Restaurant Labor Costs in Massachusetts
Massachusetts sets a minimum wage of $15.00 an hour, with a minimum cash wage of $6.75 for tipped employees and a tip credit of $8.25. The credit applies only where an employee’s tips bring them to at least the full state minimum across the pay period, and the employer covers any shortfall.
Figures verified July 2026
Statutory rates
| Rate | Per hour | Source |
|---|---|---|
| State minimum wage | $15.00/hr | U.S. Department of Labor, Wage and Hour DivisionRevised 1 January 2026 |
| Minimum cash wage (tipped employees) | $6.75/hr | U.S. Department of Labor, Wage and Hour DivisionRevised 1 January 2026 |
| Maximum tip credit1 | $8.25/hr | U.S. Department of Labor, Wage and Hour DivisionRevised 1 January 2026 |
1 Applies where tips bring the employee to at least the full state minimum.
Next scheduled change: 1 January 2027. Massachusetts rates are normally reviewed for 1 January.
On role-level pay data
Median pay by role for Massachusetts is published by the Bureau of Labor Statistics, linked below. Greater Boston runs well above the state median, so the metro estimates are the more useful cut if you're hiring there.
From an hourly rate to a labor cost percentage
The rates above are what you may not pay below. What an hour costs you is larger, once the on-costs below are added, and the labor cost percentage calculator will turn the two halves into a figure you can compare. The prime cost calculator then tells you whether that number and your food cost together leave room for rent and profit.
Tips and tip handling
Massachusetts permits a tip credit of $8.25, leaving a cash wage of $6.75 for tipped staff. The obligation to top up when tips fall short sits with you, and it’s assessed across the pay period rather than shift by shift, so a quiet Tuesday can be offset by a strong Saturday within the same period.
If you need to write this down for your team, the tip-out policy generator produces a plain-language policy document, and the tip-out calculator handles the nightly split.
What else drives your labor cost here
Top-up obligations are assessed by pay period
With a $6.75 cash wage and an $8.25 credit, you're responsible for making up any shortfall where tips don't reach the full minimum. It's measured across the pay period, so a quiet Tuesday can be offset by a strong Saturday inside the same window.
Premium pay rules change
Massachusetts has its own rules on premium pay for certain days and hours in hospitality settings, and they've been revised more than once. Confirm the current position with the state rather than assuming last year's answer still stands.
Payroll taxes and paid leave
Employer payroll taxes, unemployment insurance and the state's paid family and medical leave contributions all sit over the hourly rate and rise with it.
For what your percentage should be measured against, see the cost benchmarks by type of food business.
Run your own numbers
Frequently asked questions
What is the minimum wage in Massachusetts?
$15.00 an hour, with a minimum cash wage of $6.75 for tipped employees and a maximum tip credit of $8.25.
What happens if tips don’t reach the minimum wage?
The employer makes up the difference. The tip credit is only available where tips bring the employee to at least the full state minimum.
Labor costs elsewhere
- Restaurant Labor Costs in the United StatesFederal floor, the tip credit, BLS median pay by role, and the national benchmarks.
- Restaurant Labor Costs in New YorkTwo regional rates, and tipped wages that vary by region and employer type.
- Restaurant Labor Costs in IllinoisA percentage-based tip credit, and a Chicago ordinance that diverges from the state.
Rates on this page are reproduced from the government sources listed below and were last checked on 20 July 2026. They are published for orientation and are not legal advice — before you set pay, confirm the current figure against the primary source for your jurisdiction, including any local ordinance that may exceed it. The headline rate at time of writing was $15.00 per hour.
Sources
- U.S. Department of Labor, Wage and Hour Division — Minimum Wages for Tipped EmployeesRevised 1 January 2026 · Government / statistical