2020 Iowa Tipped Minimum Wage
The 2020 Iowa Tipped Minimum Wage is $4.35.
Effective 2020-01-01Source: Wage Claims FAQ (Iowa Department of Inspections, Appeals, and Licensing)Verified 2026-09-01
Compared with 2019
Every figure on this page is unchanged from 2019.
| Item | 2019 | 2020 | Change |
|---|---|---|---|
| Minimum cash wage | $4.35 | $4.35 | +$0 (+0.0%) |
Who it applies to
Iowa employers with tipped employees and the tipped employees themselves
What changed this year, and why
Iowa's tipped minimum cash wage for 2020
Common questions
- What was the minimum cash wage for tipped employees in Iowa in 2020?
- In 2020, Iowa employers could pay tipped employees a cash wage of $4.35 per hour, provided the employee received a qualifying amount of monthly tips.
- What happens if tips plus the cash wage do not reach the full minimum wage?
- If the cash wage and tips do not average at least the full minimum wage per hour in any work week, the employer must pay the difference.
Who counts as a tipped employee
In Iowa, a tipped employee is someone who customarily and regularly receives more than $30 a month in tips. This definition matters because it determines whether an employer may pay the lower cash wage instead of the full minimum wage. If a worker's tips stay below that threshold in a typical month, the employer must pay the standard minimum wage; once the worker crosses it, the employer is allowed to rely on the tip credit and pay the reduced direct cash rate. The rule is meant to keep the tip-credit system limited to employees whose tips genuinely form a significant part of their pay, rather than letting employers apply it to workers who rarely see tips.
If you make $30 per month or more in tips, the employer may pay as little as $4.35 per hour.
Wage Claims FAQ (Iowa Department of Inspections, Appeals, and Licensing)
What a tip credit is, and the cash wage underneath it
Iowa allows employers of tipped workers to pay a direct cash wage below the full minimum wage and count the employee's tips toward the rest of the obligation. The minimum cash wage an Iowa employer may pay a tipped employee is $4.35 per hour; the employer then treats the employee's tips as filling the gap between that cash wage and the full minimum wage the worker is owed. This mechanism is called the tip credit. It is available only for workers who meet Iowa's definition of a tipped employee — those who customarily and regularly receive a certain monthly amount in tips. The tip credit does not relieve the employer of its minimum wage obligation entirely; it merely lets the employer satisfy part of that obligation with the employee's tip income rather than with direct cash. If tips in a given week fall short, the employer must make up the difference separately.
I'm a tipped employee. Can my employer pay me less than minimum wage?
Wage Claims FAQ (Iowa Department of Inspections, Appeals, and Licensing)
When the tips do not get you to the minimum wage
In Iowa, a tipped employee's total earnings, the direct cash wage plus tips, must reach the full minimum wage in every work week. If the cash wage of $4.35 per hour and the tips received do not together average at least $7.25 per hour for a given work week, the employer must make up the shortfall out of its own funds. This is a week-by-week calculation; an Iowa employer cannot average a slow week against a busy one. Even when tips are plentiful in some weeks, the employer remains responsible for ensuring the employee's combined pay meets the hourly floor each and every week.
If in any work week the wage the employer pays you and the tips you receive do not average at least $7.25 per hour, the employer is required to pay the difference.
Wage Claims FAQ (Iowa Department of Inspections, Appeals, and Licensing)
How each figure was verified
Each number below was read from a stored copy of the document named beside it, and checked to occur word for word in the quoted sentence. The digest is of that stored text.
Wage Claims FAQ (Iowa Department of Inspections, Appeals, and Licensing)
- Minimum cash wage
If you make $30 per month or more in tips, the employer may pay as little as $4.35 per hour.
Other years
Every Iowa Tipped Minimum Wage year · Tipped Minimum Wage in every state