tips into the tip pooling calculator

08Service charges

Service charges vs tips in Pennsylvania

In Pennsylvania a mandatory service charge belongs to the business by default, limited to genuine disclosed administration charges; a gratuity added to a bill belongs to the employee under the statute. A tip is the guest's choice and belongs to staff.

Tips compared with service charges in Pennsylvania
QuestionOptionalTipMandatoryService charge
Who sets the amountThe guestThe business
Who it belongs toThe worker it was left for, or the poolThe business, by default. Limited to genuine disclosed administration charges; a gratuity added to a bill belongs to the employee under the statute.[1][5]
Can it go to staff?Yes, through the poolYes. Amounts paid to staff are wages, not tips.[7]
How it's taxed (federal)Tip income the worker reportsRegular wages, with payroll taxes[9][10]
Guest noticeNone neededExplain in the contract and menu that the administrative charge is not a staff tip. The bill must show separate service-charge and tip lines.[1]
  1. Step 1Did the guest choose whether to pay it, and how much?
    YesIt's a tip. It belongs to staff.
    NoIt's a mandatory charge. Go to step 2.
  2. Step 2What does Pennsylvania say?Business owns it by defaultThe business, by default. Limited to genuine disclosed administration charges; a gratuity added to a bill belongs to the employee under the statute.[1][5]
  3. Step 3Check the cityNo city service charge rules on file for Pennsylvania.
Menu and receipt notice
Explain in the contract and menu that the administrative charge is not a staff tip. The bill must show separate service-charge and tip lines.[1]
Large-party auto gratuities
A required automatic charge isn't a tip under federal rules. A gratuity added to a Pennsylvania bill belongs to the employee. Labels don't settle it.[9][10][5]

Local service charge rules

No local service charge rules on file for Pennsylvania.

More on the difference: service charge vs tip.

Banquets and events

Banquet charges need clear notice and two bill lines

A genuine administration charge can stay with the restaurant, but only with clear notice. A gratuity added to the bill belongs to the employee.[1][5]

  • Covers banquets, special functions and package deals.
  • The contract and menu explain that the administration charge is not a staff tip.
  • The bill shows the service charge and the tip on separate lines.
  • Amounts paid out to staff are pay, not tips, and count toward overtime.

09Card tips

Card tips in Pennsylvania: fees and payout timing

In Pennsylvania the card processing fee can't come out of a worker's tip; the full tip goes to the worker. Payout deadline: pay out pooled tips by the regular payday for the period. If the amount isn't known yet, pay as soon as practical after.

Card processing fees
NoFull tip, no fee taken.

Pay the entire customer-authorized tip; do not deduct card or other payment-processing charges before individual payment or pool distribution.[3]

When card tips have to land

  1. TonightGuest adds a tip On the card, at the table.
  2. CloseShift is tallied The pool is split by your rules.
  3. DeadlinePennsylvania rule Pay out pooled tips by the regular payday for the period. If the amount isn't known yet, pay as soon as practical after.[4]
  4. Last dayFinal pay Quitting or discharged workers receive earned wages by the next regular payday; send by certified mail if the worker requests it.[11]

Paydays: Use regular paydays designated in advance. Payment follows the written contract; otherwise the customary trade interval or within 15 days after the pay period ends.[11]

Paying tips on a payroll card

  • Allowed?DependsVoluntary written or electronic authorization, disclosures, insured accounts, free access and alternative payment protections apply.[6]
  • Worker consent needed?Yes
  • Free way to get the money?State ruleEach pay period, or weekly if paid more often: one free full net-pay withdrawal and one free in-network ATM withdrawal. Other fee bans apply.[6]
  • Must you offer another option?YesChange as soon as practicable, by the first payday after 14 days from receiving the request and necessary information.[6]
  • Holding cash tipsState ruleThe incorporated pooling deadline covers collected cash tips as well as card tips. Employers may hold them for eligible redistribution, not for their own use.[4]
  • Tips shown on the pay stubDependsStatements show claimed minimum-wage allowances; keep separate tip and pool records, and give written notice when the hourly credit changes.[1]

Alice Anderson, Server, Downtown. Direct tips +$980.25, indirect tips +$0.00, tip outs -$147.07, tips payable $833.18. Tip Payment history, all Automatic with status Success: 2026-10-29 $833.18, 2026-10-28 $783.19, 2026-10-27 $733.20.

