Why can’t McDonald’s employees accept tips in the United States?

In the United States, the federal minimum wage is $7.25 per hour. However, the minimum wage for tipped employees is $2.13 per hour. According to the Department of Labor, the amount of tips plus the $2.13 must add up to at least $7.25 per hour. Otherwise, the employer must pay to make up the difference.

In most cases, it is customary to tip waiters or service providers. However, there are certain restaurants or franchises, particularly fast food establishments like McDonald’s, where employees are not allowed to accept tips. The company enforces a policy that prohibits workers from receiving tips, regardless of whether they are offered voluntarily.

Why can't McDonald's employees accept tips in the United States?

McDonald’s workers are not tipped employees, so they must be paid at least minimum wage. This is, however, not the reason for the ban.

According to the company’s website, “tips are not accepted as McDonald’s restaurants have a team environment that is not about rewarding people.” If you are interested in making a donation, the company suggests using the donation boxes located at the Ronald McDonald House (RMHC).

The law that could lift the ban in Colorado

Workers at companies like McDonald’s may be able to accept cash tips under a proposed law before the Colorado legislature. If enacted, the legislation would prevent an employer from “taking adverse action against an employee who accepts a cash gratuity offered by a business sponsor,” according to a summary of the proposal. Earlier this month, the Colorado State House and Senate approved the bill, which now awaits Governor Jared Polis’s signature before it becomes effective.