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New York Reduces Tip Credit for Miscellaneous Industries

Effective June 30, 2020, the maximum tip credit for workers covered by the Minimum Wage Order for Miscellaneous Industries and Occupations is reduced by 50% as amended by Commissioner’s Order Proposing Modifications to the Miscellaneous Wage Order.

Beginning in 2021, employers covered by the state’s Miscellaneous Industries and Occupations Wage Order will be required to pay all employees the full minimum wage, without any credit for tips received. Employees will be permitted to receive the full minimum wage directly from the employer and retain all tips.

The Miscellaneous Industries and Occupations Wage Order has not yet been updated to reflect this change, but is expected to soon be made available from the NY DOL.

The Order issued by the Commissioner does not change the tip credit applicable to employees covered by the Hospitality Industry Wage Order (applicable to restaurants and hotels). For the time being, the tip credit remains available for these workers.

Next Steps

Employers covered by the Miscellaneous Industries and Occupations Wage Order should determine whether they have tipped employees who will be affected by the new rates and plan for increased labor costs beginning in June 2020 and continuing in 2021.

HR Works, headquartered in Upstate New York, is a human resource management outsourcing and consulting firm serving clients throughout the United States for over thirty years. HR Works provides scalable strategic human resource management and consulting services, including: affirmative action programs; benefits administration outsourcing; HRIS self-service technology; full-time, part-time and interim on-site HR managers; HR audits; legally reviewed employee handbooks and supervisor manuals; talent management and recruiting services; and training of managers and HR professionals.