Employee tip payout. Each person's direct tips, tip outs, and payable amount, then paid automatically.
Ferry Pay and Pay Card

Ferry Pay: each tip share, paid out digitally

Each person's direct tips, tip outs and payable amount in one view, then paid through Ferry Pay. No cash to keep on hand for payouts. Eligibility and fees apply.

Who it's for Operators who want to stop the nightly cash run

Customer story: BJ's Restaurants
200+locations across 30 states run Tip Manager and Ferry Pay
66%+reduction in cash-carrying costs
“Since launching this card program, we've reduced our cash-carrying costs by over 66 percent”
Jake Guild, Senior Vice President & Chief Accounting Officer, BJ's Restaurants
Read the BJ's case study

10Records

Records and notices in Pennsylvania

Keep each tipped worker's tips and hours on record, shift by shift. Pennsylvania: three years from the last entry for required records.

Pennsylvania State

  • Tip records Maintain hours, wages, tip reports, credit amounts, hours in tipped and non-tipped occupations, and each pool participant’s name, position and distribution.[1]
  • How long to keep them Three years from the last entry for required records.[1]
  • Tip credit notice Required. Explain the tip-credit provisions. Give written notice of changes to the hourly credit and written pool-arrangement notice before the required deadline.[1]
  • Posters and forms Pennsylvania Minimum Wage Law Summary poster; Written tip-pool arrangement notice.[1]

Everywhere Federal

  • Tip records Maintain employee identity, time and pay records. Tip-credit employers additionally retain tipped employee, reported tips, credit amounts and hours/earnings by tipped and nontipped occupation. No-tip-credit employers operating mandatory pools record each recipient and weekly/monthly tips. IRS daily records/reporting are separate obligations.[7]
  • How long to keep them FLSA: payroll records at least three years; underlying wage-computation records two years. Tax retention is separate.[12]
  • Tip credit notice Oral or written notice must state cash wage; tip credit amount; credit cannot exceed actual tips; employee retains tips except valid traditional pool; credit unavailable until informed. Traditional pool contribution amounts also disclosed.[7]
  • A written pool policy Good practice, not a federal rule: who's in, how it splits, when it pays. Share it with staff. How to write one.
For workers

Think your tips were handled wrong in Pennsylvania?

Workers in Pennsylvania can file a tip or wage claim with the Pennsylvania Department of Labor and Industry (800-932-0665). Filing is free, and this page can't settle a dispute; the state can.[8]

Pennsylvania Department of Labor and Industry
Phone
800-932-0665[8]
Website
pa.gov/agencies/dli

Retaliation: Employers cannot fire or retaliate against employees for asserting minimum-wage rights; statutory protections include investigation testimony.[13]

Penalties: Workers can recover unpaid minimum wages, costs and attorney fees. Criminal fines also apply. Late wages can add 25% or $500, whichever is greater.[5][11]

Can they take this out of my tips?

  • Walkouts and dine-and-dashNot allowedEmployer business costs cannot be taken from employee tips; separate wage-deduction rules also apply.[3]
  • BreakageNot allowedEmployer business costs cannot be taken from employee tips; separate wage-deduction rules also apply.[3]
  • Register shortagesNot allowedEmployer business costs cannot be taken from employee tips; separate wage-deduction rules also apply.[3]
  • UniformsNot allowedEmployer business costs cannot be taken from employee tips; separate wage-deduction rules also apply.[3]
  • Card processing feesNot allowedNo credit-card or other payment-processing fee may be deducted from tips.[3]
  • A manager's shareNot allowedManagers, supervisors and employers cannot receive pool shares.[3]

11Law changes

What changed in Pennsylvania tip law, and what's coming

No statewide increase with a published amount is on file for Pennsylvania as of .

No changes to Pennsylvania tip or wage rules on file for the last 24 months.

Bills and ballot measures

  • HB 1549 Passed House June 11, 2025; referred to Senate Labor and Industry June 18, 2025; not enacted.
    Proposes changes to minimum wages, definitions and exemptions. It isn't law, so its amounts aren't used on this page.
  • HB 2189 Passed House March 24, 2026; Senate discharge motion September 30, 2026; not enacted.
    Proposes changes to minimum wages, definitions and exemptions. It isn't law, so its amounts aren't used on this page.

