One Missing Signature Voids Every Tip Credit You Ever Took
TipGuard generates state-specific tip-credit notices, collects signed acknowledgments, and keeps the dated file a DOL investigator asks for first.
- 7 questions
- 2 minutes
- No card
Back-pay liability accrues on every shift you run without the signed file.
Marisol Vega
Server · Austin, TX
- Cash wage
- $2.13 / hr
- Tip credit claimed
- $5.12 / hr
- Rule version
- TX v2026.2
Employee acknowledgment
Signature of employee
Review by your counsel before distribution. TipGuard generates this notice from a per-state rule library; it is not legal advice.
The arithmetic of a disallowed credit
Federal floor · states may be stricter
- The cash wage a tipped employee may be paid per hour — but only while the tip credit is validly claimed.
- $2.13The cash wage a tipped employee may be paid per hour — but only while the tip credit is validly claimed.29 U.S.C. §203(m)
- Elements every tipped employee must be informed of before a single hour is paid at the tip-credit rate.
- 5Elements every tipped employee must be informed of before a single hour is paid at the tip-credit rate.29 CFR §531.59(b)
- Back wages owed, plus an equal additional amount as liquidated damages, when the credit is disallowed.
- 2×Back wages owed, plus an equal additional amount as liquidated damages, when the credit is disallowed.29 U.S.C. §216(b)
- Lookback window on a willful violation — every tipped hour inside it is recomputed at full minimum wage.
- 3 yrLookback window on a willful violation — every tipped hour inside it is recomputed at full minimum wage.29 U.S.C. §255(a)
The gap nobody audits until it is audited
The credit is conditional. The paperwork is the condition.
An hour paid at $2.13 is only valid while the signed notice, the tip-pool composition and the overtime basis all hold. Break one and the credit is recomputed backward — not from today.
- 01
The tip credit is conditional — no signed notice means the $2.13 rate was never valid, retroactively, for every tipped hour
- 02
Food service is the most-audited industry and the missing per-employee notice is the most-cited paperwork failure
- 03
You will not find out the file is incomplete until an investigator is already asking for it
What changes
Know your exposure in two minutes, then close the gaps the same afternoon.
Roster in, audit file out
Three moving parts. None of them are your evening.
Your roster in. State-correct notices out.
Upload the staff CSV your payroll already exports. TipGuard resolves your state's cash wage floor, maximum tip credit and required notice elements, then drafts a per-employee notice stamped with the rule version it was written against — and emails it for signature.
- Per-state rule library, not a generic template
- States that eliminated the credit get a no-tip-credit notice instead
- Signed acknowledgment stores signer, UTC timestamp, IP and the exact text agreed to
Four ways the credit breaks. All four, watched.
Every scan runs the same four rule classes an investigator runs: overtime premiums computed off the sub-minimum cash wage, ineligible managers or back-of-house in the tip pool, workweeks where wage plus tips fell under the minimum, and notices that are missing or stale.
- Each finding names the employees and pay periods affected
- Ranked by estimated exposure, in plain English, with the fix
One dated export. Assembled on demand.
Signed notices with their signature metadata, the notice-status roster, the violation log with resolutions, and the state rule versions applied — indexed into a single file the day someone asks for it, not the week after.
- Frozen copy of every notice as it was acknowledged
- Cover index: employee, status, rule version
Start with the free score — seven questions, no account. The gap list it produces is the same checklist the product then closes.
Get My Free Audit-Readiness ScoreWhat the vault stores · record format
Price the paperwork, or price the claim.
If the credit is disallowed
- Tipped staff
- 20
- Tipped hours each
- 30 / wk
- Credit at risk
- $5.12 / hr
- Lookback
- 104 wks
Back wages recomputed
$319,488
Plus liquidated damages · 29 U.S.C. §216(b)
$638,976
The claim, against the line item
That is 674× one year of TipGuard.
Illustrative federal-floor arithmetic ($7.25 minimum less the $2.13 cash wage), before attorney fees or state penalties. Your state may be stricter.
TipGuard Shield
Score stays free$79/ month
Every employee, every state, every rule update — and the export. One line item on the books, sitting next to the POS subscription.
What the audit file contains
- Every signed acknowledgment, with signer name, UTC timestamp, IP and user agent
- A frozen copy of the exact notice text each employee agreed to
- The notice-status roster: who is signed, sent, draft or expired
- The violation log, including findings you already resolved
- The state rule version applied to every notice in the file
Score your restaurant against the same items an investigator opens with — notices, tip-pool composition, overtime basis, and sub-minimum shortfalls.