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New Hampshire Adopts New Tipped Employee Wage Rate

On July 23, 2021, New Hampshire adopted a new base rate for tipped employees of $3.27 per hour. This new tipped employee base rate replaces the previous state rate, which was 45% of the state’s minimum wage rate. This new law also indicates that the federal rate for tipped employees will apply whenever the federal rate for tipped employees exceeds the state rate. 

The current minimum wage rate in the state is the federal rate of $7.25 per hour. The federal base rate for tipped employees is $2.13 per hour. 

Tipped Employee Wages. State law allows employers to pay tipped employees a lower minimum wage rate, also known as a cash wage or base rate, because it assumes the employees’ tips and cash wage will be sufficient for them to earn a wage rate at least equal to the state minimum wage rate. However, state law also requires employers to subsidize their tipped employees’ wages whenever the combination of base wages and tips is lower than the state minimum wage rate. 

Tipped Employees. New Hampshire defines a “tipped employee” as an individual working for a restaurant, hotel, motel, inn, cabin or ballroom. Tipped employees must also customarily and regularly receive more than $30 per month in tips directly from the customer. 

Employers may not pay their tipped employees a base rate for nontipped work. This prohibition does not apply to duties that are incidental to the regular duties of the tipped employee and generally assigned to the tipped employees.

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