Key statutes

  • Minimum Wage Act sections 3(d), 4, 12, 13, 14.1
  • 34 Pa. Code 231.31-.37 and 231.101a-.114
  • Wage Payment and Collection Law sections 3, 5, 10
  • 1975 Act 173 sections 1.1 and 2.1

Pending bills

Two minimum wage bills passed the House

Neither is law as of November 3, 2026, so $7.25 and $2.83 still apply.[14][15]

  1. Not enactedHB 1549 passes the House Proposes changes to minimum wages, definitions and exemptions.[14]
  2. Not enactedHB 1549 goes to Senate committee Referred to Senate Labor and Industry. Not enacted.[14]
  3. Not enactedHB 2189 passes the House Proposes changes to minimum wages, definitions and exemptions.[15]
  4. Not enactedSenate discharge motion on HB 2189 Still not enacted.[15]

12FAQ

Pennsylvania tip law questions

Plain answers to the 8 questions restaurant owners and staff ask most about Pennsylvania tip law, each linked to its source.

What is Pennsylvania's tipped minimum wage?

$2.83 an hour in cash. Cash wages plus retained tips must reach at least $7.25, and the employer covers any shortfall.[1]

How much in tips before a tip credit applies?

More than $135 a month. Exactly $135 doesn't qualify under the regulation. Notice, pooling and side-work rules also apply.[1][5]

Can a restaurant require employees to pool tips?

Yes, with eligible participants and written notice at the job offer or at least one pay period before the pool starts. Managers and employers can't take a share.[1][3]

Can cooks and dishwashers join the pool?

Yes, when everyone in the pool gets at least the full $7.25 before tips. A pool with any tip-credit worker is limited to customarily tipped jobs.[3]

Can card fees be deducted from tips?

No. Pennsylvania bars card and other payment-processing fee deductions from tips, including before pool distribution.[3][1]

Does Pennsylvania still have an 80/20 rule?

Yes. Supporting work past 20% earns the full minimum wage, and unrelated work gets no tip credit.[3][1]

Is a banquet administration charge a tip?

Not when it is a genuine, disclosed administration charge. Contracts and menus must explain that, and bills show service charge and tip on separate lines.[1]

Can wages be paid on a payroll card without consent?

No. Written or electronic authorization is required, and workers can ask to switch to direct deposit or a check.[6]

13Compare

How Pennsylvania compares with nearby states

Pennsylvania borders Delaware, Maryland, New Jersey, New York, Ohio and West Virginia. Delaware, Maryland, New Jersey, New York, Ohio and West Virginia pay a higher minimum wage than Pennsylvania's $7.25. Running locations on both sides of a line? Each one follows its own state's rules.

Compare all states in one table

The law decides who's in. Ferry runs the split.

See how operators set pool rules in Ferry Tip Manager and pay tips out without a cash run. Bring your own Pennsylvania setup.

14Sources

Sources for Pennsylvania tip laws

Every figure on this page links to one of these 15 sources: 11 for Pennsylvania and 4 for the federal baseline. They are statutes, regulations and government agency pages, each with the date it was checked.

  1. 134 Pa. Code Chapter 231 Minimum WagePennsylvania Legislative Reference Bureau · Official source · Checked Pinpoint: 34 Pa. Code 231.101a(b); 34 Pa. Code 231.101a(a)www.pacodeandbulletin.gov/secure/pacode/data/034/chapter231/chap231toc.html
    What the source says

    “The minimum wage for tipped employees is $2.83 per hour”

    “an employer shall pay at least $7.25 an hour to all employees for all hours worked”

    “Beginning July 24, 2009, $7.25 an hour.”

  2. 2Minimum Wages for Tipped EmployeesUS Department of Labor · Official source · Page updated · Checked Pinpoint: Table, Pennsylvania rowwww.dol.gov/agencies/whd/state/minimum-wage/tipped
    What the source says

    “Pennsylvania $7.25 $4.42 $2.83 $135 per month”

  3. 3Overtime and Tipped Worker Rules in PAPennsylvania Department of Labor and Industry · Official source · Checked Pinpoint: 80/20 Rule, opening paragraph; Tip Pooling, paragraph 2; Tip Poolingwww.pa.gov/agencies/dli/resources/compliance-laws-and-regulations/labor-management-relations/labor-law/overtime-and-tipped-worker-rules-in-pa
    What the source says

    “An employee for whom an employer takes a tip credit cannot spend more than 20 percent of their weekly working hours on duties that do not directly generate tips.”

