2016 Texas Tipped Minimum Wage
The 2016 Texas Tipped Minimum Wage is $2.13.
Effective 2016-01-01Source: Texas Guidebook for Employers: Especially for Texas Employers (Texas Workforce Commission)Verified 2026-09-01
Who it applies to
Texas employers who take a tip credit against the wages of tipped employees
What changed this year, and why
Texas's minimum cash wage for tipped employees was $2.13 per hour in 2016.
Common questions
- What was the minimum cash wage for tipped employees in Texas in 2016?
- In 2016 a Texas employer that took a tip credit had to pay a tipped employee a direct cash wage of at least $2.13 per hour. Texas adopts the federal minimum wage, so the tip credit an employer may claim is the difference between that cash wage and the federal minimum wage.
- What happens if tips do not bring a tipped employee in Texas up to the minimum wage?
- The employer must make up the difference. A cash wage of $2.13 per hour plus the tips the employee actually receives has to equal at least the applicable minimum wage for every hour worked, and where it does not the employer owes the balance.
Who counts as a tipped employee
In Texas, the federal definition applies: a tipped employee is anyone who works in an occupation where they customarily and regularly receive more than $30 a month in tips. This threshold matters because it determines whether an employer may pay the lower cash wage and count a portion of the employee's tips toward the minimum wage obligation. If a Texas worker's tips in a given occupation stay below that amount, the worker is not classified as tipped for that job, and the employer must pay the full minimum wage in cash for those hours rather than relying on the tip credit. The $30 figure is measured month by month; occasional or irregular tips do not by themselves make an employee "tipped" under the rule.
Under the FLSA, a tipped employee is an employee engaged in an occupation in which they customarily and regularly receive more than $30 a month in tips.
Fact Sheet #15: Tipped Employees Under the Fair Labor Standards Act (FLSA) (DOL)
What a tip credit is, and the cash wage underneath it
In Texas, employers may count a portion of a tipped worker's tips toward the minimum wage, but only if they pay the worker at least $2.13 per hour in direct cash wages. The tip credit is the gap between that $2.13 cash wage and the full minimum wage the worker is otherwise owed; an employer that pays exactly $2.13 claims the largest credit allowed. The credit is never larger than the tips the employee actually keeps. If a Texas employer pays more than $2.13 in cash, the credit shrinks accordingly. Employers must still be able to show, each workweek, that the combination of cash wages paid and the tip credit taken adds up to at least the full minimum wage for all hours worked. Only tips actually received by the employee count when deciding whether the employee qualifies as tipped and when applying the credit.
An employer must pay a tipped worker at least $2.13 per hour under the FLSA. An employer can take an FLSA tip credit equal to the difference between the direct wage, or the cash wage it pays directly to the tipped employee, and the federal minimum wage, which is currently $7.25 per hour.
Fact Sheet #15: Tipped Employees Under the Fair Labor Standards Act (FLSA) (DOL)
When the tips do not get you to the minimum wage
In Texas, an employer using the tip credit must verify each workweek that the employee's cash wages plus tips actually received equal at least the full minimum wage. If the combined amount falls short, the employer must make up the difference. This is a weekly test, not an average over a pay period: a slow week in a Texas restaurant where tips are light still requires the employer to top up the worker's pay so the total reaches the minimum wage floor for every hour worked that week. The employer bears the responsibility for any shortfall; the worker cannot be asked to absorb it, and the employer cannot carry the deficit forward to later weeks when tips may be higher.
If an employee’s tips combined with the employer’s direct (or cash) wages do not equal the minimum hourly wage of $7.25 per hour in each workweek, the employer must make up the difference.
Fact Sheet #15: Tipped Employees Under the Fair Labor Standards Act (FLSA) (DOL)
The notice an employer owes you before it takes the credit
In Texas, before an employer may take a tip credit against a worker's wages, the employer must give the employee specific notice of how the credit works. Without that notice, the employer is not allowed to claim the credit at all and must instead pay the full minimum wage in cash. The notice must tell the worker the cash wage the employer is paying, the amount the employer is counting as a tip credit, that the tip credit cannot exceed the tips actually received, that the employee keeps all tips (except for a valid tip pool contribution), and that the tip credit will not apply unless the employee has been informed of these provisions. Texas employers may give this notice orally or in writing, but it must be delivered before the credit is taken.
Employers must provide the following information to tipped employees before taking a tip credit under the FLSA:
Fact Sheet #15: Tipped Employees Under the Fair Labor Standards Act (FLSA) (DOL)
When state law gives more than the federal rule
In Texas, when a state law provides greater protection to employees than the federal rule, employers must follow whichever standard is most favorable to the worker. For tipped employees, this matters because a Texas law could require a higher cash wage than $2.13 per hour or could limit or prohibit the tip credit entirely. Where the state rule is more protective, the employer must meet it regardless of what the federal rule allows. In practice, a Texas employer must compare the federal and state requirements for cash wage, tip credit size, and notice, and apply the combination that leaves the employee with the most pay. The federal minimum cash wage of $2.13 per hour remains a floor, but it is not the final answer where Texas law sets a higher one.
When state law differs from the federal FLSA, an employer must comply with the standard most protective to employees.
Fact Sheet #15: Tipped Employees Under the Fair Labor Standards Act (FLSA) (DOL)
Which tip pools you can be made to join
In Texas, when an employer takes a tip credit, any mandatory tip pool it requires workers to contribute to must be limited to employees in occupations in which they customarily and regularly receive tips. That means a Texas server, busser, bartender, or bellhop can be required to share tips with others in the same category, but the employer cannot force tipped employees to contribute to a pool that includes cooks, dishwashers, managers, or other non-tipped staff. An employer that runs a traditional tip pool must also tell tipped employees how much they must contribute, may only claim a tip credit for the tips the employee actually keeps after the pool, and may not retain any share of the pooled tips for itself.
to a tip pool which is limited to employees in occupations in which they customarily and regularly receive tips, such as waiters, bellhops, counter personnel (who serve customers), bussers, and service bartenders.
Fact Sheet #15: Tipped Employees Under the Fair Labor Standards Act (FLSA) (DOL)
Doing two jobs for one employer
In Texas, an employee who works two distinct jobs for the same employer - for example, a hotel maintenance worker who also serves as a server - is a tipped employee only with respect to the job in which they customarily and regularly receive at least $30 a month in tips. For the tipped job, the employer may apply the tip credit; for the other job, no tip credit is allowed and the full minimum wage must be paid in cash for every hour worked in that occupation. Employers must track which hours belong to which job. This rule is different from a tipped employee who spends part of their time on related tasks like cleaning tables, making coffee, or washing dishes; those are still part of the tipped occupation. The dual-job rule applies only when the worker genuinely switches between two separate occupations.
In such a situation the employee, if they customarily and regularly receive at least $30 a month in tips for their work as a server, is a tipped employee only with respect to their employment as a server.
Fact Sheet #15: Tipped Employees Under the Fair Labor Standards Act (FLSA) (DOL)
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.
Texas Guidebook for Employers: Especially for Texas Employers (Texas Workforce Commission)
- Minimum cash wage
The FLSA sets minimum wage levels (minimum wage of $7.25 per hour (the Texas minimum wage is the same), a minimum cash wage of $2.13 per hour for tipped employees, overtime pay at one and a half times the regular rate of pay, and a minimum salary level of $684 per week for salaried exempt employees)
Other years
Every Texas Tipped Minimum Wage year · Tipped Minimum Wage in every state