Maryland minimum wage and tipped wage for restaurants (2026)

Maryland owners pay one of the higher minimum wages on the East Coast, and the tip credit works differently here than in the South. On top of the state rule, some counties set their own higher rates, so a restaurant group with locations in more than one county may be paying more than one minimum. This guide explains the state figures, how the tip credit works, where county rates differ and how to avoid the common payroll mistakes. It is general information, not legal advice, and the Maryland Department of Labor is the place to confirm any number.

What is the Maryland minimum wage in 2026?

Maryland's general minimum wage is $15.00 an hour for covered employees. Check the Maryland Department of Labor for any change to the state rate, and remember that a rise in a county rate can still catch you out.

What is the tipped cash wage?

For tipped employees, the direct cash wage is $3.63 an hour. The employer can claim a tip credit of up to $11.37 an hour, as long as the worker's cash wage plus tips equals at least the full $15.00 for every hour worked. If tips in a week fall short, you must make up the difference. A tipped employee is generally one who customarily and regularly receives more than $30 a month in tips. As elsewhere, the credit is optional, and many Maryland restaurants pay more than the minimum cash wage to keep staff.

Do counties set higher rates?

Some do, and this is where owners get tripped up. A few counties set a minimum above the state rate, and some set their own tipped cash wage or tier the rate by the size of the employer. Other counties and Baltimore City follow the state rate unless they set their own. County rates can change during the year, so check the Department of Labor's current table each time you open a location, hire in a new county or review pay.

How does overtime work for tipped staff?

Overtime for a tipped employee is calculated on the full minimum wage, not the cash wage, and the tip credit is deducted afterward. Many payroll defaults get this wrong. Ask your payroll provider to show you the formula on a real pay stub for a 45-hour week and confirm it before you rely on it.

What notice and records do you need?

Tell each tipped employee in writing that you are taking the tip credit, what the cash wage is and that tips must bring pay up to the full minimum. Keep time records and tip records for each pay period. Maryland has its own recordkeeping rules, so check how long to keep them. Having documents ready in an hour is much better than a week. If you have locations in two counties, keep a separate folder for each, with the county minimum and the date you checked it. Payroll mistakes tend to repeat on every pay run until someone catches them, so a quarterly review of three sample pay stubs per location is worth the hour it takes.

What about tip pooling and service charges?

Tip pooling is allowed among employees who customarily receive tips, and managers cannot take part of the tips. A mandatory service charge is not a tip, and how it is treated for wages and tax depends on how it is described and distributed. Describe any charge clearly on the menu and the check, and ask your payroll provider and tax adviser before adding one.

How should you plan around the numbers?

Because county rates can move on their own schedule, your planning risk is county action and your own wage ladder. Three habits help.

• Keep a simple payroll sheet that shows each location's county minimum and the date you last checked it.
• Pay above the minimum for experienced servers and cooks, so that a county increase does not squeeze your pay ladder.
• Review your menu prices twice a year against the real labor cost of each shift.

What about young workers?

Sources disagree about the rate for workers under 18, so check the Department of Labor's guidance before relying on a youth rate. Maryland also limits the hours and tasks of minors, and requires work permits in some cases. Keep a copy of the permit and the schedule in the file. Training a young worker well pays off, since many of them stay in the industry or come back to it, and they often become reliable weekend help during busy seasons.

Are you paying for tables that are not filled?

Higher wages put the weight on the other side of the sum: how many guests are in your dining room on the shifts you are already paying for. Mosey is a food-first app where diners search by dish and mood, rate what they ate and keep lists of places they want to try, and where independent restaurants and cafes get tools for their own page, menu and regular guests. For a business that needs more of its paid hours to be busy hours, being found by the dish is what Mosey is built around.

More guides for your business:

• Maryland food service license and certified food manager rules
• Maryland sales tax on restaurant meals and alcohol: what to charge

More in the US guides for food businesses.