Maryland Legislature to Look at Bill That Would No Longer Count Tips Towards Minimum Wage

Maryland legislature will be looking at a bill on March 2 that would abolish the “tip credit”. Employers in the state of Maryland (and most other states across the country) are permitted to count customer tips toward the minimum hourly wage they must pay to certain service employees. This is often referred to as a “tip credit.” A tip credit allows the employer to pay employees a wage that is less than the minimum wage by relying on tips the employee receives from customers to make up the difference. In November, DC voted to approve “Initiative 82”, which gradually eliminates the tip credit until its fully eliminated by 2027.

Synopsis of the bill, courtesy of the Maryland General Assembly: Specifying a certain tip credit amount that is in effect for certain time periods; prohibiting certain employers of tipped employees, beginning July 1, 2027, from including a tip credit amount as part of the employees’ wages; and requiring the Commissioner of Labor and Industry to establish the High Road Kitchen Program as a recognition program for restaurants that do not include the tip credit as part of certain employees’ wages.

It will be heard in the Senate at 1pm on March 2.