In most states, employers can legally pay tipped workers less than minimum wage, and this tip credit subsidy is commonplace in the restaurant industry for food and beverage service jobs. However, recently, there has been an effort to ban subminimum wages. There are a few states with proposals on the upcoming ballot to remove the subminimum wage and increase their statewide minimum wage. The National Restaurant Association argues that people seek out tipped jobs intentionally and that instances of wage theft are overstated. However, proponents of abolishing subminimum wages state that workers are being underpaid due to this practice, and there are potential benefits for both employers and workers with lower turnover and better morale.
See "Empowered by post-pandemic labor shortages, tipped workers fight to ban subminimum wages", Talmon Joseph Smith , New York Times, October 13, 2022