An Act To Amend the Laws Regarding Tips Used in Payment of Service Employees
Maine Legislature, Session 125, LD 0207
Committee: Labor, Commerce, Research and Economic Development
Sponsors: LANGLEY, MASON, THIBODEAU, TRAHAN, KNIGHT, MORRISON
Amends: 26 MRSA §663, 26 MRSA §664

Legislative Document 
No. 207 
S.P. 57 
In Senate, January 27, 2011 
An Act To Amend the Laws Regarding Tips Used in Payment of 
Service Employees 
Reference to the Committee on Labor, Commerce, Research and Economic Development 
suggested and ordered printed. 
JOSEPH G. CARLETON, JR. 
Secretary of the Senate 
Presented by Senator LANGLEY of Hancock. 
Cosponsored by Senators: MASON of Androscoggin, THIBODEAU of Waldo, TRAHAN of 
Lincoln, Representatives: KNIGHT of Livermore Falls, MORRISON of South Portland. 
Be it enacted by the People of the State of Maine as follows: 
Sec. 1.  26 MRSA §663, sub-§8, as amended by PL 2007, c. 367, §1, is further 
amended to read: 
8.  Service employee.  "Service employee" means any employee engaged in an 
occupation, such as waiters, waitresses, bellhops, counter personnel and bartenders who 
serve customers, in which the employee customarily and regularly receives more than 
$30 a month in tips. 
Sec. 2.  26 MRSA §664, sub-§2, as amended by PL 2007, c. 367, §2, is further 
amended to read: 
2.  Tip credit.  An employer may consider tips as part of the wages of a service 
employee, but such a tip credit may not exceed 50% of the minimum hourly wage 
established in this section.  An employer who elects to use the tip credit must inform the 
affected employee in advance and must be able to show that the employee receives at 
least the minimum hourly wage when direct wages and the tip credit are combined.  Upon 
a satisfactory showing by the employee or the employee's representative that the actual 
tips received were less than the tip credit, the employer shall increase the direct wages by 
the difference. 
The tips received by a service employee become the property of the employee and may 
not be shared with the employer.  Service employees may volunteer to pool their tips to 
be split among other service employees or may volunteer to share a part of their tips with 
other employees who do not generally receive tips directly from customers.  Tips that are 
automatically included in the customer's bill or that are charged to a credit card must be 
given to the service employee.  A tip that is charged to a credit card must be paid by the 
employer to the employee by the next regular payday and may not be held while the 
employer is awaiting reimbursement from a credit card company. 
SUMMARY 
This bill changes the laws regarding the tip credit for employers as used in the 
payment of service employees by eliminating the provision that specifies that tips 
received by a service employee are the property of the employee and may not be shared 
with the employer.  It eliminates the provision that makes tip splitting voluntary and also 
eliminates the provision that tips automatically included in a customer's bill or charged to 
a customer's credit card must be given to the service employee.  It also eliminates the 
provision that directs the employer to pay the service employee by the next regular 
payday for tips charged to a credit card.