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Massachusetts Modifies Timing for Calculating Minimum Wage for Tipped Employees

10/01/18

Author: ADP Admin/Wednesday, October 3, 2018/Categories: Massachusetts

Overview: As a result of the enactment of H4640, effective January 1, 2019, Massachusetts employers who utilize a tip credit in paying tipped employees must calculate the minimum wage rate at the end of each shift.

Effective Date: January 1, 2019

Details:Under current law, the calculation of whether a tipped employee earned enough tips plus the cash wage to bring him or her to at least the minimum wage is done on a weekly basis. As of January 1, 2019, the calculation must be made at the completion of each shift.

H4640 states in part as follows:

SECTION 27. Said section 7 of said chapter 151, as appearing in the 2016 Official Edition, is hereby further amended by inserting after the words “section 1”, in line 36, the following words:- ; provided, however, that an employer shall calculate the amount required by clause (2) at the completion of each shift worked by the employee, with payments to the employee to be consistent with section 148 of chapter of 149.

For a copy of the enacted version of H4640 please click on the link provided below: https://malegislature.gov/Laws/SessionLaws/Acts/2018/Chapter121

Action Required: Employers with tipped employees in Massachusetts should familiarize themselves with the new requirements.

As always, please be sure to contact your Payroll Service Representative or HR Business Partner if you have any questions.

This content provides practical information concerning the subject matter covered and is provided with the understanding that ADP is not rendering legal advice.

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Tags: Compliance Corner10/01/18State Update

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