Rhode Island Poised to Raise Minimum Wage for Tipped Employees

Author: Michael Cardman, XpertHR Legal Editor

June 29, 2015

Less than a week after a minimum wage increase was enacted for all workers, Rhode Island's legislature has passed a bill that would raise the minimum cash wage for tipped employees as well.

Currently, a Rhode Island employer may count employees' gratuities as part of the applicable minimum wage rate, as long as the cash wage does not fall below $2.89 per hour.

If Governor Gina Raimondo signs the bill as expected, the minimum cash wage for tipped workers would increase from $2.89 to $3.39 on January 1, 2016, and to $3.89 on January 1, 2017.

The bill is the latest example of minimum wage increases that spread from state to state. The bill's sponsors cited the higher minimum wages for tipped employees in New York and Connecticut as a reason to increase the minimum wage for tipped employees in Rhode Island.

There is considerable variation in state minimum wage rates, with concentrations of higher minimum wage rates on the coastal states. The northeast has the highest average minimum wage rate of the nation's four main geographical regions.