    “If all employees are paid at least the state minimum wage or higher, tip pools may include both tipped and non-tipped employees.”

    “Tip pools including any employee who is paid a tip credited minimum wage (less than $7.25 per hour) may only include individuals in occupations who customarily and regularly receive tips.”

  4. 429 CFR 531.54, July 1 2022 editionUS Government Publishing Office · Official source · Page updated · Checked Pinpoint: 29 CFR 531.54(b)(1), 2022 edition incorporated by 231.112(a); 29 CFR 531.54(a), incorporated by 231.112(a); 29 CFR 531.54(b)(2), incorporated by 231.112(a)www.govinfo.gov/content/pkg/CFR-2022-title29-vol3/pdf/CFR-2022-title29-vol3-sec531-54.pdf
    What the source says

    “An employer does not violate section 3(m)(2)(B)’s prohibition against keeping tips if it requires employees to share tips with other employees who are eligible to receive tips.”

    “Section 3(m)(2)(A) does not impose a maximum contribution percentage on mandatory tip pools.”

    “if it fully distributes any tips the employer collects no later than the regular payday for the workweek in which the tips were collected,”

  5. 5Minimum Wage Act of 1968Pennsylvania General Assembly · Official source · Checked Pinpoint: Minimum Wage Act 3(d); Minimum Wage Act 4(b); Minimum Wage Act 14.1(a)www.legis.state.pa.us/WU01/LI/LI/US/HTM/1968/0/0005..HTM
    What the source says

    “The additional amount on account of tips may not exceed the value of tips actually received by the employe.”

    “the minimum wage prescribed under this subsection (b) shall not be less than eighty-five percent of the otherwise applicable wage rate in effect under section 4.”

    “this act shall preempt and supersede any local ordinance or rule concerning the subject matter of this act.”

  6. 6Credits to Accounts in Financial InstitutionsPennsylvania General Assembly · Official source · Page updated · Checked Pinpoint: 1975 Act 173 section 1.1; 1975 Act 173 section 2.1(5)(i)www.legis.state.pa.us/WU01/LI/LI/US/PDF/1975/0/0173..PDF
    What the source says

    “including a payroll card account, authorized to accept deposits or payments if the recipient has authorized the method of payment in writing or electronically.”

    “if the recipient has authorized the method of payment in writing or electronically.”

    “At least one withdrawal each pay period for any amount up to and including the full amount of the employee's net wages for that period or one such withdrawal weekly if the employee is paid more frequently than weekly.”

  7. 7Fact Sheet #15: Tipped Employees Under the Fair Labor Standards Act (FLSA)U.S. Department of Labor · Official source · Checked Pinpoint: Tip Credit, paragraph 2; Typical Problems, Overtime Problems, item 1www.dol.gov/agencies/whd/fact-sheets/15-tipped-employees-flsa
    What the source says

    “An employer must pay a tipped worker at least $2.13 per hour under the FLSA.”

    “the federal minimum wage, which is currently $7.25 per hour.”

    “The maximum tip credit that an employer can currently claim is $5.12 per hour: ($7.25 - $2.13 direct (or cash) wage = $5.12).”

  8. 8Minimum Wage Law Summary LLC-1Pennsylvania Department of Labor and Industry · Official source · Page updated · Checked www.pa.gov/content/dam/copapwp-pagov/en/dli/documents/individuals/labor-management-relations/documents/llc-1.pdf
    What the source says

    “Bureau of Labor Law Compliance”

    “800-932-0665”

  9. 9Tip recordkeeping and reportingInternal Revenue Service · Official source · Checked Pinpoint: Service charges are not tips, paragraph 2; qualified tips deduction, net-income limit; tip income, Social Security/Medicarewww.irs.gov/businesses/small-businesses-self-employed/tip-recordkeeping-and-reporting
    What the source says

    “Service charges (also referred to as “auto-gratuities”), when distributed to an employee, are generally treated as wages paid by the employer to the employee rather than tips paid by the customer.”

