Chapter 228
2015 -- H 5364 SUBSTITUTE A
Enacted 07/10/2015

A N   A C T
RELATING TO LABOR AND LABOR RELATIONS - MINIMUM WAGE - GRATUITIES

Introduced By: Representatives Regunberg, Bennett, O'Brien, McNamara, and Diaz
Date Introduced: February 11, 2015

It is enacted by the General Assembly as follows:
     SECTION 1. Section 28-12-5 of the General Laws in Chapter 28-12 entitled "Minimum
Wages" is hereby amended to read as follows:
     28-12-5. Employees receiving gratuities -- Incentive-based wages -- Certain
employees of nonprofit entities. -- Employees receiving gratuities. -- (a) Every employer shall
pay to each of his or her employees who, who are engaged in any work or employment in which
gratuities have customarily and usually constituted a part of his or her weekly income, the rate as
provided by §§ 28-12-3 and 28-12-3.1.
      (b) Allowance for gratuities as part of the hourly wage rate for restaurants, hotels, and
other industries industries, except taxicabs and limited public motor vehicles vehicles, shall be
an amount equal to the applicable minimum rates as provided by §§ 28-12-3 and 28-12-3.1 less
two dollars and eighty-nine cents ($2.89) per hour. "Gratuities" means voluntary monetary
compensation received directly or indirectly by the employee for services rendered.
      (c) Each employer desiring to deduct for gratuities as part of the minimum rates as
provided in §§ 28-12-3 and 28-12-3.1 wages paid to an employee shall provide substantial
evidence that the amount shall be set out in the formula in subsection (b) of this section; however,
the cash wage shall not be less than two dollars and eighty-nine cents ($2.89) per hour.; provided,
however, that commencing January 1, 2016, the cash wage shall increase by fifty cents ($.50) to
an amount not less than three dollars and thirty-nine cents ($3.39) per hour; provided further, that
commencing January 1, 2017, the cash wage shall increase by fifty cents ($.50) to an amount not
less than three dollars and eighty-nine cents ($3.89) per hour.
     (d) The director of labor and training shall notify employers concerning what type of
proof shall be accepted as substantial evidence for the purpose of this subsection. Employees
involved shall be entitled to a hearing on the question of the amount of deduction if they so
desire.
      (d)(e) In cases where wages are figured by the employer on an incentive basis in such a
manner that an employee of reasonable average ability earns at least the minimum wage
established by §§ 28-12-3 and 28-12-3.1, it shall be taken that the employer has complied with
this statute. It shall be of no concern to the director of labor and training how the employer arrives
at its wage scale so long as it is not unreasonable in its demands on the employee.
      (e)(f) Where, in the case of the employment of a full-time student who has not attained
his or her nineteenth (19th) birthday engaged in the activities of a nonprofit association or
corporation, whose aims and objectives are religious, educational, librarial, or community service
in nature, the employer-employee relationship does exist, the employer shall pay to each such
employee wages at a rate of not less than ninety percent (90%) of the minimum wage as specified
in § 28-12-3. In case of any conflict between provisions of this section and those of § 28-12-3.1,
the provisions of § 28-12-3.1 shall govern.
     SECTION 2. This act shall take effect upon passage.
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LC000752/SUB A/2
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