⚠️ Correcting widespread misinformation
Seattle Tip Credit: Eliminated
As of January 1, 2025, Seattle has no tip credit. All tipped employees must be paid the full $21.30/hr minimum wage before tips.
⚠️ Warning: Online Misinformation
Several major websites (including minimum-wage.org and others) still display a $2.19/hr tip credit for Seattle as of April 2026. This is incorrect. Seattle fully eliminated its tip credit schedule, which had been phasing down over several years, effective January 1, 2025.
If you are a restaurant owner relying on outdated online information, you may be underpaying employees — which violates Seattle labor law and can result in significant penalties.
What This Means for Seattle Restaurants
Full Minimum Wage Required
Every tipped employee (servers, bartenders, bussers) must be paid at least $21.30/hr. Tips are on top of this, not counted toward it.
True Cost Per Server
At $21.30/hr for 40 hrs/week, one full-time server costs approximately $44,304/year in base wages alone — before sick leave, PFML, workers' comp, and other mandated costs.
Penalties for Non-Compliance
The Seattle Office of Labor Standards enforces minimum wage violations. Penalties include back pay, interest, fines up to $500/violation, and potential civil action.
Seattle vs. Other Cities: Tipped Employee Wages
| City | Min Wage | Tip Credit | Tipped Wage |
|---|
| Seattle | $21.30 | NONE | $21.30 |
| San Francisco | $18.67 | None | $18.67 |
| New York City | $16.50 | $5.00 | $11.50 |
| Chicago | $15.80 | $6.60 | $9.20 |
| Federal minimum | $7.25 | $5.12 | $2.13 |
Seattle tipped employees earn the highest guaranteed base wage in the US.
Timeline: How Seattle's Tip Credit Was Phased Out
Seattle's minimum wage ordinance (passed in 2014) included a schedule that gradually reduced and eventually eliminated the tip credit for large employers. The phase-out was completed on January 1, 2025, when the tip credit dropped to $0.00 for all employer sizes.
This means Seattle now joins San Francisco, Minneapolis, and several other cities that require full minimum wage for all employees regardless of tips received.
What Should Restaurant Owners Do?
- Verify your payroll: Ensure all tipped employees are at $21.30/hr or above
- Update your pricing: Many Seattle restaurants have moved to service charges or higher menu prices to offset labor costs
- Use our minimum wage calculator to see true labor costs including all mandated benefits
- Don't rely on outdated websites: Always check Seattle OLS for current rates
Source: Seattle Office of Labor Standards. This page is for informational purposes only and is not legal advice.