South Dakota Server Minimum Wage

If you work as a server in South Dakota or would like to get into the industry, then you should be aware of what the minimum wage is for servers in South Dakota to ensure you are being paid the correct amount, or whether this is a job you would like to do.

The South Dakota server minimum wage rate in 2023 is $5.40 per hour.

The laws surrounding the South Dakota minimum wage for servers act as a safety net for those that may not earn enough in tips to meet the minimum wage threshold in the state.

Servers are the lifeblood of the hospitality industry and they serve their customers with food and beverages in a restaurant or similar type of business where food and drinks are delivered to the table. As part of providing this service, a server will typically receive tips (gratuities) for doing so.

South Dakota servers tend to rely far less on their low hourly tipped minimum wage and more on the generosity of the guests they serve for their paycheck each week.

What is the Server Minimum Wage in South Dakota for 2023

The minimum cash wage for servers in South Dakota is $5.40 per hour which is the same as the tipped minimum wage in South Dakota. This is the minimum per hour that a South Dakota server must be paid and that a South Dakota employer must pay its servers.

As you can see from the following graphic, the minimum wage for servers in South Dakota has been increasing slightly each year since 2018 when it was $4.32 per hour.

Minimum Cash Wage and Tip Credits

$5.40 per hour is not much to be paid an hour, but if a server’s tips are not sufficient enough South Dakota law requires that servers must be supplemented by their employers via “tipped credit”, which is, in South Dakota’s case, $5.40 per hour, making the server minimum wage in South Dakota, including tip credits, a total of $10.80 per hour.

The regular minimum wage in South Dakota for all types of employees does not follow the federal minimum wage guidelines that have been in their current form since 2008.

Instead, South Dakota has its own unique minimum wage rate that is calculated via the consumer price index and general inflation within the state.

Based on the tipped minimum wage laws that apply to all states, South Dakota employers are required to pay their employees an hourly minimum cash wage with the addition of tip credits.

What tipped credits allow employers to do is pay tipped employees less than the minimum wage so long as they can make up at least the difference via tips per hour during each working week.

Tip credit not only allows server employees to be paid less than the minimum hourly wage, but it is also the same concept with bartenders, hotel workers, airport attendants, other workers in the hospitality industry, and most other roles where tips are the primary income for the employee.

In South Dakota, servers must be paid a base minimum cash wage of $5.40 per hour. The expectation is that South Dakota servers will make at least an additional $5.40 per hour in tips on average across a working week, and if they do, then the employer is only obligated to pay a South Dakota server $5.40 per hour in 2023.

Let’s assume that a server in South Dakota does not make at least $5.40 per hour in tips as an average over the course of a working week, then the employer must step in and pay the South Dakota server a tip credit of up to $5.40 per hour, so the server makes a minimum of $10.80 per hour for the duration of the working week.

Fair Labor Standards Act (FLSA) and Tipped Employees

The Federal Fair Labor Standards Act, also known as the FLSA, is a federal law from the U.S. Department of Labor.

This law establishes a national minimum wage, defines classifications for employees, and covers other essential standards and requirements for employers.

Federal law requires that employers make tipped employees aware of the cash wage paid (currently, the national direct hourly salary is $2.13 per hour), let them know about the tip credit, and explain any tip pooling systems at the workplace.

Because South Dakota’s minimum wage rate is higher than the federal minimum wage rate, the state laws supersede the federal regulations.

South Dakota Server Minimum Wage History

The table below showcases the current rate and history of the South Dakota server minimum wage over the past 15+ years since 2008.

You can see when there were increases in the server minimum wage, which includes not only the tipped minimum wage rates but the tipped credit rates too.

Average Server Salary in South Dakota (2023)

Most South Dakota servers do not take a position at a restaurant, hotel, or cafe assuming they can only earn $10.80 per hour, because based on working 35-40 hours a week, they could only earn about $378-$432 per week before taxes.

What Do Servers Get Paid in South Dakota

The average server hourly wage in South Dakota according to the job website Indeed is $16.00 per hour! So, if you were to work an 8-hour shift or a total of 8 hours in a day across a couple of shifts, you could earn (on average) about $128 (8 hrs x $16.00).

If you worked five days per week, you could earn about $640 per week as a server in South Dakota!

If you took just two weeks off a year and worked for 50 weeks you could potentially earn $32,000 before taxes. If you decided to take 3 weeks off per year then you could potentially earn 49 x $640 = $31,360 for the year.

This, of course, is before South Dakota income tax has been deducted and any federal taxes that you may incur on your income.

The above calculations are just averages to give you an idea of roughly what you could earn as a South Dakota server.

The most important aspects of how much you can earn will depend on how good you are at your job, your experience level, what type of food/beverage establishment you work at, and how busy the restaurant/cafe/hotel or bar is.

Also, many people that work at restaurants or similar establishments are willing to work more than 40 hours per week which may make them qualify for overtime pay.

You also need to be working at an establishment that has enough business to keep you busy for 40 cumulative hours of shifts each week to potentially earn a good living.

Final Thoughts for Servers in South Dakota

If you are a South Dakota employer, it is your responsibility to pay your servers a minimum hourly rate + tip credit that at least equals the South Dakota minimum wage in the event that your servers do not earn enough to meet the $10.80 per hour threshold.

By failing to do so you could be breaking federal and state laws.

Equally, it is important that as a server working in South Dakota, you know your rights and how much you should be paid each week based on your hourly wage and tip credits.

If you have specific questions about the laws surrounding the minimum wage for servers in South Dakota (tipped employees) from both an employer and employee perspective, you can contact the South Dakota Department of Labor and Regulation.

Additionally, if you are an employee who isn’t being paid what you legally should be, you can file a complaint with them too.

The South Dakota Department of Labor and Regulation is located at 123 W. Missouri Ave. – Pierre, SD 57501, and their phone number is (605) 773 3101.