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"Service Charge" included in Minimum Wage? California

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  • "Service Charge" included in Minimum Wage? California

    I work in the hospitality industry [Hotel/Food Server]. My employer maintains that, because gratuities are assessed and referred to as "service charges" the law in California allows them to pay less than minimum wage. The rationale being that because the service charge is never less than the minimum wage that they are meeting the requirement.

    In reading other posts I notice that idea is contested; except that they invariable refer to 'tips' and 'gratuities' but not 'service charges'. Has someone had experience with this particular issue?

  • #2
    Nope. California doesn't even allow tip credit to be used, period. So, even if "service charges" WERE defined as "tips" (which they aren't-see the first link below), in California, you still must be paid the full minimum wage (second link).
    http://www.dol.gov/esa/regs/compliance/whd/whdfs15.pdf
    http://www.dol.gov/esa/programs/whd/...htm#California
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