TX Minimum Wage Stays $7.25 — But Your Tip Credit Math Still Trips Audits

Panko Alerts · May 12, 2026

While Texas minimum wage isn't changing this May, DOL auditors are hammering restaurants on tip credit calculations during their spring sweep. If any tipped employee doesn't clear $7.25/hour after tips in a pay period, you owe the difference — and most operators mess up the weekly averaging or forget about side work time at full minimum. Pull your last three weeks of tip reports and run the math employee by employee, especially your newer servers and anyone doing significant prep work. Texas Workforce Commission sees this violation in 60% of restaurant audits, and the back-pay liability adds up fast.

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Source: Panko Alerts