News & Analysis as of

Fair Labor Standards Act (FLSA) Tip-Pooling

Fisher Phillips

Can Restaurant Hosts Share in the Tip Pool? Top 5 Questions for Employers that Take a Tip Credit

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Many restaurants utilize tip pools to encourage teamwork, consistency, and customer-focused service – but you may be confused about who can and can’t participate in the pool. You feel confident that your servers and...more

Parker Poe Adams & Bernstein LLP

Eleventh Circuit Confirms That Service Charges Are Not FLSA Tips

The tip wars between hospitality employers and employees continue unabated. Numerous lawsuits contend that restaurants and other employers wrongfully retain or require sharing of customer gratuities, as well as violate Fair...more

Parker Poe Adams & Bernstein LLP

Labor Department Continues to Pursue Restaurant Owners for Illegal Tip Pools

Under the Fair Labor Standards Act (FLSA), business owners and managers may not share in their servers’ tips. In recent weeks, the U.S. Department of Labor’s Wage and Hour Division announced recoveries against two restaurants...more

Fisher Phillips

Are You Properly Paying Your Bell Staff? 5 Top Questions for Hotels that Take a Tip Credit

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Hotel staff often include a mix of tipped and non-tipped jobs, but following wage and hour rules isn’t always easy, particularly if employees perform a variety of tasks. Some workers — such as servers and bartenders — may...more

Littler

Dear Littler: How Do Restaurants Without Table Service Handle Tips?

Littler on

Dear Littler, We operate sandwich shops in a couple of states. Although we have tables, we don’t have table service, and customers pick up food at the counter themselves to either take out or seat themselves at our...more

Epstein Becker & Green

Utah Expands Tip Pooling to Include Non-Tipped Employees

Epstein Becker & Green on

On March 23, 2023, Utah Governor Spencer Cox signed into law Senate Bill 73 (“SB 73”) expanding the group of employees eligible for tip pooling by allowing employers to include non-tipped employees in a bona fide tip pooling...more

Steptoe & Johnson PLLC

Pennsylvania Updated Minimum Wage Regulations Take Effect This Friday

By Friday, August 5, Pennsylvania employers must ensure their wage and hour practices comply with the updated Pennsylvania minimum wage regulations. The new regulations address compensation calculations for tipped employees...more

Jackson Lewis P.C.

Pennsylvania’s New Requirements for Tipped and Salaried Employees: Common Questions

Jackson Lewis P.C. on

The Pennsylvania Department of Labor and Industry has implemented new regulations under the Pennsylvania Minimum Wage Act (PMWA) that go into effect on August 5, 2022. The regulations make a number of important changes for...more

Mitchell, Williams, Selig, Gates & Woodyard,...

Tips, Tip Pooling, and Tip Credits: What is a Restaurant Legally Allowed to do with its Tips?

Employees in a restaurant setting often receive tips, and employers often take a “tip credit” toward the minimum wage that they have to pay (allowing the employer in Arkansas to pay $2.63/hour to the tipped employee if the...more

Jackson Lewis P.C.

Rhode Island Enacts Tip Law, Mirroring Aspects of the FLSA

Jackson Lewis P.C. on

Rhode Island has joined the list of states adopting laws governing the payment of tips. House Bill (HB) 7510, which is codified as Public Law 2022-245, mirrors nearly all tip-related aspects of the federal Fair Labor...more

Fisher Phillips

4 Reminders for Employers After a Texas BBQ Chain’s $900K Tip Pooling Mistake

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Employers in the restaurant and hospitality industries know it’s a common practice to ask workers to share gratuities. Tip pools can promote teamwork and a better customer experience – but they can also land you in hot water...more

Jackson Lewis P.C.

