New Jersey Tip Pooling Laws (2026)
New Jersey allows required tip pools and says tips belong to employees whether or not the employer takes a tip credit. State guidance says pooled tips may not go to non-tipped employees, employers may not take any part of a card processing fee out of tips, and the tipped cash wage is $6.05 an hour in 2026, rising to $6.61 on January 1, 2027.
Last reviewed October 11, 2026.
At a glance
| Minimum wage | $15.92 an hour in 2026 (most employers); $16.48 from January 1, 2027 |
|---|---|
| Tipped cash wage | $6.05 an hour; $6.61 from January 1, 2027 (credit fixed at $9.87) |
| Required tip pools | Allowed; contribution amounts must be disclosed |
| Back-of-house in a pool | Not to non-tipped employees, per state guidance |
| Card fees taken from tips | Not allowed |
| Side work | No tip credit for related duties above 20% of the workweek |
| Service charges | Not tips |
Tipped wage
New Jersey’s tip credit is fixed at $9.87 an hour, so the tipped cash wage moves with the minimum: $6.05 on the $15.92 minimum in 2026 and $6.61 on the $16.48 minimum from January 1, 2027 (N.J.S.A. 34:11-56a4). Tipped workers do not get the lower rate for small and seasonal employers. A tipped employee must customarily and regularly receive more than $30 a month in tips, and no tip credit can be taken for time on related duties above 20 percent of the workweek (N.J.A.C. 12:56-3.5).
Who can share in a tip pool
Tips go back to the employee except when they are pooled, either voluntarily by employees or as a policy of management (N.J.A.C. 12:56-8.4). An employer must tell employees about any required pool contribution, may take a tip credit only for the tips each employee ends up with, and may not keep any tips (12:56-3.5).
The state Department of Labor’s guidance says an employer that pools tips may not distribute them to non-tipped employees, and it gives no exception for employers that take no tip credit. Unless you get legal advice otherwise, keep kitchen staff out of the pool.
Managers
Tips are the employee’s property whether or not the employer takes a tip credit. New Jersey has no definition of manager for tip pools, so the federal rule applies: managers and supervisors may not receive tips from a pool.
Credit card tips
New Jersey bans using an employee’s tips to pay any portion, however small, of the card company’s fee (N.J.A.C. 12:56-3.5). The Department of Labor calls card fees a cost of doing business, like rent or utilities.
Service charges
A compulsory service charge is not a tip, even if the employer distributes it to employees, and a large-party surcharge is not a tip either.
Notice and records
Before taking a tip credit, the employer must tell the employee the cash wage, the credit amount, that tips are kept by the employee except in a valid pool, and that the credit does not apply to anyone who was not told. Records, including each employee’s total tips for each payroll week, are kept for six years.
New Jersey tip pooling FAQ
What is the tipped minimum wage in New Jersey?
$6.05 an hour in 2026 and $6.61 from January 1, 2027, with the tip credit fixed at $9.87.
Can a New Jersey employer take credit card fees out of tips?
No. The rules bar using tips to pay any part of a card processing fee.
Can kitchen staff be in a tip pool in New Jersey?
State guidance says pooled tips may not go to non-tipped employees, with no exception for employers that pay the full minimum wage. Unless you get legal advice otherwise, keep back-of-house staff out of the pool.
Does New Jersey have an 80/20 rule?
Yes. No tip credit may be taken for time spent on related duties above 20 percent of the workweek.
Official sources
- N.J.S.A. 34:11-56a4 (via NJDOL release, 2025)
- NJDOL: 2027 minimum wage release
- NJDOL: Tipped workers
- N.J.A.C. 12:56 adoption, 52 N.J.R. 1562(a)
This page summarizes the law for restaurant operators and staff; it is not legal advice. Wages and rules change, and cities can set their own minimums. Check the linked official sources, or ask an employment lawyer, before changing how you handle tips.