As we approach the start of a new year, New York employers should prepare for several wage-related adjustments effective January 1, 2025. Alongside an increase in the state’s hourly minimum wage rates, there are changes to the tip credit, meal credit, uniform allowance, and salary exemption thresholds. Employers should plan ahead and collaborate with their payroll teams to ensure compliance. Failing to implement these changes—including updating Notice of Pay Rate forms—poses a significant risk of legal liability.
Adjustments to Tip Credit for Food Service Workers
The minimum wage and minimum cash wage rates for tipped food service workers are set to increase. Food service workers include servers, bartenders, bussers, and runners who regularly receive tips. Below are the new rates:
New York City, Long Island & Westchester County
| Category | Current Rate | New Rate (Effective Jan. 1, 2025) |
|---|---|---|
| Minimum Wage | $16.00 | $16.50 |
| Minimum Overtime Rate | $24.00 | $24.75 |
| Cash Wage for Tipped Workers | $10.65 | $11.00 |
| Overtime Wage for Tipped Workers | $18.65 | $19.25 |
| Tip Credit | $5.35 | $5.50 |
Rest of New York State
| Category | Current Rate | New Rate (Effective Jan. 1, 2025) |
| Minimum Wage | $15.00 | $15.50 |
| Minimum Overtime Rate | $22.50 | $23.25 |
| Cash Wage for Tipped Workers | $10.00 | $10.35 |
| Overtime Wage for Tipped Workers | $17.50 | $18.10 |
| Tip Credit | $5.00 | $5.15 |
Adjustments to Tip Credit for Service Employees
For service employees—such as coat-check attendants—tip credit rates are also increasing. Employers must ensure these employees meet the “tip threshold” for weekly tips.
New York City, Long Island & Westchester County
| Category | Current Rate | New Rate (Effective Jan. 1, 2025) |
| Cash Wage for Service Employees | $13.35 | $13.75 |
| Tip Credit | $2.65 | $2.75 |
| Tip Threshold | $3.45 | $3.55 |
Rest of New York State
| Category | Current Rate | New Rate (Effective Jan. 1, 2025) |
| Cash Wage for Service Employees | $12.50 | $12.90 |
| Tip Credit | $2.50 | $2.60 |
| Tip Threshold | $3.20 | $3.30 |
Meal Credit Updates
Employers who provide meals to employees may take a meal credit, provided the meals meet specific nutritional standards. The updated meal credit rates are as follows:
| Employee Type | Current Credit | New Credit (Effective Jan. 1, 2025) |
| Food Service Employees | $3.85 | $3.95 |
| Service Employees | $4.45 | $4.60 |
| Non-Service Employees | $5.50 | $5.65 |
Uniform Allowance Changes
Employers requiring employees to wear uniforms must either maintain the uniforms or provide a uniform maintenance allowance. Rates are updated as follows:
New York City, Long Island & Westchester County
| Work Hours Per Week | Current Rate | New Rate (Effective Jan. 1, 2025) |
| More than 30 Hours | $19.90 | $20.50 |
| 20-30 Hours | $15.75 | $16.25 |
| 20 Hours or Less | $9.50 | $9.80 |
Rest of New York State
| Work Hours Per Week | Current Rate | New Rate (Effective Jan. 1, 2025) |
| More than 30 Hours | $18.65 | $19.25 |
| 20-30 Hours | $14.80 | $15.30 |
| 20 Hours or Less | $8.95 | $9.25 |
Salary Exemption Threshold Increases
For executive, managerial, and administrative employees exempt from overtime, the salary threshold will increase as follows:
| Region | Current Weekly Minimum | New Weekly Minimum (Effective Jan. 1, 2025) |
| NYC, Long Island, Westchester | $1,200.00 ($62,400/year) | $1,237.50 ($64,350/year) |
| Rest of New York State | $1,124.20 ($58,458.40/year) | $1,161.65 ($60,405.80/year) |
Action Items for Employers
- Review and adjust payroll systems to reflect the new rates.
- Issue updated Notice of Pay Rate forms to impacted employees.
- Verify compliance with tip credit, meal credit, and uniform maintenance requirements.
- Confirm exempt employee classifications meet both the salary threshold and job duties test.
By preparing for these updates now, employers can ensure a smooth transition and remain compliant with New York’s labor laws. For additional details, visit the Department of Labor’s Notice of Pay Rate page.
