Wisconsin employers must also comply with federal minimum wage laws, which currently sets the federal minimum wage at $7.25. See FLSA: Minimum Wage.
If an employer chooses to pay employees minimum wage, the employer must pay those employees in accordance with the minimum wage law, either federal or state, that results in the employees being paid the higher wage.
Tip minimum wage
Tips are defined as an amount of money given by a customer as a gift or gratuity to an employee in recognition of services performed. Service charges are not tips. Tips are distinguishable from service charges in that customers are solely responsible for deciding whether they will give a tip, how much it will be, and who will receive it. Tips are the property of the employee who receives them. WI Admin. Rules 272.03(c)(1)
Service charges, on the other hand, are compulsory and the amount is fixed or negotiated by the employer. They may not be counted as tips unless they are distributed to employees. WI Admin. Rules 272.03(e) Special gifts received from customers, such as tickets, merchandise, or passes are not tips.
Employers may only pay the tipped minimum wage to tipped employees. A tipped employee is an employee who is engaged in an occupation in which he or she customarily and regularly receives tips from customers. WI Admin. Rules 272.03(12)
Employees customarily and regularly receive tips if they receive them more often than occasionally, but may be less than constant. Employees working in occupations where it is known that they consistently and regularly receive tips qualify as tipped employees. Such occupations include waiters, waitresses, bellhops, taxicab drivers, barbers, or beauty operators. WI Admin. Rules 272.03(2)(f)
If an employer chooses to pay the tipped minimum wage, it must also ensure that the tipped employees receive the standard minimum wage when tipped wages earned are combined with tips received. If a tipped employee is not paid the standard minimum wage when tipped wages earned are combined with tips received, the employer must pay the employee the difference. The difference between the tipped minimum wage and the standard minimum wage is referred to as a tip credit. WI Admin. Rules 272.03(2)(b), (g)
Additionally, it is the employer’s responsibility to have tipped employees sign a tip declaration each pay period and to maintain payroll records to verify that tipped employees were paid the standard minimum wage. WI Admin. Rules 272.03(2)(b)
Tip pooling and sharing
Wisconsin minimum wage laws do not allow employers to require tipped employees to participate in tip pooling or tips sharing arrangements. WI Admin. Rules 272.03(2)(e)(4). Employees may voluntarily agree to participate in a tip pooling and sharing arrangements and may rely on the employer to redistribute tips to participating employees in accordance with the arrangement. After redistribution of pooled tips, employers may only credit employees with the tips received after redistribution. WI Admin. Rules 272.03(2)(d), (e)(4).
Employees with disabilities
Wisconsin minimum wage law allows employers to pay employees with disabilities a subminimum wage rate that is less than the standard minimum wage if they are issued a special certificate to do so from the Wisconsin Department of Workforce Development. The special certificate will specify the wage rate to be paid the employee and the period of time for which it may be paid.
When determining whether to issue a special certificate, the Department of Workforce Development considers the following criteria:
- the nature and extent of the employee’s disabilities relate to the employee’s productivity.
- the wages of experienced nondisabled employees in the vicinity of the same industry performing comparable work under consideration.
- the productivity of a worker with a disability compared to the productivity established for nondisabled employees through the use of verifiable work measurement methods, or the productivity of experienced nondisabled employees working in the vicinity on comparable work.
- the wage rates to be paid to a worker with a disability for work comparable to that performed by experienced nondisabled employees.
When seeking a license authorizing special minimum wage rates for workers with disabilities, employers must agree to the following written assurances:
- in the case of employees paid at hourly rates, they will review the special minimum wage rates at periodic intervals with a minimum interval of once every 6 months.
- the employer will adjust wages for all employees at periodic intervals, with a minimum interval of once each year, to reflect changes in the prevailing wages paid to experienced nondisabled employees employed in the locality for comparable work.
Wisconsin minimum wage laws allow employers to pay opportunity employees (trainees) a subminimum wage of $5.90. WI Admin. Rules 272.03(1)(c) An opportunity employee is an employee who is under the age of 20 and who is working within the first 90 consecutive days after initially being hired by an employer. WI Admin. Rules 272.01(11) Opportunity employees may also be paid a tipped minimum wage of $2.13. WI Admin. Rules 272.03(2)(am)
Wisconsin minimum wage laws do not allow employers to pay apprentices a subminimum wage rate that is less than the standard minimum wage. WI Admin. Rules 272.02
Wisconsin minimum wage laws do not allow employers to pay learners a subminimum wage rate that is less than the standard minimum wage. WI Admin. Rules 272.02
Wisconsin minimum wage laws allow employers to pay student learners a subminimum wage rate that is less than the standard minimum wage if they are issued a special certificate to do so from the Wisconsin Department of Workforce Development. WI Admin. Rules 272.09(15)
A student learner is a student who receives instruction at an accredited school and who is working part-time pursuant to a bona fide school training program. A bona fide school training program is a program that is authorized by the Department of Public Instruction, the Technical College System Board, or other recognized education body, and that provides part-time employment training supplemented by a definitely organized plan of instruction and where proper scholastic credit is given by the school. WI Statute 104.01(7)
Wisconsin minimum wage laws do not allow employers to pay student workers a subminimum wage rate that is less than the standard minimum wage unless they qualify as a student learner as discussed above.