CashoutTipped minimum wage / Rhode Island
Rhode Island tipped minimum wage
What employers must pay
In Rhode Island, the minimum wage is $16.00 an hour. An employer can pay a tipped employee as little as $3.89 an hour in cash, as long as tips bring the total to at least $16.00. The difference, $12.11, is the tip credit.
Who counts as a tipped employee: more than $30 a month in tips.
If your cash wage plus tips comes up short of $16.00 an hour in a workweek, your employer has to make up the difference.
What changes next
On January 1, 2027, the minimum wage goes to $17.00, and the tipped cash wage stays at $3.89. The tip credit grows to $13.11.
Tip pooling and service charges
Tips belong to the employee, and the employer may keep no part of them. Pools may include workers who usually get tips; staff who don't get tips may join only if the employer pays everyone the full minimum and takes no tip credit. Salaried managers and other workers who aren't owed overtime may not be in a pool.
Mandatory service charges belong to the employer unless paid out to staff, and employers may deduct card processing fees from tips only with notice and only if pay does not fall below minimum wage.
Overtime
Time and a half after 40 hours in a workweek, no daily overtime; separate laws require time and a half for Sunday and holiday work in retail and some other businesses. Tipped overtime is figured on the full $16.00 minimum, then the tip credit is subtracted.
Taxes on your tips
Rhode Island taxes wage income, and tips are wages, so its income tax applies to your tips. Federal income tax, Social Security and Medicare still apply. The federal tip deduction can cut the income tax part: see how the No Tax on Tips deduction works.
Check a week's pay
Enter one workweek to see whether your cash wage plus tips reached Rhode Island's minimum of $16.00 an hour.
You reached the minimum this week.
You came up short. Your employer owes you at least
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 Rhode Island Department of Labor and Training, Labor Standards Unit: how to file. You can also call the U.S. Department of Labor, Wage and Hour Division, at 1-866-487-9243.
