Minimum Wage Violations for Tipped Employees in Illinois

 Posted on August 15, 2023 in Employee Rights

As an employer in Illinois, you are responsible for paying your tipped employees the minimum wage. The Illinois Minimum Wage Act (IMWA) sets the minimum wage for tipped employees at $7.80 per hour as long as the employee's tips bring their total earnings up to the state minimum wage of $13.00 per hour. However, there are a number of rules and regulations that you must follow in order to comply with the IMWA.

What If My Tipped Employees Do Not Make Enough Tips to Reach the Minimum Wage?

If your tipped employees do not make enough tips to reach the minimum wage, you may be required to make up the difference. This is called the tip credit. An employer can pay tipped employees $7.80 per hour in wages, plus $3.30 per hour in tips, as long as the employee’s total earnings reach the state minimum wage of $13.00 per hour. If the employee’s tips average $20 or more per month, as an employer, you will not be required to make up the difference.

What are Some Common Minimum Wage Violations for Tipped Employees?

Paying tipped employees less than the minimum wage is the most common minimum wage violation. Other common minimum wage violations include:

• Claiming that the employee's tips bring their total earnings up to the minimum wage, when in reality they do not.

• Not making up the difference when tipped employees fail to make enough tips to reach the minimum wage.

• An employer using the tips that belong to the employees to pay for things like uniforms, meals, or other expenses.

• Requiring tipped employees to share their tips with other employees who do not receive tips. The only exception is if the employees voluntarily agree to share their tips.

What are the Consequences of Violating Tipped Employee Minimum Wage Laws in Illinois?

If you are found to be in violation of minimum wage laws for tipped employees, you could face a number of consequences, including:

• You will be required to pay the employees the difference between what they were paid and what they should have been paid, plus interest.

• You could be fined by the Illinois Department of Labor (IDOL).

• In some cases, violating minimum wage laws may be considered a crime. If you are convicted of a crime, you could face fines and imprisonment.

How Can I Avoid Minimum Wage Violations for Tipped Employees?

To avoid minimum wage violations for tipped employees, you should:

• The IMWA is a complex law, and it can be difficult to keep up with the changes. It is important to consult with an attorney who specializes in employment law to make sure you are in compliance with the law.

• You must keep accurate records of employee wages and tips for at least three years. This will help you to defend yourself against any claims of minimum wage violations.

• Train your employees to know their rights under the IMWA and how to report any violations.

• If you suspect that you may be in violation of the IMWA, you should take steps to correct the problem immediately.

Contact an Illinois Employment Law Attorney

Employers in Illinois must adhere to the rules and regulations set forth by the Illinois Minimum Wage Act (IMWA). To better understand the requirements to comply with state laws, you can schedule a free consultation with a Schaumberg, IL, minimum wage violations attorney at the The Miller Law Firm, P.C.. The consequences of violating minimum wage laws can be severe. If you stand accused of minimum wage violations, do not hesitate to reach the office at 847-995-1205 where we can discuss your options.

Source: https://www.dol.gov/agencies/whd/state/minimum-wage/tipped

https://www.irs.gov/taxtopics/tc761

https://labor.illinois.gov/laws-rules/fls/minimum-wage-rates-by-year.html