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In California, the minimum wage for servers in 2023 is $15.50 per hour.
In some cities and counties, the minimum wage is higher.
Unlike in some other states, servers and other workers in California are entitled to minimum wage in addition to the tips they earn.
Do California’s minimum wage laws apply to servers?
Yes, California’s minimum wage law applies to tipped employees such as waiters, waitresses, bartenders, and valets.
California Labor Code 351 LAB states that your tips are your sole property. If you receive a tip from a customer, it belongs to you. Importantly, this means that your employer is not allowed to:
- take your tip,
- share your tip with owners, managers, or supervisors, or
- use the gratuity as a tip credit to justify paying you less than the applicable minimum wage.1
A tip includes any money left by a customer for an employee that is not required to cover the goods or services provided by the employee.2
What is the minimum wage in California?
California’s current minimum wage is $15.50 per hour. As of July 1, 2023, many cities have a higher minimum wage, such as:
- Alameda, which has a minimum wage of $16.52 per hour.3
- Berkeley, which has a minimum wage of $18.07 per hour.4
- City of Los Angeles, which has a minimum wage of $16.78 per hour.5
- Oakland, which has a minimum wage of $15.97 per hour.6
- San Francisco, which has a minimum wage of $18.07 per hour.7
- San Jose, which has a minimum wage of $17.00 per hour.8
- Santa Monica, which has a minimum wage of $16.90 per hour.9
California’s minimum wage laws are among the highest in the country. It has been incrementally increasing every year since 2017.10
Employers cannot contract around these minimum wage laws. Also, you cannot legally waive your rights to be paid a minimum wage.
How does this compare to the tipped minimum wage elsewhere?
The minimum wage for employees who receive tips is far higher in California than it is in many other states.
Federal law
The minimum wage under federal law is $7.25 per hour. Under the FLSA, though, tipped workers are not even entitled to that minimum wage.11
Instead, employers only have to pay them a minimum cash wage of $2.13 per hour.12 Employers can then use the employee’s gratuities as a tip credit towards the employer’s minimum wage obligations.13
Under the FLSA, then, the law requires a $2.13 minimum cash wage and then allows a $5.12 tip credit to reach the federal minimum wage of $7.25.
Worst states for tipped employees
Some states do not offer more than the federal minimum wage to tipped employees. Some of these states include:
- Alabama,
- Georgia,
- Kansas,
- Mississippi,
- North Carolina,
- Texas, and
- Utah.14
Middle-ground states for tipped employees
Others offer a higher minimum cash wage to tipped employees, but one still lower than the normal state minimum wage, relying on a tip credit to make up the difference. This brings a server’s guaranteed wage closer to the minimum, but not all the way. For example, servers in:
- Arkansas get a minimum cash wage of only $2.63, and have to rely on a $8.37 tip credit to reach the state’s normal minimum wage,
- Colorado get $10.63 in minimum cash wages and have to rely on a $3.02 tip credit,
- the District of Columbia receive $8.00 in minimum cash wages and rely on $8.10 in tip credits to reach the normal minimum, and
- Hawaii get $11.00 in minimum cash wages and have to rely on a $1.00 tip credit.15
Best states for tipped employees
Other states require all employers to pay tipped employees the full state minimum wage. The tips are then received as compensation above and beyond the minimum wage. These states are:
- Alaska,
- California,
- Minnesota,
- Nevada
- Oregon, and
- Washington.
In some of these states, there are additional details. For example, in Nevada, employers have to pay a higher wage to tipped employees if they do not offer health insurance.16
Other variations between states
The FLSA defines “tipped employees” as receiving more than $30 per month in tips, though other states define “tipped employees” differently. Some examples are:
- Massachusetts, which only require $20 in tips per month, and
- Vermont, which requires at least $120 per month.17
Some states have different rules for businesses that make over a certain amount. Montana, for example, requires a minimum cash wage of $4.00 for businesses that gross less than $110,000 per year, but $9.95 for those that make more than that.18
What if my employer is violating the law?
