HI SB432

Establishes a tip credit formula allowing tipped employees to be paid 25% below the minimum wage instead of the current flat 25-cent tip credit.

Requires that combined wages from employer plus tips must total at least 50 cents more than the applicable minimum wage.

Makes the tip credit flexible and self-adjusting with future minimum wage increases, eliminating the need for legislative amendments each time the minimum wage changes.

Directs savings from the increased tip credit toward discretionary pay increases for non-tipped employees and capital investments to stimulate the economy.

Takes effect upon approval.