Some states have a tipped minimum wage equal to the minimum wage. That includes Washington, the state with the highest tipped wage in the nation at $16.66. On the other end, the federal government mandates states pay at least $2.13 per hour to tipped employees. So there are 16 states tied for the lowest tipped wage at $2.13.

The tip credit, or subminimum wage, was expected to increase to 48% of the minimum wage on Feb. 21, 2025, continue to increase, and then be phased out completely by Feb. 21, 2029. The laws Whitmer signed made it so the subminimum wage remained at 38% and will instead increase by 2% each year through Jan. 1, 2031, when it will reach 50%.

Michigan tipped workers just saw the single-largest raise to their wages in state history. But it could have been higher.

More than six years ago, committees gathered enough petition signatures to put minimum wage and sick leave proposals on the ballot in November 2018. However, Republican lawmakers adopted the measures before Election Day, keeping them off the ballot, and then returned after Election Day to significantly weaken the requirements.

Bills based on voter initiatives would have phased out use of a sub-minimum wage for tipped workers. A last-minute compromise kept the tip

In the final hours before Michigan's minimum wage was set to increase, lawmakers passed two bills that aimed to increase wages at a slightly slower rate.

Changes have been made to Michigan’s minimum wage, tipped wage, and sick time laws. Two bills to amend Michigan’s minimum wage, tipped wage, and sick time laws were signed into law by Michigan Gov. Gretchen Whitmer on Friday, Feb. 21, 2025. The bills go into effect immediately and are retroactive.

Democratic Gov. Gretchen Whitmer has signed a compromise that scales back paid sick leave and wages for tipped workers in an effort to appease businesses following a minimum wage hike.

Democrats and Republicans passed a last-minute compromise before a state Supreme Court deadline. The vote suggests GOP shift toward workers.