NJ tipped wage: $6.05 cash + $9.87 tip credit.
New Jersey allows employers to take a tip credit toward the minimum wage obligation. Tipped workers can be paid a cash wage of $6.05/hr (up from $5.62 in 2025), with up to $9.87 of tips counting toward the $15.92 standard rate. Cash plus tips must reach $15.92 each pay period; if tips fall short, the employer must pay the difference. The maximum tip credit is frozen at $9.87 — meaning each year's CPI bump effectively shrinks the credit's percentage value while raising the cash wage.
Tipped Wage with Tip Credit
Pays $6.05 cash + tracks tips against $9.87 max credit. Reconciles each pay period: cash + tips must reach $15.92. Auto-applies make-up pay on shortfall.
What those rules do as a tipped shift is created and reconciled.
The hero card configuration: Block below cash floor, Critical on shortfall, Block on manager pool participation.
When a tipped worker shift is saved at a cash wage below $6.05, the save fails. The cash wage minimum is statutory and cannot be waived.
At pay period close, total tipped earnings (cash + tips) are reconciled against $15.92 × hours worked. Shortfall triggers automatic make-up pay added to the worker's next paycheck. Reconciliation runs per pay period, not per shift (unlike Massachusetts).
NJ prohibits managers and supervisors from sharing in tip pools. Attempts to add a management role to the pool are blocked, with the prohibition surfaced.
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Cash floor + max credit + period reconciliation.
NJ's tip credit framework follows the federal FLSA model with stricter rules on tip pool composition. The reconciliation cadence (per pay period) is the operational distinction.
Tipped employee definition
A 'tipped employee' under NJ law is an employee who customarily and regularly receives more than $30 per month in tips. The definition tracks the federal FLSA standard. Workers who receive less than $30/month in tips run on the standard $15.92 rate, not the tipped rate. Qualifying occupations typically include: servers, bartenders, food runners, bussers, valet attendants, and similar tipped service roles.
Mandatory employer notice
To apply the tip credit, the employer must give written notice to the tipped employee in advance, stating: (a) the cash wage paid; (b) the tip credit claimed (up to $9.87); (c) that all tips received belong to the employee except in valid tip pool arrangements limited to tipped employees; and (d) that the tip credit cannot exceed actual tips received. Failure to give the notice voids the tip credit — the employer must pay the full $15.92 cash wage.
Teambridge tracks tipped earnings, reconciles per period, and prevents tip pool violations.
Pay-period reconciliation plus the manager-pool prohibition are the operational mechanics most employers get wrong.
Tipped role flag → $6.05 minimum.
When a tipped worker shift is created, the cash wage is validated against the $6.05 minimum. Below the floor → save blocked.
Pool members logged + manager exclusion check.
Workers added to a tip pool are tracked. Manager/supervisor roles attempting pool participation → save blocked. Voluntary back-of-house pools are tracked separately with no-tip-credit requirement enforced.
Cash + tips averaged across period.
At pay period close, total cash + tips are summed and divided by hours worked. Average below $15.92 → make-up pay added to next paycheck. Per-period (not per-shift) reconciliation.
Written notice on file before credit applied.
Tip credit can only be applied if the worker has received the mandatory written notice. Tip credit on a worker without notice on file → blocked, with cash wage defaulted to $15.92.
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