An Act To Restore the Tip Credit to Maine's Minimum Wage Law
Maine Legislature, Session 128, LD 0673
Committee Amendment CA_A_S209 (Senate)
Amends: 26 MRSA §664

COMMITTEE AMENDMENT "A " to S.P. 235, L.D. 673, Bill, "An Act To 
Restore the Tip Credit to Maine's Minimum Wage Law" 
Amend the bill by inserting after the title and before the enacting clause the 
following: 
'Emergency preamble. Whereas, acts and resolves of the Legislature do not 
become effective until 90 days after adjournment unless enacted as emergencies; and 
Whereas, tourism is a vital industry in Maine; and 
Whereas, the restaurant and hospitality industries are essential components of the 
tourism industry; and 
Whereas, tipped service employees are of crucial importance to the restaurant and 
hospitality industries; and 
Whereas, adjustment to the minimum wage laws concerning tipped service 
employees is necessary before the summer tourism season begins; and 
Whereas, in the judgment of the Legislature, these facts create an emergency within 
the meaning of the Constitution of Maine and require the following legislation as 
immediately necessary for the preservation of the public peace, health and safety; now, 
therefore,' 
Amend the bill by striking out everything after the enacting clause and before the 
summary and inserting the following: 
'Sec. 1. 26 MRSA §664, sub-§2, as amended by IB 2015, c. 2, §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. Starting except that from January 1, 2017 to December 31, 
2017, the minimum cash wage paid directly to a tipped service employee may not be less 
than $5.00 per hour, aRd the tip oredit may not e1t0eed the differenoe betv1een the 
COMMITTEE AMENDMENT 
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~o 
COMMITTEE AMENDMENT "A "to S.P. 235, L.D. 673 
minimum oash wage paid direotly to a tipped servioe employee and the minimum hourly 
'i'fage established under subseotion 1. £tarting January 1, 2018, and on eaoh January 1st 
thereafter, the minimum oash v,rage paid direotly to a tipped servioe employee must be 
inoreased by an additional $1.00 per hour until it reaohes the same amount as the annually 
adjusted minimum hourly wage established under subseotion 1, exoept that if the 
minimum oash wage paid direotly to a tipped servioe employee is less than $1.00 less 
than the annually adjusted minimum hourly wage, it must be inoreased by that lesser 
amount. An employer who elects to use the tip credit, until it is eliminated under this 
subseotion, must inform the affected employee in advance, as provided for in this 
subsection, 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 within the established 7-
day workweek. 
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. Tips that are automatically included in the customer's 
bill or that are .charged to a credit card must be treated like tips 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. The employer may not deduct any amount 
from employee tips charged to a credit card, including, but not limited to, service fees 
assessed to the employer in connection with the credit card transaction. 
An employer who elects to use the tip credit must inform the affected employee in 
advance, either orally or in writing, of the following information: 
A. The amount of the direct wage to be paid by the employer to the tipped employee; 
B. The amount of tips to be credited as wages toward the minimum wage; 
C. That the amount of tips to be credited as wages may not exceed the value of the 
tips actually received by the employee; 
D. That all tips received by the affected employee must be retained by the employee, 
except for a valid tip pooling arrangement limited to employees who customarily and 
regularly receive tips in accordance with subsection 2-A; 
E. That the tip credit may not apply to any employee who has not been informed by 
the employer of the provisions for a tip credit; and 
F. If the employer uses a tip pooling arrangement, any required tip pool contribution 
amount from the employee. 
Emergency clause. 
In view of the emergency cited in the preamble, this 
legislation takes effect when approved.' 
SUMMARY 
This amendment keeps the provisions in the bill restoring the tip credit in the 
minimum wage laws, and it makes the following additional changes to current law. 
COMMITTEE AMENDMENT 
I 
COMMITIEE AMENDMENT" 4 
"to S.P. 235, L.D. 673 
I. It clarifies that for purposes of the tip credit, wages must be measured in the 
context of the 7-day workweek. 
2. It clarifies that an employer may not deduct any amount from employee tips 
charged to a credit card, including, but not limited to, service fees assessed to the 
employer in connection with the credit card transaction. 
3. It adopts the current requirements in federal law, found at 29 Code of Federal 
Regulations, Section 531.54 and 29 Code of Federal Regulations, Section 53 l.59(b ), 
requiring an employer to provide notice to employees affected by the employer's use of a 
tip credit and the employer's use of a tip pooling arrangement. 
IO 
The amendment also adds an emergency preamble and clause. 
FISCAL NOTE REQVDW> 
(See attedled) 
COMMITTEE AMENDMENT 
Approved: 05/17 /17 feac 
LD 673 
LR252(02) 
An Act To Restore the Tip Credit to Maine's Minimum Wage Law 
Fiscal Note for Bill as Amended by Committee Amendment ';,d; l S -do:) 
Committee: Labor, Commerce, Research and Economic Development 
Fiscal Note Required: Yes 
Fiscal Note 
Minor cost increase - General Fund 
Fiscal Detail and Notes 
Additional costs to the Depannent of Labor, Bureau of Labor Standards, associated with enforcing the requirements 
of this legislation can be absorbed within existing budgeted resources. 
LR0252(02) - Fiscal Note - Page 1 of 1