Georgia Minimum-Wage and Tip-Credit Rules: What Hospitality Workers Need to Know

Georgia Minimum Wage and Tip-Credit Rules: Key Takeaways

Georgia follows the federal minimum wage of $7.25 per hour, with a tip credit of up to $5.12 per hour allowed for tipped employees.
Employers can pay a base wage of $2.13 per hour to tipped employees, provided tips bring total earnings to at least $7.25; if not, the employer must compensate the difference.
The Department of Labor's 80/20 rule limits tip credits to the time employees spend on tip-producing activities, requiring full minimum wage for non-tip tasks.

This article provides Georgia hospitality workers with essential information on minimum wage and tip-credit rules.

It explains key employer and employee obligations and highlights tip pooling and other important wage regulations.

1. Georgia Minimum Wage and Tip-Credit Rules Explained

Georgia adopts the federal minimum wage law, which sets the base hourly wage at $7.25. Hospitality workers who earn tips can be paid a lower base wage if their tips make up the difference.

The federal tip credit allows employers to pay tipped employees as little as $2.13 per hour in direct wages, with the remaining $5.12 accounted for as tips.

If an employee's combined wages and tips do not reach $7.25 per hour, the employer must pay the shortfall to meet the minimum wage requirement.

This ensures that tipped employees receive at least the full minimum wage regardless of tips earned.

For employers looking for guidance, our guide to hiring restaurant staff provides valuable insights on recruiting and managing hospitality employees effectively.

2. Tip Pooling and Mandatory Service Charges in Georgia Hospitality

Employers in Georgia are allowed to implement mandatory tip pooling, which requires tipped employees to share a portion of their tips with other staff who customarily receive tips, such as bussers or bartenders.

However, managers, supervisors, and employees who do not traditionally receive tips are prohibited from participating in the tip pool.

It's important to understand that mandatory service charges added to a customer's bill are not considered tips under state or federal law.

These charges belong to the employer, who may choose to distribute portions to employees, but this is not legally required.

Employers managing tip pooling may benefit from our ultimate tip pooling spreadsheet template to keep records transparent and compliant.

3. Understanding the 80/20 Rule for Tip Credits in Georgia

The Department of Labor has an important guideline known as the 80/20 rule, which impacts tip-credit eligibility.

This rule states that tipped employees who spend more than 20% of their workweek performing non-tip-producing tasks — such as cleaning or setting tables — cannot have tip credits applied to those hours.

For the non-tip-producing time beyond 20%, employers must pay the full minimum wage rather than the tipped minimum.

Compliance with this rule protects employees from being underpaid for work that does not generate tips.

Hospitality employers can refer to our detailed article on the restaurant wage comparison by state to understand how Georgia stacks up in terms of wages.

4. Employer Obligations and Employee Rights under Georgia Tip-Credit Laws

Employers must provide written notice to tipped employees before applying a tip credit.

This notice should detail the tip credit amount, the base wage, and how tips affect total compensation.

Accurate record-keeping is also required, including documenting tips received and hours worked, to ensure compliance with wage laws.

Employees in Georgia have the right to receive at least the minimum wage in total compensation and to retain all their tips except in lawful tip pooling arrangements.

For hiring and labor compliance tips, see our costs for hiring in hospitality spotlight.

5. Local Ordinances and Additional Considerations for Georgia Hospitality Workers

While Georgia state law follows federal minimum wage and tip regulations, some cities may adopt local ordinances that enhance wage protections.

Hospitality workers should stay informed about local wage laws that may affect their earnings and employer obligations.

Employers must remain aware of both state and local requirements to ensure full compliance.

Advice for employers on effective hiring can be found in our how to hire a restaurant manager guide.

6. Best Resources for Georgia Hospitality Workers on Minimum Wage and Tip Credit

To learn more about minimum wage and tip-credit rules, Georgia hospitality workers and employers can consult official sources:

Additional detailed job descriptions and career guidance for positions relevant in Georgia hospitality include the bartender job description and the busser job description.

Georgia Minimum Wage and Tip-Credit Rules: Conclusion

Understanding Georgia’s minimum wage and tip-credit rules is vital for both hospitality workers and employers to ensure fair pay and compliance.

The state follows federal minimum wage standards, allowing a tip credit but requiring total compensation to meet at least $7.25 per hour.

Awareness of tip pooling rules, the 80/20 rule, mandatory service charges, and employer notifications can help workers know their rights and employers meet legal obligations.

Employers interested in learning best practices for managing and retaining staff may find our strategies to reduce restaurant employee turnover useful.

01. What is the federal minimum wage and tip credit in Georgia?

Georgia follows the federal minimum wage of $7.25 per hour, and employers may take a tip credit of up to $5.12 per hour for tipped employees.

02. Who can be required to participate in a tip pool in Georgia?

Only tipped employees who customarily and regularly receive tips—like servers, bussers, and bartenders—can be required to participate in a tip pool. Managers and supervisors are excluded.

03. What is the 80/20 rule for tip credits?

The 80/20 rule states tipped employees who spend more than 20% of their time on non-tip-producing tasks are not eligible for tip credits for those hours. Employers must pay full minimum wage for non-tip time.

04. Are mandatory service charges considered tips in Georgia?

No. Mandatory service charges are considered employer revenue, not tips, though employers may choose to distribute some to employees.

05. What employer obligations exist under Georgia tip-credit laws?

Employers must provide written notice about tip credit provisions, accurately record tips and hours worked, and ensure employees receive at least minimum wage in total compensation.