Back in 2014, the legislature passed Act 82 Session Laws of Hawaii 2014, that raised Hawaii's minimum wage incrementally to $10.10 per hour by January 1, 2018. As of January 1, 2016, the minimum wage is raised to $8.50 per hour. January 1, 2017, the minimum wage goes up to $9.25 per hour.
Tip credit increases
As part of the minimum wage increase, the tip credit was also increased. As of January 1, 2016, the tip credit is 75 cents. The tip credit remains at 75 cents even when minimum wage increases to $9.25 and $10.10.
Employers with regularly tipped employees who make at least $20 per month in tips ( See Hawaii Administrative Rule 12-20-11), may be eligible to take the tip credit of 75 cents if the employee's tips plus the wage paid equal $15.50. This means that with minimum wage of $8.50, an employer can pay wages of $7.75 if the tips of the employee are equal to $7.75 per hour. Additional records are required to be kept to take this credit, see Hawaii Administrative Rule 12-20-12).
If employees earn less than $7.75 per hour in tips, the employer may be eligible to take a tip credit less than 75 cents. A tip credit guideline published on the Wage Standards Division website provides the details and calculations of these scenarios. See Exhibit 3, ( page 4) for 2016, Exhibit 4 (page 5) for 2017 and Exhibit 5 (page 6) starting January 1, 2018.
Other Resources
Minimum wage poster
Wage and Hour Law, Chapter 387, Hawaii Revised Statutes
Wage Standards Division Website: labor.hawaii.gov/wsd