    “For self-employed individuals, the deduction may not exceed the individual’s net income (without regard to this deduction) from the trade or business in which the tips were earned.”

    “These amounts are subject to federal income tax and generally are also subject to Social Security and Medicare taxes.”

  10. 10Revenue Ruling 2012-18Internal Revenue Service · Official source · Page updated 2012 · Checked Pinpoint: Q 1/A 1, four distinguishing factors; p. 1, ruling headingwww.irs.gov/pub/irs-drop/rr-12-18.pdf
    What the source says

    “compulsion; (2) the customer must have the unrestricted right to determine the amount; (3) the payment should not be the subject of negotiation or dictated by employer policy; and (4) generally, the customer has the right to determine who receives the payment.”

    “Rev. Rul. 2012-18”

  11. 11Wage Payment and Collection LawPennsylvania General Assembly · Official source · Checked Pinpoint: Wage Payment and Collection Law 3(a); Wage Payment and Collection Law 5(a)www.legis.state.pa.us/WU01/LI/LI/US/HTM/1961/0/0329..HTM
    What the source says

    “Every employer shall pay all wages, other than fringe benefits and wage supplements, due to his employes on regular paydays designated in advance by the employer.”

    “within the standard time lapse customary in the trade or within 15 days from the end of such pay period.”

    “the wages or compensation earned shall become due and payable not later than the next regular payday of his employer on which such wages would otherwise be due and payable.”

  12. 12Fact Sheet #21: Recordkeeping Requirements under the Fair Labor Standards Act (FLSA)U.S. Department of Labor · Official source · Page updated · Checked Pinpoint: Posting, paragraph 1www.dol.gov/agencies/whd/fact-sheets/21-flsa-recordkeeping
    What the source says

    “Each employer shall preserve for at least three years payroll records, collective bargaining agreements, sales and purchase records.”

    “Employers must display an official poster outlining the provisions of the Act, available at no cost from local offices of the Wage and Hour Division and toll-free, by calling 1-866-4USWage (1-866-487-9243).”

    “Records on which wage computations are based should be retained for two years,”

  13. 13General Wage and Hour QuestionsPennsylvania Department of Labor and Industry · Official source · Checked Pinpoint: General Wage Questions, termination questionwww.pa.gov/agencies/dli/resources/compliance-laws-and-regulations/labor-management-relations/pennsylvania-s-minimum-wage-act/wage-faqs
    What the source says

    “the Pennsylvania Minimum Wage Act prohibits an employer from firing or otherwise retaliating against an employee because the employee has complained about their rights under the Act.”

  14. 14HB 1549 2025-2026 HistoryPennsylvania General Assembly · Official source · Checked www.palegis.us/legislation/bills/2025/hb1549
    What the source says

    “Third consideration and final passage, June 11, 2025 (102-101)”

  15. 15HB 2189 2025-2026 HistoryPennsylvania General Assembly · Official source · Checked www.palegis.us/legislation/bills/2025/hb2189
    What the source says

    “Third consideration and final passage, March 24, 2026 (104-95)”

15Methodology

How we research these pages

Every figure on this page comes from an official source, a statute, a regulation or a government agency page, and links to it where it is used. Ferry checks the page against those sources on a schedule and logs every change.

  1. 1

    Official sources only

    Statutes, regulations, state labor agencies, city ordinances and the U.S. Department of Labor. No vendor blogs, no AI answers, no secondary summaries as the only source.

  2. 2

    Every figure is linked

    Each rate and rule carries a numbered link to the statute or agency page behind it, with the exact pinpoint and, where available, a link that opens at the sentence itself.

  3. 3

    Re-checked on a schedule

    Every page is re-checked each January and July, and whenever a state or city changes a rate. Cash wage plus tip credit is checked against the minimum wage on every build.

  4. 4

    Gaps are left out, not guessed

    If a rule can't be confirmed from an official source, it isn't shown. The page points to the state agency instead.

What changed on this page

  1. First version of this page. Every figure was checked against the official sources listed on this page.

Researched by Ferry's tip operations research team. Last reviewed .

Changes to the law itself are listed in What changed and what's coming.

16Every state

Tip laws in every state

Pick any state for its tip credit, tip pool, service charge and card tip rules. Each chip shows the state's tip credit class.