The headline numbers
Reached $15.00 January 2024 per Fight for Fifteen Act. Montgomery County and others have higher local minimums.
Maryland allows employers to take a tip credit of $11.37/hour against the full state minimum wage. That means the employer can pay you as little as $3.63/hour in direct wage, as long as your tips bring total earnings to at least $15.00/hour for the pay period. If tips fall short, the employer must make up the difference.
Tip pool rules
Tip credit allowed but several counties have separate rules. Montgomery County phasing toward no tip credit by 2027.
Universal rules that apply in every state regardless of tip credit status:
- Managers and supervisors cannot keep any portion of tips, even in a valid tip pool. This is a federal rule under FLSA Section 203(m)(2)(B) and applies in Maryland.
- Workers must keep all tips minus valid tip pool / tip-out contributions.
- If the employer uses a tip credit, only customarily tipped employees can be in the tip pool. To include BOH (cooks, dishwashers), the employer must pay full minimum wage to all participants.
Sidework and the 80/20 rule in Maryland
No state-specific 80/20 rule, but Montgomery County has additional protections.
The federal 80/20 rule was struck down by the 5th Circuit in Restaurant Law Center v. DOL (2024) and is no longer enforceable as a federal regulation. Whether sidework time over 20% triggers full-minimum-wage protection in Maryland depends entirely on state-level enforcement. If your state doesn't have its own active rule, all sidework hours within the tipped occupation may be paid at the tipped wage.
Local minimums that may apply
Several cities and counties in the U.S. set higher minimum wages than their state. Local minimums always supersede state minimums where applicable. Check whether your city has its own ordinance:
- Montgomery County (~$17.15 for large employers), Howard County, Prince George's
Notable state-specific items
- Counties impose income tax on top of state (additive 2-3%)
- Montgomery County moving to eliminate tip credit
How to verify the current numbers
Wages, indexed minimums, and tip credit rules change. Always cross-check before relying on specifics:
- State labor agency: https://www.dllr.state.md.us/
- State revenue agency (for tax info): https://www.marylandtaxes.gov/
- Federal DOL Wage and Hour Division: dol.gov/agencies/whd