2025 South Dakota Tipped Minimum Wage
The 2025 South Dakota Tipped Minimum Wage is $5.75.
Effective 2025-01-01Source: State Minimum Wage to Increase Jan. 1 (South Dakota Department of Labor and Regulation)Verified 2026-08-31
Compared with 2024
| Item | 2024 | 2025 | Change |
|---|---|---|---|
| Minimum cash wage | $5.60 | $5.75 | +$0.15 (+2.7%) |
Who it applies to
Tipped employees and their employers in South Dakota
What changed this year, and why
South Dakota's minimum cash wage for tipped employees increased to $5.75 per hour, effective January 1, 2025, up from $5.60 in 2024.
Common questions
- Does the tipped employee's total pay (wages plus tips) have to meet the full minimum wage?
- Yes. Employers must ensure that an employee's cash wages plus tips together equal at least the full state minimum wage. If they do not, the employer must make up the difference.
Every amount on this page is a published figure rather than yours. The Tips needed per hour takes the number you enter and works it out against them, showing which published figure it used.
Who counts as a tipped employee
In South Dakota, you count as a tipped employee if you customarily and regularly receive tips as part of your work. For 2025, the state sets the minimum cash wage that your employer must pay you directly at $5.75 per hour. This rate applies to workers in roles such as servers, bartenders, and others who routinely receive tips from customers. The $5.75 cash wage is the amount your employer hands you before any tips are counted; the tips you actually earn are separate and on top of that direct wage. South Dakota applies this rule to all employers in the state, with only limited exceptions. If your job does not regularly produce tips, you are not a tipped employee and your employer must pay you the full state minimum wage.
The hourly minimum wage for tipped employees will be $5.75/hour effective Jan. 1, 2025, half the minimum wage for non-tipped employees.
State Minimum Wage to Increase Jan. 1 (South Dakota Department of Labor and Regulation)
What a tip credit is, and the cash wage underneath it
In South Dakota, the tip credit is the difference between what an employer must pay a tipped employee directly and the full state minimum wage. For 2025, that direct cash wage is $5.75 per hour, while the full minimum wage is higher. This means the employer can count the tips you actually receive toward meeting its obligation to pay you at least the full minimum wage. However, the employer must still pay you at least $5.75 per hour in direct wages regardless of how many tips you earn. If your tips plus the $5.75 cash wage do not add up to the full minimum wage for a given pay period, the employer is required to pay the shortfall so that your total earnings meet the minimum wage floor.
The hourly minimum wage for tipped employees will be $5.75/hour effective Jan. 1, 2025, 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
In South Dakota, if your hourly cash wage plus the tips you receive in a workweek do not add up to at least the full state minimum wage, your employer must pay the difference. For 2025, your employer must pay you at least $5.75 per hour in direct wages, but the total of that wage plus your tips must reach the full minimum wage or higher. If in any week your tips fall short and your combined earnings are below the minimum, the employer is legally required to make up the gap. This rule ensures that no tipped worker in South Dakota takes home less than the minimum wage for hours worked, regardless of how generous or sparse customer tips may be.
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
In South Dakota, before an employer can pay a tipped worker the reduced cash wage of $5.75 per hour, it must inform the employee about the tip credit arrangement. The employer must tell the worker the amount of the cash wage it will pay, the additional amount it claims as a tip credit, that the tip credit cannot exceed the tips actually received, and that all tips belong to the employee unless there is a valid tip pool. The employer must also explain that the tip credit will not apply unless the employee has been given this notice. Without providing this information first, the employer loses the right to count tips toward the minimum wage and must pay the full minimum wage directly.
The hourly minimum wage for tipped employees will be $5.75/hour effective Jan. 1, 2025, 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, an employer may require a tipped employee to participate in a tip pool, but the pool must be limited to employees in occupations where they customarily and regularly receive tips. For 2025, the tipped cash wage is $5.75 per hour. The pool cannot include workers such as cooks, dishwashers, or janitors who do not normally receive tips from customers. If an employer requires participation in a pool that includes ineligible employees, it loses the right to take the tip credit and must pay the full minimum wage. All tips contributed to the pool must be distributed among the participating eligible employees; the employer may not retain any portion.
The hourly minimum wage for tipped employees will be $5.75/hour effective Jan. 1, 2025, 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, an employee who performs both tipped and non-tipped work for the same employer is considered a tipped employee only with respect to the time spent in the tipped occupation. For 2025, the tipped cash wage is $5.75 per hour. When a worker splits duties between a tipped role and a non-tipped role, the employer must track the hours separately. For time spent in the non-tipped work, the employer must pay the full minimum wage, not the reduced cash wage. If the employer cannot demonstrate how much time was spent in each role, it may lose the ability to pay the lower tipped wage for any of the hours worked. This rule prevents employers from paying the lower wage for work that does not generate tips.
The hourly minimum wage for tipped employees will be $5.75/hour effective Jan. 1, 2025, 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 $5.75/hour effective Jan. 1, 2025, 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