As an expert in labor economics and employment law, I can provide a detailed explanation of why some servers in the United States make a base wage of $2.13 an hour. This practice is rooted in the Fair Labor Standards Act (FLSA) and the concept of a tipped minimum wage, which allows employers to pay a reduced hourly wage to employees who customarily receive tips.

The FLSA, enacted in 1938, is a federal law that establishes minimum wage, overtime pay eligibility, recordkeeping, and youth employment standards affecting employees in the private sector and in federal, state, and local governments covered by the act. One of the key provisions of the FLSA is the minimum wage, which is currently set at $7.25 per hour for most workers.

However, there is an exception to the minimum wage rule for tipped employees. A tipped employee is defined as an individual who customarily and regularly receives more than $30 a month in tips. For such employees, employers are allowed to pay a lower direct wage, known as the tipped minimum wage, which is currently $2.13 per hour at the federal level.

The rationale behind this lower wage is that the tips received by the employee are expected to make up the difference between the tipped minimum wage and the standard minimum wage. In other words, the combination of the tipped minimum wage and the tips should equal at least the federal minimum wage. This system is designed to acknowledge the additional income that tipped employees earn from customer gratuities.

It's important to note that this practice is subject to certain conditions and regulations. Employers are required to ensure that the tipped employee does indeed receive tips that, when combined with the tipped minimum wage, reach the federal minimum wage. If the tips plus the tipped minimum wage do not equal the standard minimum wage, the employer is obligated to make up the difference.

Additionally, there are restrictions on the types of duties that tipped employees can perform. Not all tasks can be considered "tipped" work. The FLSA specifies that only work that directly supports the service for which tips are received can be counted as tipped work. For example, a server who spends time setting tables or performing other preparatory tasks before the start of a shift may not have those hours counted as tipped work.

Critics of the tipped minimum wage argue that it places an unfair burden on workers, as it can be unpredictable and unreliable. They contend that it can lead to income instability and financial stress for employees who may not always receive enough in tips to make up the difference. On the other hand, proponents argue that the tipped minimum wage system allows for greater flexibility and can result in higher overall earnings for tipped employees.

The tipped minimum wage is a complex issue with various perspectives and implications. It's a topic that continues to be debated and discussed in the context of labor rights, economic policy, and social justice.

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A tipped employee engages in an occupation in which he or she customarily and regularly receives more than $30 per month in tips. An employer of a tipped employee is only required to pay $2.13 per hour in direct wages if that amount combined with the tips received at least equals the federal minimum wage.read more >>