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Shift earnings guide

How to calculate hourly earnings with tips

Turn wages, cash tips, card tips and shared tips into one consistent number for comparing your own shifts.

Use total shift earnings, not only cash in hand

Effective hourly earnings= (wages + cash tips + card tips + tip-in − tip-out) ÷ worked hours

The result answers a narrow question: how much did this recorded shift earn per worked hour? It is useful for comparing your own shifts. It is not a legal wage calculation, employer payroll record, tax result or promise about future income.

Keep the inputs consistent

  • Worked hours: use actual worked time after unpaid breaks when known.
  • Wages: use the amount earned for those hours, not the later paycheck deposit.
  • Cash and card tips: include both, even when card tips arrive later.
  • Tip-in and tip-out: add money received from the team and subtract money shared out.

If hours or wages are unknown, leave them unknown and complete the record later. Inventing a zero wage or guessed duration can make the rate look more precise while making it less useful.

Worked example: one six-hour shift

Illustrative shift earnings
PartAmount
Wages$48
Cash tips$62
Card tips$90
Tip-out−$10
Total earned$190

$190 divided by six worked hours equals $31.67 per hour. The example is before tax and withholding.

Do not confuse earned with received

The shift can earn $190 even if only $52 is in your hands at closing. In the example, $62 cash minus the $10 tip-out is received during the shift, while $48 in wages and $90 in card tips remain expected through payroll. Payment timing changes what you have, not what that shift earned.

Compare patterns, not one lucky night

Use the same definition of worked time and the same categories across every shift. Compare weekly or monthly weighted totals rather than averaging several per-shift rates, because a two-hour shift should not influence the result as much as an eight-hour shift.

Next: reconcile delayed card tips on payday →