Pennsylvania Regulatory Commission Approves Expansive Tipped Employee Regulations

Jackson Lewis P.C. on

Bucking the standard that has existed under federal law and in most states for decades, tipped employees in Pennsylvania soon will have to earn more than four times as much in tips before their employers may take a tip credit...more

Fisher Phillips

Is Your Tip Credit A Ticking Time Bomb? An Employer’s 10-Step Wage and Hour Action Plan for 2022

Fisher Phillips on

With the government’s final rules on the tips provisions of federal wage and hour law becoming effective just weeks ago, employers will be challenged with ensuring they have a plan to address the rules’ impact on their...more

Akerman LLP - HR Defense

DOL’s Final Rule on Tipped Employees Takes Effect December 28th

Beginning December 28, 2021, employers must pay tipped employees the full minimum wage for periods when non tip-producing work is performed for a substantial amount of time, in light of a new Department of Labor (DOL) Final...more

Burr & Forman

Department of Labor Releases Final Rule for Tipped Employees

Burr & Forman on

Tip Credits under the Fair Labor Standards Act - The Fair Labor Standards Act (“FLSA”) generally permits employers to pay tipped employees less than the minimum hourly wage, provided that the tips the employee receives are...more

Jackson Walker

Impact of the Fifth Circuit’s Swales Decision on the FLSA Collective Action Certification Process

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Employers confronted with Fair Labor Standards Act (FLSA) claims as to their operations in Texas, Louisiana, or Mississippi should take note of a new decision by the United States District Court for the Northern District of...more

Fisher Phillips

Feds Now Have Broader Authority to Assess Monetary Penalties for Tip Violations

Fisher Phillips on

Federal labor officials just finalized a rule that broadens their ability to assess monetary fines against those business that commit wage and hour violations with regards to tip payments, a development several months in the...more

FordHarrison

Restaurant Industry Alert: DOL Issues Final Rule Modifying Tip Sharing

FordHarrison on

On September 23, 2021, the U.S. Department of Labor (DOL) issued its latest rule related to tip pooling. The rule modifies and clarifies aspects of a rule previously issued by the Trump administration. ...more

Littler

Final Rule Affirms U.S. Department of Labor’s Power to Fine Businesses That Engage in Tip Theft

Littler on

The U.S. Department of Labor published a final rule on September 23, 2021 clarifying several amendments to section 3(m) of the Fair Labor Standards Act (FLSA) that concern tip pooling. The final rule reestablishes the DOL’s...more

Jackson Lewis P.C.

Labor Department Issues Tip Regulations Final Rule On Tip Sharing, Civil Monetary Penalties

Jackson Lewis P.C. on

The U.S. Department of Labor (DOL) has issued a Final Rule under the Fair Labor Standards Act (FLSA), addressing the conditions under which managers or supervisors may receive or share tips, including whether managers and...more

DirectEmployers Association

OFCCP Week In Review: September 2021 #4

The DE OFCCP Week in Review (WIR) is a simple, fast and direct summary of relevant happenings in the OFCCP regulatory environment, authored by experts John C. Fox, Candee Chambers and Jennifer Polcer. In today’s edition, they...more

Ballard Spahr LLP

USDOL Publishes Final Rule Regarding Monetary Penalties Against Employers for Tip Violations

Ballard Spahr LLP on

On September 23, 2021, the U.S. Department of Labor (DOL) published a final rule announcing when it will assess civil money penalties (CMPs) against employers who retain tips earned by their workers. Under the rule,...more

Fox Rothschild LLP

Warning—Calling Someone A Manager Or Sous Chef Does Not Automatically Make Them Exempt From Overtime Under The FLSA

Fox Rothschild LLP on

The New York City restaurant industry has, over the last several years, been hit with a flood of lawsuits. Many of these have focused on illegal tip pools but many have also alleged that employees were misclassified as...more

Akerman LLP - HR Defense

Tipped and Non-Tipped Work Back Under the Microscope

The old “80/20 rule” is back again for tipped workers under the latest proposed Final Rule issued by the Department of Labor (DOL) last month. Employers in the service industry, especially those employers who take a tip...more

Fisher Phillips

Will Tips Apps Lure Workers Back to Work? What Hospitality Employers Need to Know

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The world is opening up again and Americans are venturing out to travel, shop, and dine out. With the sudden rise in leisure and hospitality sales, the industry is facing an increased need for skilled employees – but...more

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