Check your overtime!

Tip Credit is a federal law that allows employers to take a 'credit' against the minimum wage, and pay lower wages to employees who earn tips.

dough slapper
Posts: 29
Joined: Wed Oct 08, 2014 5:28 am

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PostPosted: Tue Sep 06, 2016 4:55 pm
For those of you in tip credit states do not forget to check your overtime. I had to point out again to our lawyer that Overtime rates were not being figured correctly with tip credits.

Remember: It is full min wage x 1.5 THEN minus tip credit, not tip credit wage times 1.5. This is a big difference and many of you are getting screwed on this.

Arizona Example (your state may vary) Minimum wage is 8.05 OTR is 5.05 so a 3.00 tip credit. Our store had us at 12.08 In store OT rate and 7.58 on the road overtime rate.

On the road overtime should be 12.08 - 3.00 tip credit or 9.08

This is a common error in payroll. Check your paystubs.

Closing Driver
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Joined: Mon Jun 02, 2014 1:41 pm

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Papa John's
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Pizza Delivery Driver
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Toyota Camry
PostPosted: Wed Sep 07, 2016 11:51 am
The Dominos, the Jimmy Johns, and the Papa Johns I've worked at all figured the overtime premium rate using the in store amount. The pay stub all looked the same, something like this:

Instore 7.25 41.63
On the road 4 43.91
OT Premium 3.63 5.54

The first two listings cover the time part of "time and a half" and the third would cover the half part. It works out well for everyone...the business doesn't have to pay someone to code a much more complicated payroll system and we get paid a little better if we are on the road and in overtime (generally when overtime happens)

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