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Senate of Pennsylvania
Session of 2021 - 2022 Regular Session


Posted: December 9, 2020 02:33 PM
From: Senator Christine M. Tartaglione
To: All Senate members
Subject: Eliminating Credit Card Deductions from Tips
In the near future, I intend to re-introduce legislation that would amend Pennsylvania’s Minimum Wage Act to prohibit employers from deducting business costs from gratuities paid to employees. Specifically, my legislation would require any employer who permits customers to pay gratuities by credit card to pay their employees the full amount of the gratuity indicated on the credit card slip. No deductions may be made for any fees or costs the credit card company may charge to the employer. This bill was introduced as SB 79 in the 2019-20 session and passed the Senate by a vote of 42-7. Members who co-sponsored this legislation previously include Senators Fontana, Schwank, Street, Hughes, Costa, Brewster, Browne, Haywood, Yudichak, Leach and Iovino.

In Pennsylvania, minimum wage employees who make at least $30 per month in tips are considered tipped workers. By law, they must be paid at least $2.83 per hour, and the rest of their wages are earned from customer tips. Unfortunately, when a customer uses a credit card to pay gratuity at a bar or restaurant, employers often require their tipped employees to subtract from their gratuities processing fees charged by credit card companies. This business practice is both costly and unfair to tipped workers, as it diminishes their take-home pay and penalizes them for a customer’s decision to use an employer-sanctioned method of payment.

It is in the best interest of our Commonwealth to end any practices that are unfair to tipped employees, as they should be paid the full amount of gratuity intended by their customers. I hope you will support this important legislation to protect the rights of tipped workers throughout the Commonwealth.

Introduced as SB331