2022 South Dakota Tipped Minimum Wage
The 2022 South Dakota Tipped Minimum Wage is $4.975.
Effective 2022-01-01Source: State Minimum Wage to Increase Jan. 1 (South Dakota Department of Labor and Regulation)Verified 2026-09-01
Compared with 2021
| Item | 2021 | 2022 | Change |
|---|---|---|---|
| Minimum cash wage | $4.725 | $4.975 | +$0.25 (+5.3%) |
Who it applies to
Tipped employees working for South Dakota employers
What changed this year, and why
South Dakota's tipped minimum cash wage increased to $4.975 per hour on January 1, 2022, up from $4.725 per hour in 2021. The tipped cash wage is set at half the regular minimum wage.
Common questions
- Must an employer make up the difference if tips do not bring a tipped employee's pay up to the full minimum wage?
- Yes. Wages and tips combined must equal at least the full minimum wage.
What a tip credit is, and the cash wage underneath it
In South Dakota, the tip credit is the difference between the full minimum wage and the direct cash wage an employer pays a tipped worker. The state sets the hourly minimum cash wage for tipped employees at $4.975, which is half the minimum wage for non-tipped employees. This means the employer pays $4.975 directly and counts the employee's tips toward satisfying the remaining portion of the minimum wage. South Dakota adjusts this cash wage each year based on the cost of living, as measured by the Consumer Price Index. A tipped worker in South Dakota is guaranteed at least $4.975 per hour in cash from their employer, with tips filling the gap up to the full minimum. If the tips in any workweek are not enough to reach that floor, the employer must cover the difference. These rules apply to all South Dakota employers, with limited exceptions.
The hourly minimum wage for tipped employees will be $4.975/hour effective Jan. 1, 2022, half the minimum wage for non-tipped employees.
State Minimum Wage to Increase Jan. 1 (South Dakota Department of Labor and Regulation)
When the tips do not get you to the minimum wage
South Dakota allows employers to pay tipped workers a lower cash wage of $4.975 per hour, which is half the regular minimum wage. However, the employer does not get a free pass if tips run low. South Dakota law requires that wages and tips combined must equal at least the minimum wage for every hour worked. This means the employer must track total earnings each pay period. If an employee's cash wage plus the tips actually received do not add up to the full state minimum wage, the employer is responsible for paying the shortfall out of its own funds. The worker's total hourly take-home pay cannot drop below the regular minimum wage regardless of how generous or slow customers are on any given day. In South Dakota, the tip credit is conditional: the employer keeps the benefit of the reduced cash wage only as long as tips are sufficient to close the gap. When they are not, the employer must cover the difference.
Wages and tips combined must equal at least the minimum wage.
State Minimum Wage to Increase Jan. 1 (South Dakota Department of Labor and Regulation)
The notice an employer owes you before it takes the credit
South Dakota requires employers to provide information to tipped employees before taking a tip credit. The state's hourly minimum cash wage for tipped employees is $4.975, which is half the minimum wage for non-tipped employees. Before an employer in South Dakota can pay this reduced cash wage and count tips toward the minimum wage obligation, the employer must notify the employee about the tip credit arrangement. This notice ensures workers understand that their employer is paying them less than the full minimum wage directly and relying on their tips to make up the difference. South Dakota adjusts the tipped cash wage annually based on the cost of living as measured by the Consumer Price Index. A worker in South Dakota has the right to know before their employer takes advantage of the tip credit. These requirements apply to all South Dakota employers, with some limited exceptions.
The hourly minimum wage for tipped employees will be $4.975/hour effective Jan. 1, 2022, half the minimum wage for non-tipped employees.
State Minimum Wage to Increase Jan. 1 (South Dakota Department of Labor and Regulation)
Your employer, your manager and your supervisor may not keep your tips
South Dakota law protects the tips earned by workers. Tips belong to the employee, not the employer. An employer in South Dakota cannot keep any portion of an employee's tips, whether the employer takes a tip credit or not. The state sets the hourly minimum cash wage for tipped employees at $4.975, which is half the minimum wage for non-tipped employees, but this reduced wage does not give the employer any claim to the worker's tips. Tips are the property of the employee who receives them. Even when an employer uses a tip credit to pay the lower cash wage, all tips remain with the employee. South Dakota adjusts the tipped cash wage each year based on the cost of living as measured by the Consumer Price Index. These protections apply to all South Dakota employers, with some limited exceptions.
The hourly minimum wage for tipped employees will be $4.975/hour effective Jan. 1, 2022, half the minimum wage for non-tipped employees.
State Minimum Wage to Increase Jan. 1 (South Dakota Department of Labor and Regulation)
Which tip pools you can be made to join
In South Dakota, tip pools are arrangements where tipped employees share their tips with other workers. The state's hourly minimum cash wage for tipped employees is $4.975, which is half the minimum wage for non-tipped employees. When a tip pool exists, it must be limited to employees in occupations where they customarily and regularly receive tips. A worker in South Dakota cannot be forced to share tips with employees who do not traditionally receive tips, such as cooks or dishwashers who are not part of the tipped workforce. The tip pool must include only those who are themselves tipped employees under South Dakota law. South Dakota adjusts the tipped cash wage annually based on the cost of living as measured by the Consumer Price Index. These rules apply to all South Dakota employers, with some limited exceptions.
The hourly minimum wage for tipped employees will be $4.975/hour effective Jan. 1, 2022, half the minimum wage for non-tipped employees.
State Minimum Wage to Increase Jan. 1 (South Dakota Department of Labor and Regulation)
Doing two jobs for one employer
In South Dakota, some workers perform both tipped and non-tipped duties for the same employer. When an employee spends part of their time in a tipped occupation and part in a non-tipped occupation, they are a tipped employee only with respect to their employment as a server or other tipped role. The state's hourly minimum cash wage for tipped employees is $4.975, which is half the minimum wage for non-tipped employees. This means that for hours spent in the tipped role, the employer may pay the lower cash wage and take a tip credit. But for hours spent in non-tipped work, the employer must pay the full minimum wage. A worker in South Dakota who splits their time between tipped and non-tipped duties must receive the appropriate wage for each type of work. South Dakota adjusts both wages annually based on the cost of living as measured by the Consumer Price Index. These rules apply to all South Dakota employers, with some limited exceptions.
The hourly minimum wage for tipped employees will be $4.975/hour effective Jan. 1, 2022, half the minimum wage for non-tipped employees.
State Minimum Wage to Increase Jan. 1 (South Dakota Department of Labor and Regulation)
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.
State Minimum Wage to Increase Jan. 1 (South Dakota Department of Labor and Regulation)
- Minimum cash wage
The hourly minimum wage for tipped employees will be $4.975/hour effective Jan. 1, 2022, half the minimum wage for non-tipped employees. Wages and tips combined must equal at least the minimum wage. These increases will apply to all South Dakota employers, with some limited exceptions.
Other years
Every South Dakota Tipped Minimum Wage year · Tipped Minimum Wage in every state