Hawaii Tip Credit Calculator

The HRS §387-2 tip credit rule: how it works

Hawaii's tip credit allows an employer to pay a tipped employee as little as$14.75/hr — the state minimum wage of $16.00/hr minus the maximum tip credit of $1.25/hr. But the credit only applies when both of these statutory conditions are satisfied for the pay period:

1. Condition (a): The employee customarily and regularly receives more than$20/month in tips. This is a pattern-of-employment test, not a single-period test — an employee who occasionally earns tips but not as a regular feature of their job does not qualify.
2. Condition (b): The employee's combined cash wages plus tips per hour must reach at least $23.00/hr. This is exactly $7.00/hr above the $16.00/hr state minimum.

If the combined total falls below $23.00/hr for a pay period — because tips were low, hours were long, or both — the tip credit is not allowed for that period. The employer must make up the shortfall to the full $16.00/hr minimum wage. The credit cannot be applied retroactively or averaged across pay periods.

Relationship to Hawaii's minimum wage

The tip credit can only reduce wages to the adjusted minimum of $14.75/hr — it cannot reduce wages further. The full state minimum wage of $16.00/hr is always the floor when the credit is disallowed. See theHawaii Minimum Wage Calculator for gross pay calculations at the full minimum, and the Hawaii Overtime Calculator for overtime on tipped-employee hours.

What this calculator does not determine

• Whether a specific job category qualifies as a "tipped employee" under HRS §387-2.
• Tip pool legality or distribution rules — consult the DLIR Wage Standards Division.
• Overtime pay — the tip credit applies to the regular rate; overtime calculations for tipped employees require separate analysis.
• Whether an HRS §387-1 exemption removes the employee from coverage entirely.
• Federal FLSA tip credit rules, which may differ from Hawaii's state rule.
• Whether recordkeeping requirements for tip credit claims are satisfied.

Sources and verification

All rate values on this page — maximum tip credit $1.25/hr, adjusted minimum $14.75/hr, combined threshold $23.00/hr, and minimum monthly tips $20 — are read from the site's verified rate registry. The registry values were sourced directly from theHawaii DLIR Tip Credit Notice (statutory schedule, HRS §387-2), which tabulates each period through 2028. No rates are hardcoded in the calculator script; values are passed to the calculator via data- attributes on the calculator root element, and automated tests verify on every build that no dollar figures are hardcoded.

Effective period: January 1, 2026 to December 31, 2027. The amountVerified: true flag in the registry indicates this data has been independently confirmed from the primary source. The next scheduled change (January 1, 2028) is also verified from the same statutory schedule.