Illinois tip pooling laws & tipped minimum wage
In Illinois, employers can pay tipped workers $9.00/hr as long as tips bring them to the $15.00 minimum — here's how that works and who can legally share your tips.
| Regular minimum wage | $15.00/hr |
| Minimum cash wage for tipped workers | $9.00/hr |
| Maximum tip credit | $6.00/hr |
| Tips belong to | Employees — always |
A tip credit lets an employer count your tips toward the minimum wage it owes you. Rates reviewed July 2026. Rates change — confirm with the Illinois labor department. Not legal advice.
What's specific to Illinois
Tipped workers must receive at least 60% of the minimum wage in cash. Chicago sets a higher local minimum and had been phasing out its tip credit, but the City Council paused that phase-out on May 20, 2026: the Chicago tip credit is frozen at 24% of the city minimum wage through June 30, 2028, and full elimination now lands in 2030 for employers with more than 21 employees and 2033 for those with 3 to 21.
Illinois guarantees tipped workers at least 60% of the minimum wage in cash
Illinois’ minimum wage is $15.00 an hour. Under the Illinois Minimum Wage Law, a tipped worker’s cash wage must be at least 60% of the minimum — so $9.00 an hour — and the employer’s tip credit is capped at the remaining 40%. Your tips must bring you the rest of the way to at least $15.00.
If your $9.00 cash wage plus your tips do not average at least $15.00 an hour over the pay period, your employer must make up the difference. Illinois also requires that you keep all the tips you earn, apart from a valid tip pool among customarily tipped staff.
Chicago and Cook County set higher rates, and Chicago has paused its tip-credit phase-out
If you work in the city of Chicago, your rates are higher than the state’s. As of July 1, 2026, Chicago’s minimum wage is $17.05 an hour and its tipped minimum wage is $12.96. Chicago’s One Fair Wage ordinance had been phasing the tip credit out in annual steps, but on May 20, 2026 the City Council voted 49–1 to pause it for two years. The tip credit is frozen at 24% of the city minimum wage through June 30, 2028, the step to 84% of the minimum moves to July 1, 2028, and full elimination now falls in 2030 for employers with more than 21 employees and 2033 for those with 3 to 21. The July 1, 2026 cost-of-living increase went ahead — only the tip-credit step was delayed.
Suburban Cook County is different again. As of July 1, 2026, the county minimum wage is $15.40 an hour and the tipped minimum wage is $9.25 — but many municipalities have opted out of the county ordinance, so whether it applies depends on your exact work location.
How to recover unpaid or withheld tips in Illinois
For unpaid wages or an improper tip credit, you can file a claim with the Illinois Department of Labor. If you work in Chicago, you can also contact the Chicago Office of Labor Standards; in unincorporated or participating parts of the county, the Cook County Commission on Human Rights enforces the county ordinance.
One rule never bends: managers, supervisors, and owners may not keep any part of your tips.
Tip pooling in Illinois
Illinois follows the federal baseline: employers may require tip pooling. If your employer takes the tip credit (pays $9.00/hr cash), the pool may only include customarily tipped workers — servers, bussers, bartenders, runners, hosts. Back-of-house can only be included if everyone is paid full minimum wage with no tip credit. Managers and supervisors are always excluded.
One federal rule applies everywhere: managers and supervisors can never take from a tip pool. Separately, credit card processing fees may only be deducted from tips where state law allows it.
What this means for your tip-out
Because part of your legal wage in Illinois comes from tips, the employer's tip credit assumes those tips reached you. Use the tip-out calculator to split a shift by your house's percentages or by hours, and see standard tip-out percentages to check whether your house's rates are typical.
Illinois tip law FAQs
What is the tipped minimum wage in Illinois?
Employers in Illinois may pay tipped employees a cash wage of $9.00/hr and claim a tip credit of up to $6.00/hr toward the $15.00 minimum wage. If tips don't close the gap in a workweek, the employer must make up the difference.
Is mandatory tip pooling legal in Illinois?
Illinois follows the federal baseline: employers may require tip pooling. If your employer takes the tip credit (pays $9.00/hr cash), the pool may only include customarily tipped workers — servers, bussers, bartenders, runners, hosts. Back-of-house can only be included if everyone is paid full minimum wage with no tip credit. Managers and supervisors are always excluded.
Can my manager take a share of the tip pool in Illinois?
No. Federal law prohibits managers, supervisors, and owners from keeping any portion of employee tips in every state, including Illinois. A manager may keep only tips they directly and solely earned (e.g., a table they personally served start to finish).
Is Chicago really getting rid of the tipped minimum wage?
Eventually, but not on the original schedule. Chicago’s One Fair Wage ordinance phases the tip credit out in steps, and on May 20, 2026 the City Council paused those steps for two years. The tip credit stays at 24% of the city minimum wage through June 30, 2028, and the credit is now due to reach zero in 2030 for employers with more than 21 employees and in 2033 for those with 3 to 21. The schedule has been changed more than once, so check the current Chicago Office of Labor Standards rate for your date.
Which minimum wage applies to me in Illinois?
It depends on where you work. The state rate of $15.00 (tipped $9.00) is the floor. If you work in the city of Chicago or in a part of Cook County that follows the county ordinance, the higher local rate applies instead.