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Comment by bryanlarsen | Hacker News Reader

Note that lots of restaurants do this too. Federal law lets an employer steal the first $5.12 of tips and many states have similar laws.

From wikipedia:

"The United States of America federal government requires a wage of at least $2.13 per hour be paid to employees that receive at least $30 per month in tips.[4] If wages and tips do not equal the federal minimum wage of $7.25 per hour during any week, the employer is required to increase cash wages to compensate.[5]"

It's phrased to sound like a top-up but it's theft in my opinion.

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I agree.

I'd like two things:

1) Tips to actually be tips, and OPTIONAL.

2) Real wages that are static for the restaurant (a base wage, calculated to properly compensate the employee without tips).

Please stop adding a hidden tax to items on menus.

It works like what you mentioned in most of the world but for some reason, it works differently in United States.

Laws by definition mean it is not theft, but yes, this practice is widespread, legal and has been around far longer than the new tech-oriented contract workforce.

I think the difference is this:

randome example from above DeliverDash offers driver $7-12 range.

DeliverDash pays $7 with no tip, costing them $7

DeliverDash pays $7 with $3 tip, costing them $4

DeliverDash does not pay $2.13 hourly.

DeliverDash does not even have employees doing deliveries. They are contractors.

Am i reading this wrong?

the difference there is that the wage doesn't change with the amount of the tip, and that consistent wage is communicated up front. Yes, the tip-wage sucks, but surprisingly it's more honest than this.

You're gonna have to explain that one more

Restaurants advertise an hourly rate ($7.25/hr or $15/hr, whatever) but in reality it is $2.13 + tips.

In NYC the tip credit is something like $5. Which means employers have the option to pay $10-$15 (min wage in NYC is $15) when employee is also paid tips. When the employee’s paycheck is calculated, and their (tips + wages) / hours < $15, then the balance is paid by the employer. In NYC, it is therefore illegal to pay less than $10/hr in wages. https://www.labor.ny.gov/formsdocs/wp/CR146.pdf

do you consider servers not declaring 100% of their tips theft as well?

What exactly are you arguing here?

That jobs where most of the pay is in tips cut both ways: sometimes you don't get paid minimum wage, but it's cash so you declare your own taxable income.

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