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Because the minimum wage under US law for a tipped job is $2.13/hour and most find it socially and morally problematic to deny that person their primary source of income.This is a common but incorrect meme and misunderstanding. Setting aside that the federal min wage of $7.25/hr is a universal floor and states can (and many do) go much higher, the difference for tipped jobs is that it becomes a "guaranteed minimum" instead of "guaranteed payment". Ie, for an untipped job, the employer must simply pay minimum wage or higher, period. For a tipped job, the employer must pay the $2.13/hr no matter what, but if the amount of tips the employee gets plus averages out to being equal or greater than $7.25/hr the employer doesn't need to pay more. However, if the employee does not get enough tips to reach $7.25/hr, the employer must make up the difference. So ultimately nobody is allowed to end up with less than minimum wage. The law just allows a different path to get there for tipped employees. If nobody tipped at all, employees would still get minimum wage (or higher).
Of course, it's completely reasonable to argue that federal minimum wage itself is disgustingly low. It doesn't auto-adjust to reflect inflation, and the highest purchasing power it ever had was back in 1968. Congress last increased it to $7.25 in 2009 and has left it that way 17 years later. Even by official definitions of the federal poverty line (themselves grossly outdated underestimates), minimum wage is below it. But it's still not good to confuse the matter by claiming any employer is legally allowed to let their employees end up with below minimum wage (that some certainly break the law is important too of course).
Edit: Straight from the horse's mouth (department of labor's FLSA page):
>The Fair Labor Standards Act (FLSA) requires payment of at least the Federal minimum wage to covered, nonexempt employees. An employer of a tipped employee is only required to pay $2.13 an hour in direct wages if that amount plus the tips received equals at least the Federal minimum wage, the employee retains all tips and the employee customarily and regularly receives more than $30 a month in tips. If an employee's tips combined with the employer's direct wages of at least $2.13 an hour do not equal the Federal minimum hourly wage, the employer must make up the difference.
>Some states have minimum wage laws specific to tipped employees. When an employee is subject to both the Federal and state wage laws, the employee is entitled to the provisions which provides the greater benefits.
This is a common but incorrect meme and misunderstanding. Setting aside that the federal min wage of $7.25/hr is a universal floor and states can (and many do) go much higher, the difference for tipped jobs is that it becomes a "guaranteed minimum" instead of "guaranteed payment". Ie, for an untipped job, the employer must simply pay minimum wage or higher, period. For a tipped job, the employer must pay the $2.13/hr no matter what, but if the amount of tips the employee gets plus averages out to being equal or greater than $7.25/hr the employer doesn't need to pay more. However, if the employee does not get enough tips to reach $7.25/hr, the employer must make up the difference. So ultimately nobody is allowed to end up with less than minimum wage. The law just allows a different path to get there for tipped employees. If nobody tipped at all, employees would still get minimum wage (or higher).
Of course, it's completely reasonable to argue that federal minimum wage itself is disgustingly low. It doesn't auto-adjust to reflect inflation, and the highest purchasing power it ever had was back in 1968. Congress last increased it to $7.25 in 2009 and has left it that way 17 years later. Even by official definitions of the federal poverty line (themselves grossly outdated underestimates), minimum wage is below it. But it's still not good to confuse the matter by claiming any employer is legally allowed to let their employees end up with below minimum wage (that some certainly break the law is important too of course).
Edit: Straight from the horse's mouth (department of labor's FLSA page):
>The Fair Labor Standards Act (FLSA) requires payment of at least the Federal minimum wage to covered, nonexempt employees. An employer of a tipped employee is only required to pay $2.13 an hour in direct wages if that amount plus the tips received equals at least the Federal minimum wage, the employee retains all tips and the employee customarily and regularly receives more than $30 a month in tips. If an employee's tips combined with the employer's direct wages of at least $2.13 an hour do not equal the Federal minimum hourly wage, the employer must make up the difference.
>Some states have minimum wage laws specific to tipped employees. When an employee is subject to both the Federal and state wage laws, the employee is entitled to the provisions which provides the greater benefits.