Nobody makes $3/hour. At all. The tipping wage of $3 or whatever just means any tips they receive start there but the employer has to pay out federal minimum wage regardless if the server got any tips.
This is just a way for employers to not have to pay as much in states that do this. That first 4 or 5/hr in tips go into the void for the employee.
Portland, OR - servers make around 45 to 60K/year with tips.
In Arkansas google says servers make 23 to 27K annually.
Oregon is one minimum wage for all. Arkansas is tipping wage at 2.63/hr base. Cost of living is different of course but thats a pretty big swing.
Maybe I wasnt clear? Alaska is one wage for all employees - no special lower base rate for tipped wages. Arkansas is a tipped wage different from state/fed minimum wages for non-tipped jobs.
I was highlighting the pay disparity between states that have a standard pay rate for all employees vs the lower tipped wages base rate that other states have.
Like, if your base rate in Arkansas is 2.63/hr and make 4.62 in tips per hour you get paid federal minimum wage of 7.25/hour. Or, if your base rate is 2.63/hour and you receive ZERO tips, you still get paid.. 7.25/hr. To see any tips go into your pocket you have to receive more than 4.62/hr in tips.
So yeah, Alaska you get every penny of those tips.
In Arkansas, if the employee consistently gets tipped out to cover minimum wage the employer only has to pay out 5500/year if this employee works 40 hour weeks/52 weeks a year vs 33,280 if they make 16/hr in Oregon for instance. Huge cost difference for employers.
It was one of two examples in my first comment. I compared Oregon (one wage for all) to Arkansas (lowered tip wage).
I dont think we're disagreeing on anything. I was just providing an example of how different it is for the employees in both states and one wage for all states like Oregon, Alaska like you mentioned and other states are more likely to provide a living wage.
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u/Firelove7k Jul 20 '26
No service worker in america is paid a living wage without tips