Tips Calculation (U.S. and CA)

If you use the Tips application, you can process the Tip Calculation to:

• Verify minimum wage requirements according to the employee's work state or federal requirements

• Calculate the tip credit if minimum wage was not met

• Create time records for any shortfall amount

• Create tip history records used for tip allocation

• Calculate the hours worked in tipped jobs for tip allocation using the hours worked method

The tip credit is stored for audit and reporting purposes and is included in the regular rate of pay for the overtime calculation.

Hours worked for tipped employees in tipped jobs are calculated and stored for use in the hours worked method of tip shortfall allocation calculation.

If there is no tip time record, the Tip Calculation determines which direct or indirect pay code to use based on the time record job code and on how Company Allocation is set up.

The Tip Calculation can be required as part of the Payroll Cycle if it is flagged as required on the Company or Process Level forms.