Minimum Wage and Tipping laws in Key West
Minimum wage and tipping lawsuits in Key West is different from other parts of the country and even within the state of Florida. The reason for this is that many service workers (waiters, waitresses, bartenders, busboys, and food runners, and taxi drivers) prefer an out of town lawyer to represent them. Key West is a small island city with a small town field. Many Key West prefer to hire an out of town lawyer with the expertise in suing restaurants and bars. Many lawyers are not familiar with the unique mixture of Federal wage law, Florida’s wage law, and the unique business practices in Key West restaurants and bars.
Like all tipped employees across the country, Key West waiters and bartenders are entitle to the minimum wage under Fair Labor Standards Act. On November 2, 2004, Florida voters approved a constitutional amendment which created Florida’s minimum wage. The minimum wage applies to all employees in the state who are covered by the federal minimum wage.
The federal law (FLSA- 29 U.S.C. § 206) as well as Florida State law (F.S. § 448.110 and Fla. Const. Art. 10 § 24), require payment of a minimum wage. Florida minimum wage law is interpreted in accordance with the FLSA. Martinez v. Ford Midway Mall, Inc., 59 So.3d 168, 173 (Fla. 3d DCA 2011). The Florida minimum wage statute states:
Only those individuals entitled to receive the federal minimum wage under the
federal Fair Labor Standards Act and its implementing regulations shall be eligible to receive the state minimum wage pursuant to s. 24, Art. X of the State Constitution and this section. The provisions of ss. 213 and 214 of the federal Fair Labor Standards Act, as interpreted by applicable federal regulations and implemented by the Secretary of Labor, are incorporated herein. F.S. § 448.110(3).
“Employers of tipped employees…must pay a direct reduced minimum wage if they
claim a “tip credit.” 29 U.S.C. § 203(m); Perez v. Palermo Seafood, Inc., 548 F.Supp.2d 1340,
1347 (S.D. Fla. 2008) aff’d, 302 Fed. Appx. 905 (11th Cir. 2008). The “wage” that restaurants
“shall pay” to a tipped employee is explained in 29 U.S.C.A. § 203(m): “the amount paid such
employee by the employee’s employer shall be an amount equal to” the required reduced cash
The Florida Constitution describes the “tip credit” that is allowed in Florida as $3.02 an hour since 2003:
For tipped Employees meeting eligibility requirements for the tip credit under the
FLSA, Employers may credit towards satisfaction of the Minimum Wage tips up
to the amount of the allowable FLSA tip credit in 2003. Fla. Const. Art. 10 §
In 2003, the Federal minimum wage was $5.15 per hour. In 2003, the reduced cash wage which had to be paid to an employee was $2.13, and the “tip credit” was $3.02 per hour. Thus, in Florida the “tip credit” remains constant at $3.02 per hour. This means that the minimum wage that must be paid to tipped employees in Key West is the reduced minimum wage set forth by statute:
Tips may be considered as part of wages, but the employer must pay not less than $2.13 an hour in direct wages and make sure that the amount of tips received is enough to meet the remainder of the minimum wage. Solis v. Aguilar, 3:09-CV-
0646, 2009 WL 3049285 (M.D. Tenn. 2009)
The 2017 Florida minimum wage is $8.10 per hour, effective January 1, 2017. Before this year, the Florida minimum wage was $8.05. Employers in Key West must pay their employees the hourly state minimum wage ($8.10 in 2017 and $8.05 before 2014-2016) for all hours worked.
When the Florida wage rate increases higher than the Federal minimum wage rate ($8.05 hour Florida- $7.25 Federal Minimum wage), the FLSA requires payment of the higher state rate. 29 U.S.C.A. § 218; see also Chan v. Sung Yue Tung Corp., 154 Lab. Cas. P 35256 (S.D.N.Y. 2007) (when State minimum wage law higher §218 requires payment of the higher wage). Employers of tipped employees, who meet eligibility requirements for the tip credit under the FLSA, may credit towards satisfaction of the minimum wage tips up to the amount of the allowable FLSA tip credit in 2003. However, the employer must pay tipped employees a direct wage. The direct wage is calculated as equal to the minimum wage ($8.10) minus the 2003 tip credit ($3.02), or a direct hourly wage of $5.08 as of January 1, 2017.
Workers in Key West who are not paid the minimum wage may bring a civil action against the restaurant or bar for violating Federal and Florida’s minimum wage law.
Common Minimum Wage Violation in Key West.
- Failing to Post the Statutory Required Signage.
Florida Statutes require employers who must pay their employees the Florida minimum wage to post a minimum wage notice in a conspicuous and accessible place in each establishment where these employees work. This poster requirement is in addition to the federal requirement to post a notice of the federal minimum wage. Failing to give the proper tip notice prevents the employer from using a tip credit. May restaurants and bars in Key West do not have the proper tip notice signage. As a result the restaurants do not qualify to use a tip credit and is subject to legal action for the $5.03 to $5.08 hourly pay to waiters, waitresses, bartenders, busboys, and food runners, and taxi drivers.
- Sharing Tips with Non-tip Employees
High numbers of tourists that visit Key West may be challenging to service employees in many restaurants and bars. Unfortunately, many Key West restaurants and bars react by creating a financial incentive that connects the front of the house workers with back of the house workers. The faster the kitchen workers fulfills the order, the faster the waiters and bartenders can serve the customer and earn better tips. Customer satisfaction goes up and tips increase. The down side of this approach is that the restaurants and bars require the waiters, waitresses, bartenders, busboys to “tip out” to kitchen workers and other workers who normally do not interact with customers and receive tips. The practice of tipping out to kitchen workers by Key West restaurants and businesses voids the tip credit. When a wage and hour lawsuit is brought against these businesses, they will have to back and pay $5.03 to $5.08 hourly pay to waiters, waitresses, bartenders, busboys.
- Permitting Managers Who Help Wait Tables Or Bartends Participate In The Tip Pool
Like other restaurants in Florida, may Key West restaurants and bars require the manager in charge to pitch in during busy time by taking food and drink order, bussing tables, and pouring drinks behind the bar. As a result, may managers feel entitled to share in the tips. This voids the tip credit.
The Tran Law Firm is based in Houston, Texas but represents individuals in minimum wage and overtime violation all over the country. The Firm’s employment lawyers are available to represent workers in Key West.