REPORT TITLE:
Tip Credit


DESCRIPTION:
Protects employees who receive or may receive tips or gratuities
during the course of employment from having these amounts
withheld or credited to their employers.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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HOUSE OF REPRESENTATIVES                H.B. NO.           
TWENTIETH LEGISLATURE, 2000                                
STATE OF HAWAII                                            
                                                             
________________________________________________________________
________________________________________________________________


                   A  BILL  FOR  AN  ACT

RELATING TO WAGES AND TIPS OF EMPLOYEES. 


BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 1      SECTION 1.  The legislature finds that Hawaii's wage and
 
 2 hour laws do not protect employees who receive or may receive
 
 3 tips or gratuities during the course of their employment from
 
 4 having these amounts withheld or credited to their employers.
 
 5      SECTION 2.  Section 387-1, Hawaii Revised Statutes, is
 
 6 amended as follows:
 
 7      1.  By adding a new definition to be appropriately inserted
 
 8 and to read:
 
 9      ""Tips" means gratuities in the form of money paid by a
 
10 customer or added to a customer's charge either voluntarily or as
 
11 a service charge by the employer."
 
12      2.  By amending the definition of "wages" to read:
 
13      ""Wage" means (except as the department may provide under
 
14 section 387-11) legal tender of the United States or checks on
 
15 banks convertible into cash on demand at full face value thereof
 
16 and in addition thereto the reasonable cost as determined by the
 
17 department, to the employer of furnishing an employee with board,
 
18 lodging, or other facilities if such board, lodging, or other
 
19 facilities are customarily furnished by such employer to the
 

 
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 1 employer's employees.  Except [for the purposes of the last
 
 2 sentence of section 387-2,] that "wage" shall not include tips or
 
 3 gratuities of any kind."
 
 4      SECTION 3.  Section 387-2, Hawaii Revised Statutes, is
 
 5 amended to read as follows:
 
 6      "�387-2 Minimum wages.  Except as provided in section 387-9
 
 7 and this section, every employer shall pay to each employee
 
 8 employed by the employer wages at the rate of not less than
 
 9 [$3.85 per hour beginning January 1, 1988, $4.75 per hour
 
10 beginning April 1, 1992, and] $5.25 per hour beginning January 1,
 
11 1993.  [The hourly wage of a tipped employee may be deemed to be
 
12 increased on account of tips if the employee is paid not less
 
13 than twenty cents below the applicable minimum wage by the
 
14 employee's employer and the combined amount the employee receives
 
15 from the employee's employer and in tips is at least fifty cents
 
16 more than the applicable minimum wage.]" 
 
17      SECTION 4.  Section 388-1, Hawaii Revised Statutes, is
 
18 amended by amending the definition of "wages" to read as follows:
 
19      ""Wages" means compensation for labor or services rendered
 
20 by an employee, whether the amount is determined on a time, task,
 
21 piece, commission, or other basis of calculation.  It shall
 
22 include the reasonable cost, as determined by the director under
 
23 chapter 387, to the employer of furnishing an employee with
 

 
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                                     H.B. NO.           
                                      
                                                        

 
 1 board, lodging, or other facilities if such board, lodging, or
 
 2 other facilities are customarily furnished by the employer to the
 
 3 employer's employees but shall not include tips or gratuities of
 
 4 any kind[, provided that for the purposes of section 388-6,
 
 5 "wages" shall include tips or gratuities of any kind]."
 
 6      SECTION 5.  Section 388-6, Hawaii Revised Statutes, is
 
 7 amended to read as follows:
 
 8      "�388-6 Withholding of wages[.]; tips.  No employer may
 
 9 deduct, retain, or otherwise require to be paid, any part or
 
10 portion of any compensation or tip earned by, or ascribed on a
 
11 customer's bill or charge as a tip or gratuity to, any employee
 
12 except where required by federal or state statute or by court
 
13 process or when such deductions or retentions are authorized in
 
14 writing by the employee, provided that the following may not be
 
15 so authorized, or required to be borne by the employee:
 
16      (1)  Fines;
 
17      (2)  Cash shortage in a common money till, cash box, or
 
18           register used by two or more persons; or cash shortage
 
19           in a money till, cash box, or register under sole
 
20           control if the employee is not given an opportunity to
 
21           account for all moneys received at the start of a shift
 
22           and all moneys turned in at the end of a shift;
 
23      (3)  Fines, penalties, or replacement costs for breakage;
 

 
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 1      (4)  Losses due to acceptance by an employee of checks which
 
 2           are subsequently dishonored if employee is given
 
 3           discretion to accept or reject any check;
 
 4      (5)  Losses due to defective or faulty workmanship, lost or
 
 5           stolen property, damage to property, default of
 
 6           customer credit, or nonpayment for goods or services
 
 7           received by customer if such losses are not
 
 8           attributable to employee's wilful or intentional
 
 9           disregard of employer's interest; or
 
10      (6)  Medical or physical examination or medical report
 
11           expenses which accrue due to services rendered to an
 
12           employee or prospective employee, where such
 
13           examination or report is requested or required by the
 
14           employer or prospective employer or required by any law
 
15           or regulation of federal, state or local governments or
 
16           agencies thereof."
 
17      SECTION 6.  Statutory material to be repealed is bracketed.
 
18 New statutory material is underscored.
 
19      SECTION 7.  This Act shall take effect upon its approval.
 
20 
 
21                       INTRODUCED BY:  ___________________________