Oklahoma Tip Laws and Requirements
Oklahoma's tip laws, last updated in April 2021 to align with federal changes, allow employers to take a tip credit of up to 50% of the minimum wage for tipped employees who earn at least $20 per month in tips, while adhering to the Fair Labor Standards Act's regulations that only permit tip credits for hours worked in tipped occupations and require tipped workers to be paid at least $2.13 per hour, with tips being the property of the employees and tip pooling allowed among eligible employees.
Under the Fair Labor Standards Act (FLSA), tips are regulated. Employers who meet certain criteria are permitted to take a partial credit against minimum wage obligations for tipped employees. Tipped employees include those engaged in jobs in which they regularly and customarily receive tips.
The tip credit was created by Congress in 1966, and adjustments occurred on December 28, 2021, when the 2021 Dual Jobs Final Rule went into effect. A federal court vacated portions of the final rule in October 2024, which effectively reinstated the original dual jobs regulation (29 C.F.R.531.56(e)). It recognizes that an employee may work in tipped and non-tipped occupations, and employers are only permitted to take the tip credit against minimum wage obligations for hours worked in the tipped occupation.
The FLSA mandates that a tipped worker must be paid at least $2.13 per hour. The FLSA tip credit can be equal to the difference between the direct (or cash) wage paid to the employee and the federal minimum wage. Only tips actually received by an employee count when making the determination of a tipped employee and applying the credit.
The FLSA also permits employees to “pool” or share tips with other eligible employees, although it doesn’t impose a limit on the amount or percentage of the contribution of each employee in a valid tip pool.
State law may differ from the federal FLSA standards. Review what tip laws apply in Oklahoma.
When Were the Tip Laws Last Updated in Oklahoma?
The tip laws were updated in Oklahoma in April of 2021 in alignment with changes to the federal laws.
Does Oklahoma Have Tip Laws That Differ from Federal Tip Laws?
Yes, Oklahoma has tip laws that differ slightly from federal laws. Employers are permitted to take a tip credit of up to 50% of the minimum wage, which currently aligns with the federal hourly rate. A tipped employee must earn at least $20 per month in tips.
Who Holds the Ownership of Tips in Oklahoma?
Under federal law, any gratuities paid to employees are their property. Employers are not permitted to require employees to hand in their tips, although they are allowed to count the tip toward the hourly rate.
What are the Rules for Distribution of Credit Card Processing Tips in Oklahoma?
Federal law states that all tips paid by credit card must be issued to employees no later than the next regular payday, even if the employer is awaiting reimbursement from the financial provider.
What are the Tip Pooling Rules in Oklahoma?
Mandatory tip pools are allowed in Oklahoma. However, any employer who takes the tip credit must only include tipped employees in the pool.
Who Can and Can’t Participate in Tip Pools in Oklahoma?
Tipped employees may participate in tip pools. Managers, owners, and non-tipped employees may not.
Is there a Difference Between Tips and Service Charges in Oklahoma?
Yes, a mandatory service charge is not considered a tip. Therefore, it would belong to the employer.
To be considered a tip instead of a service charge, a customer must give money voluntarily in an amount of their own choosing. The customer must also be able to determine who receives it, and it can’t be set by employer policy.
Can Employers Deduct Credit Card Fees from Tips in Oklahoma?
Yes, employers may deduct credit card fees from tips as long as doing so doesn’t take the hourly wage below the minimum.
Do Tips Count Toward the Minimum Wage in Oklahoma?
Yes, tips may count toward the minimum wage in Oklahoma as long as the employer follows the required tip credit vs. cash wage percentage.
Do Tips Factor Into Regular Rate Calculations for Overtime Pay in Oklahoma?
No, tips do not factor into rate calculations for overtime pay. Any eligible employee working over 40 hours in a week should receive overtime pay (1.5 times their normal hourly wage).
Are There Cities and Municipalities in Oklahoma That Have Their Own Tip and Service Charge Rules That Differ from Statewide Laws?
No, there are no cities or municipalities with differing laws.
What Are the Record-Keeping Requirements for Employers Regarding Tips in Oklahoma?
Employers must keep detailed records of all tips reported by employees, including amounts and dates of service. If tip pooling is in effect, the record should also include the arrangements and the distribution of tips to eligible staff members.
What Options Do Employees Have for Remuneration if Their Tips are Withheld in Oklahoma?
An employee may take legal action against an employer who violates state tip laws.
What are the Penalties for Employers for Not Complying with Oklahoma Tip Laws?
Violating Oklahoma tip laws can subject an employer to a fine of up to $1,162 per violation. Employees may also be permitted to recover the unpaid wages in damages.
Managing the regulations associated with tips in Oklahoma can be a challenge. The numerical clock prompt feature allows the employee to input their received tips at the end of the shift, and that information would be available for reporting and payroll processing.
Related
Iowa Tip Laws and Requirements
Iowa's tip laws, updated in 2021 to align with federal regulations, generally follow the Fair Labor Standards Act (FLSA) but allow employers to claim a 40% tip credit against minimum wage, require newly hired employees under 20 to receive at least $6.35 per hour in cash wages, and recognize that tips are the property of employees, with tip pooling permitted but not capped.
Pennsylvania Tip Laws and Requirements
Pennsylvania's tip laws, updated in August 2022, align with federal Fair Labor Standards Act regulations by allowing employers to take a tip credit against minimum wage for tipped employees who earn at least $135 per month in tips, requiring a base hourly wage of at least $2.83, while recognizing that tips are the property of employees and that tip pooling is permitted without federal limits on contribution amounts.
New Hampshire Tip Laws and Requirements
New Hampshire's tip laws, updated in September 2023, differ from federal FLSA regulations by requiring employers to pay tipped employees a base wage of at least 45% of the minimum wage plus at least $30 per week in tips, while federal law allows employers to take a tip credit against minimum wage obligations only for hours worked in tipped occupations and mandates a minimum cash wage of $2.13 per hour.
South Carolina Tip Laws and Requirements
South Carolina adheres to federal Fair Labor Standards Act (FLSA) tip laws, which regulate tipped employees' wages, allow employers to take a tip credit against minimum wage only for hours worked in tipped occupations, mandate a minimum cash wage of $2.13 per hour for tipped workers, permit tip pooling among eligible employees without limits on contributions, and recognize that tips are the property of employees, with the state's tip laws last updated in September 2021 and no deviations from federal standards.
Rhode Island Tip Laws and Requirements
Rhode Island's tip laws, updated in June 2022, generally follow federal Fair Labor Standards Act regulations—including the allowance of tip credits and tip pooling—but differ by applying a higher state minimum wage and new tip protections for employees earning over $30 monthly in tips, while federal rules permit employers to take tip credits only for hours worked in tipped occupations and require tipped employees to be paid at least $2.13 per hour.
Maryland Tip Laws and Requirements
Maryland's tip laws, updated most recently by the 2023 Fair Wage Act, require employers to pay tipped employees a higher minimum cash wage than the federal standard, allow a tip credit only against wages for hours worked in tipped occupations per reinstated federal dual jobs regulations, and permit tip pooling among eligible employees, with state-specific rules differing from the federal Fair Labor Standards Act.