Those getting into the service industry are sometimes surprised to find out that the pay seems far lower than they thought. In fact, they may even be told that they’re only going to be paid $2.13 per hour by their employer. Since this is so far under minimum wage, they assume that it must be some sort of mistake.
It is not a mistake, as minimum wage is set at the federal level. Other states have set higher standards, but Kentucky simply adheres to the same federal standards with a minimum wage of $7.25 per hour. However, for tipped employees, the minimum that the business has to play is just $2.13.
Shouldn’t you still make minimum wage?
The thing to remember about this is that you always do have to make the minimum wage of $7.25 per hour. There is never a scenario in which you should be paid less than that.
In the service industry, your employer simply gets to combine the value of your tips with your wage. Say that you make $10 in tips over an hour, for example. Your employer only has to pay you $2.13 because you will really be getting $12.13 for that hour of work.
But if you do not get any tips, or you don’t get enough to bring you up to minimum wage, then your employer does have to pay the difference. You will always make at least $7.25 per hour. The difference just lies in whether or not your wage comes mostly from your employer or mostly from your tips.
Not all employers will follow these rules, however, and may pay you less than you are owed. If this happens, be sure you know about all of your legal options.