Employment Law Questions? Ask an Employment Lawyer.
This pay scheme is not legal. What you are essentially describing is a piece rate pay model with a tip credit against the piece rate. Piece rate is not a legitimate pay system for your occupation. You must be paid an hourly wage of $8.25. For tipped employees the employer can deduct up to 40% of this ($3.30 per hour) if you make at least that on average per hour in tips. So they could theoretically pay you $4.95 per hour plus tips. Anything lower than that however is a wage violation that you should consider reporting to the department because this pay system is completely non-conforming with the law.
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