Tipped minimum wage / Puerto Rico

By NorseHorse. Rates in force on October 15, 2026, checked against the sources at the bottom of this page. General information, not legal advice.

What employers must pay

In Puerto Rico, the minimum wage is $10.50 an hour. An employer can pay a tipped employee as little as $2.13 an hour in cash, as long as tips bring the total to at least $10.50. The difference, $8.37, is the tip credit.

Farm workers, government and city employees, and some managers and professionals are not covered by the $10.50 rate. Employers that only federal law covers must pay at least $7.25.

Who counts as a tipped employee: anyone who gets more than $30 a month in tips.

If your cash wage plus tips comes up short of $10.50 an hour in a workweek, your employer has to make up the difference.

What changes next

No change to the Puerto Rico minimum wage is scheduled. Puerto Rico's law has no automatic increase after July 1, 2024. Any new rate would have to come from the island's Minimum Wage Review Commission, and lawmakers are considering a bill to take that power back.

Tip pooling and service charges

Tips belong to the employee. A tip pool may include only employees who receive tips, and the employer may not keep tips or take part in the pool. The employer must tell employees in advance before taking a tip credit.

Overtime

Overtime is time and a half after 8 hours in a day, after 40 hours in a week, and on your weekly day of rest. Workers hired before January 26, 2017 keep any better rights they had. For tipped workers, overtime is figured on the full $10.50, so the cash wage for an overtime hour is at least $7.38 ($15.75 minus the $8.37 tip credit).

Taxes on your tips

Puerto Rico taxes wage income, and tips are wages, so its income tax applies to your tips. Social Security and Medicare still apply. Most Puerto Rico residents do not pay federal income tax on income earned in Puerto Rico.

Check a week's pay

If you are underpaid

Start by comparing your pay stubs with your own record of hours and tips. If the numbers don't add up, you can file a complaint with the Puerto Rico Department of Labor and Human Resources (DTRH): how to file. You can also call the U.S. Department of Labor, Wage and Hour Division, at 1-866-487-9243.

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