If your California employer is not complying with state minimum wage law or is taking your tips, you can sue your employer to recover your lost wages plus interest and attorneys’ fees.19 You can also recover a civil penalty of:
- $100 for the initial pay period with the violation, and
- $250 for each subsequent pay period.20
Criminal penalties
If your employer violated California Labor Code 351 LAB and took your tips, they can be charged with a crime. The offense is a misdemeanor that is punishable with up to:
- 60 days in jail, and/or
- $1,000 in fines.21
Other legal recourses
In addition to bringing a wage and hour lawsuit , you can also sue your employer for:
- conversion,22
- violating California’s unfair competition law,23 and
- breach of implied contract.24
If you do not want to go to such an extent as filing a lawsuit, you can also file a complaint with the California Labor Commissioner’s Office.25 The Office will hold a hearing regarding the alleged tip law violations. If successful, you can recover your unpaid tips.
Can undocumented servers get minimum wage?
Yes. If you are an undocumented immigrant working as a server in California, the minimum wage laws apply to you. In addition, you are protected by the following laws:
- AB 263, which forbids employers from threatening you by using your undocumented status in order to retaliate against you for demanding your labor rights;
- AB 450, which entitles you to due process in I-9 worksite audits; and
- AB 524, which makes your employer criminally liable if they threaten you in relation to your undocumented status.
If you are undocumented and being deprived of your wages, you have the same legal recourses as described in the previous section.26
Legal References:
- O’Grady v. Merchant Exchange Productions, Inc., 41 Cal.App.5th 771 (2019).
- 29 USC 203(t). See California Labor Code 350. Generally, a tipped employee is any employee who customarily and regularly receives more than $30 per month in tips. This definition comes from the federal Fair Labor Standards Act (FLSA). However, many state employment laws alter this definition. Generally, tipped employees do not have to be paid the minimum wage by the employer. Many states allow employers to pay tipped employers an hourly wage that is well below the minimum. States allow for a “tip credit” to make up what is necessary to reach the state’s regular minimum wage. In California, however, state laws make the distinction between tipped and non-tipped employees meaningless for minimum wage purposes. Regardless of whether you typically earn more than $30 in tips per month, you are still entitled to the applicable minimum wage in the state.
- City of Alameda, Minimum Wage.
- See City of Berkeley Minimum Wage Ordinance.
- See Los Angeles, Office of Wage Standards.
- City of Oakland, Minimum Wage Ordinance.
- City of San Francisco, Minimum Wage Ordinance.
- Office of the City Manager of San Jose, Minimum Wage.
- Minimum Wage, City of Santa Monica.
- California Senate Bill 3 (2016); California Labor Code 1182.12.
Year California Minimum Wage for Employers with 26 or More Employees California Minimum Wage for Employers with 25 or Fewer Employees 2017 $10.50 per hour $10.00 per hour 2018 $11.00 per hour $10.50 per hour 2019 $12.00 per hour $11.00 per hour 2020 $13.00 per hour $12.00 per hour 2021 $14.00 per hour $13.00 per hour 2022 $15.00 per hour $14.00 per hour 2023 $15.50 per hour $15.50 per hour - 29 USC 203(m).
- 29 CFR 531.50.
- 29 USC 203(m)(2)(A).
- See U.S. Department of Labor, Wage and Hour Division, “Minimum Wages for Tipped Employees” (Jan. 1. 2022).
- Same.
- Same.
- See note 2. Same.
- Same.
- California Labor Code 1194. Learn more about California wage and hour laws.
- California Labor Code 1197.1.
- California Labor Code 354.
- Lu v. Hawaiian Gardens Casino, 50 Cal.4th 592 (2010).
- O’Grady, supra note 1.
- Same.
- California Labor Code 355.
- See also the federal FLSA (Fair Labor Standards Act) and the MSPA (Migrant and Seasonal Agricultural Worker Protection Act). See also Fact Sheet #48: Application of U.S. Labor Laws to Immigrant Workers: Effect of Hoffman Plastics decision on laws enforced by the Wage and Hour Division (“The Department’s Wage and Hour Division will continue to enforce the FLSA and MSPA without regard to whether an employee is documented or undocumented.”).
About the Author
Neil Shouse
A former Los Angeles prosecutor, attorney Neil Shouse graduated with honors from UC Berkeley and Harvard Law School (and completed additional graduate studies at MIT). He has been featured on CNN, Good Morning America, Dr Phil, The Today Show and Court TV. Mr Shouse has been recognized by the National Trial Lawyers as one of the Top 100 Criminal and Top 100 Civil Attorneys.