Example 1

The following time records were created for Megan:

Megan is an hourly, weekly-paid employee who is eligible for the tip credit. The minimum wage for her state of MD is 4.25/hour.

The Tip Credit Calculation calculates as follows:

  1. Verifies minimum wage has been met:
    2.13 x 32 (hrs) = 68.16 + 100.00 (tips) = 168.16 total wages
    4.25 x 32 (hrs) =

    136.00 min. wage required

    No tip shortage.
  2. Calculates tip credit:

    136.00 - 68.16 = 67.84 tip credit amount