Pennsylvania Tip Pooling Laws (2026)
Pennsylvania follows the federal tip pool model with extras: a pool that includes anyone paid the $2.83 tipped wage is limited to tipped occupations, kitchen staff can join only if everyone is paid at least $7.25, and employees must get written notice of the pool in advance. Employers may not deduct card processing fees from tips, and the state keeps a 20 percent limit on non-tipped side work.
Last reviewed October 11, 2026.
At a glance
| Minimum wage | $7.25 an hour; local minimums preempted |
|---|---|
| Tipped cash wage | $2.83 an hour, only if tips exceed $135 a month |
| Required tip pools | Allowed on the federal model, with written notice |
| Back-of-house in a pool | Only if everyone is paid at least $7.25 |
| Managers | May contribute, never receive |
| Card fees taken from tips | Not allowed |
| Side work | No more than 20% of weekly hours on non-tip duties |
Tipped wage
Pennsylvania’s minimum wage is $7.25 and the tipped cash wage is $2.83, which applies only to employees who get more than $135 a month in tips (34 Pa. Code §§ 231.1, 231.101a). A bill to raise the minimum to $11 in 2027 passed the state House in March 2026 but is not law.
Pennsylvania kept the federal 80/20 rule in its own regulation: a tipped employee cannot spend more than 20 percent of weekly working hours on duties that do not directly produce tips (§ 231.111).
Who can share in a tip pool
Pennsylvania adopted the federal tip pool rule (§ 231.112). If anyone in the pool is paid the tipped wage, the pool can include only occupations that customarily and regularly receive tips; if everyone is paid at least the $7.25 minimum, it can include tipped and non-tipped employees, such as cooks. The employer must give written notice of the pool at or before the job offer, or at least one pay period before the pool takes effect.
Managers
Managers, supervisors and employers may not receive tips from a pool, though they may contribute tips they earned. A manager may keep a patron’s tip only if they provided the entire service without help. Managers and supervisors are employees who meet the federal executive duties test (Department of Labor & Industry).
Credit card tips
The employer must pay the full tip the patron authorized and may not deduct card or other processing fees, including before a pool is divided (§ 231.113).
Service charges
State law says a gratuity added to the bill by management or by the customer becomes the employee’s property (43 P.S. § 333.103). The regulations define a service charge as a mandatory fee that may be distributed to employees as pay but does not count as a tip (§ 231.114). For banquets and special functions, the contract and menus must say the charge does not include a tip, and bills must show service charges and tips on separate lines. Official guidance does not say how an automatic charge at an ordinary restaurant fits between the statute and the regulation.
Records
Employers record tipped employees, tips reported, the tip credit (told to the employee in writing each time it changes), tipped and non-tipped hours and, for pools, each participant’s name, position and payout, and keep the records for three years (§ 231.34).
Pennsylvania tip pooling FAQ
What is the tipped minimum wage in Pennsylvania?
$2.83 an hour, for employees who get more than $135 a month in tips; tips must bring them to at least $7.25.
Can kitchen staff share tips in Pennsylvania?
Only if every employee in the pool is paid at least the $7.25 minimum wage. If anyone gets the tipped wage, the pool is limited to tipped occupations.
Can a Pennsylvania employer deduct credit card fees from tips?
No, not from individual tips and not from a pool before it is divided.
Does Pennsylvania still have the 80/20 rule?
Yes. A tipped employee cannot spend more than 20 percent of weekly working hours on duties that do not directly produce tips.
Official sources
- 34 Pa. Code, chapter 231
- PA Department of Labor & Industry: Overtime and tipped worker rules
- House Bill 2189 (2025-26 session)
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.