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Minnesota employers are prohibited from taking a tip credit against the minimum wage

  • Employers may not count tips received by an employee toward the payment of minimum wage.

  • Employees must receive the applicable minimum wage in addition to any tips they may receive.

Employers are prohibited from directing employees to pool or share tips

  • No employer may require an employee to share a tip with the employer or other employees or to contribute to any tip pool, except as listed below.

  • When more than one direct service employee provides direct service to a customer in a given situation such as banquets, money presented by customers as a gratuity and divided among the direct service employees is not a violation of Minnesota tip laws.

  • Dividing money left in a tip jar, or the equivalent of a tip jar, among direct service employees working on the same shift is not a violation of Minnesota tip laws and related case law. A “shift” means a period of time in which a particular group of employees work together to provide direct service to customers.

Employers may take the following actions regarding tips

  • Upon the request of employees, an employer may store tips to be shared by employees and disburse shared tips to employees who agree.

  • An employer may report amounts received as tips for tax purposes.

  • For credit card tips only, employers may keep a percentage of the tip that is the same amount deducted by a credit card service company.

Download a printable fact sheet about tip laws.

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