Example 2

The following time records were created for John:

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

The Tip Credit Calculation calculates as follows:

Creates time record for tip shortage as follows:

  1. Verifies minimum wage has been met:
    2.41 x 28 (hrs) = 67.48 + 45.00 (tips) = 112.48 total wages
    4.25 x 28 (hrs) = 119.00 min. wage required
    6.52 Tip shortage
  2. Calculates tip credit:

    119.00 - 67.48 = 51.52 tip credit amount