What is the tipped minimum wage in Michigan in 2026?

Under 2025 Public Act 1 (amending MCL 408.934d), the minimum direct cash wage for tipped employees in Michigan is $5.49 per hour (40% of the $13.73 minimum wage) for calendar year 2026. The maximum tip credit is $8.24 per hour ($13.73 - $5.49).

What happens if a Michigan server’s tips do not equal the maximum tip credit?

The employer is strictly required to make up the difference. If direct cash wages plus tips received average less than $13.73 per hour across all hours worked in the workweek, the employer must pay additional cash wages to ensure total compensation reaches $13.73/hr.

How is overtime calculated for tipped employees in Michigan?

In Michigan, statutory tipped overtime requires calculating time and one-half the full minimum wage minus the lawful tip credit: (1.5 × $13.73) - $8.24 = $20.595 - $8.24 = $12.355 per hour as the direct cash overtime wage floor.

Michigan Tipped Wage Law • MCL 408.934d • 2025 PA 1

Michigan Tipped Minimum Wage & Tip Credit Calculator

Audit Michigan tipped employee compensation for calendar year 2026. Calculate the mandatory direct cash wage floor of $5.49 per hour, enforce the maximum tip credit of $8.24 per hour, reconcile tip shortfalls against the full $13.73 wage standard, and compute statutory tipped overtime at $12.355 per hour.

Michigan Tipped Minimum Wage & Tip Credit Calculator

Compute direct cash-wage floors ($5.49/hr in 2026), allowable tip credits ($8.24/hr), tipped overtime cash requirements ($12.355/hr), and mandatory shortfall make-up pay under MCL 408.934d.

Total Workweek Hours *

Overtime Hours (Optional; auto-derived if omitted)

Workweek Date

Tip Credit Notice Status *

Under federal FLSA and Michigan law, employers must inform workers of tip credit provisions before taking the credit.

Tipped Occupation Status *

Tip Pool Legality / Participation *

Employer Cash Wages Paid ($)

Hourly Direct Cash Rate ($/hr)

Tips Received & Retained ($)

Understanding Michigan Tipped Wage Rules

Direct Cash Wage Floor & Schedule

Under 2025 PA 1, Michigan maintained a modified tip credit schedule: 38% direct cash from February 21, 2025 ($4.74/hr, max credit $7.74); 40% in calendar 2026 ($5.49/hr direct cash, max credit $8.24); and 42% in calendar 2027 ($6.30/hr direct cash, max credit $8.70 on a $15.00 minimum wage).

Employer Make-Up Obligation

An employer may take a tip credit only if the employee actually receives sufficient tips to equal or exceed the maximum tip credit ($8.24/hr in 2026). If tips fall short, the employer must pay additional cash wages. In overtime hours, the tip credit remains capped at $8.24, producing a direct cash overtime rate of $12.355/hr.

Need comprehensive statutory citations, tip pool rules, and worked examples?Read the Complete Michigan Tipped Wage Guide →