Tips

News & Analysis as of

Employers Must Comply with DOL's Updated Posting Requirements

The Department of Labor (DOL) issued on July 27, 2016, regulations that require covered employers to update their Fair Labor Standards Act (FLSA) Minimum Wage posters and their federal Employee Polygraph Protection Act (EPPA)...more

Another Federal Court Thinks the DOL Is Out to Lunch On Tip Credit Rule

Seyfarth Synopsis: New decision from Northern District of Georgia rejects the DOL’s interpretation of the FLSA tip credit law. Holds that the FLSA does not regulate tips received by employees who are paid at least minimum...more

Food and Beverage Law Update: August 2016

When food and beverage companies think of their largest risks, data breaches have not historically come to mind, but this is changing because of reports in the past few months of major breaches by companies such as Noodles &...more

Employers Limited in Service Fees Deductions From Credit Card Tips

Restaurants and some other businesses that use employees partially compensated by tips can claim a tip credit toward the Fair Labor Standards Act’s minimum wage requirements. However, the FLSA strictly regulates the servers’...more

Fifth Circuit Declines to Broaden Permitted Deduction of Credit Card Fees from Tips

The U.S. Court of Appeals for the Fifth Circuit concluded on June 14, 2016 that an employer may not deduct more than the actual credit card fees associated with liquidated credit card tips for employees without compromising...more

Here's a tip: Don't skim from employee tips

Hospitality industry employers take note: If you claim a “tip credit” toward the minimum wage for any of your employees, you need to make sure that all tips are properly distributed to employees. A recent case from the Fifth...more

What Employers Need to Know About the New State Garnishment Laws, Part I: Michigan and Georgia

The requirements and processes applicable to employers handling garnishments are primarily governed by state laws. Therefore, in addition to the federal Consumer Credit Protection Act (CCPA), multistate employers need to be...more

Franchise & Distribution News, Number 2

Ontario Passes New Legislation Governing Tips and Gratuities - Ontario restaurants, bars and other businesses with employees who receive some of their pay through tips and gratuities will face new laws governing how...more

The Danger of Service Charges in Country Club Operations

Country clubs and other private clubs have traditionally utilized service charges on food and beverage sales to supplement their revenue. In most cases, this supplemental revenue is used to pay higher wages to all employees...more

Tips Belong To Tipped Employees, Regardless Of Whether Employer Takes Tip Credit, Says A Federal Appellate Court

The U.S. Court of Appeals for the Ninth Circuit upheld a U.S. Department of Labor (DOL) rule prohibiting employers from requiring employees to share tips with non-tipped employees, even if the employer does not take the tip...more

Ninth Circuit: FLSA's Tip-Pooling Restrictions Apply Regardless of Whether Employers Use Tip Credits

On February 23, 2016, the U.S. Court of Appeals for the Ninth Circuit in a 2-1 panel decision upheld the U.S. Department of Labor’s (DOL) 2011 revisions to 29 C.F.R. § 531.52 applying tip-pooling restrictions to employers...more

Ninth Circuit Approves DOL Rule that Restricts Tip Pooling

Section 203(m) of the Fair Labor Standards Act (FLSA) allows employers of tipped employees to take a tip credit against the employer's minimum wage obligation if: (a) notice of the tip credit is provided, and (b) tipped...more

Ninth Circuit Ices Back-of-House Tip Pools

The Ninth Circuit Court of Appeals has upheld U.S. Department of Labor regulations invalidating tip-pooling arrangements that include kitchen staff and other employees who are not customarily tipped (often referred to as...more

DOL May Enforce Rules Extending Tip Pooling Restrictions

Since 2010, the law has been in flux as to whether certain restaurant employees may or may not be allowed to participate in tip pools, particularly in states located in the jurisdiction of the U.S. Court of Appeals for the...more

Ninth Circuit Rules Tip Pooling Arrangements That Share Tips With Employees Who Do Not Normally Receive Tips Violate Federal Law

In a game-changing event, on February 23, 2016, the U.S. Court of Appeals for the Ninth Circuit (the court that covers nine western states, including Washington, Oregon and California) in a 2-1 decision ruled that it is a...more

Is Your Tip Pool Policy a Recipe for Trouble?

In a recent blog post, we highlighted the trend amongst hoteliers and restaurateurs toward adopting service charge models to meet the rise in state and local minimum wage requirements. Although “no-tip” and “service charge”...more

Food and Beverage Law Update: January 2016

Key Issues Facing Food Retailers - Compliance and Cybersecurity: Consero Group surveyed the general counsel of Fortune 1,000 companies in June 2015 and learned that 60 percent still lack the proper preparation for a...more

Chebotnikov v. LimoLink, Inc.: a Cautionary Tale Concerning the Use of Forum-Selection Clauses

At the end of last year, a federal court in Massachusetts found that a forum selection clause in an Iowa company’s standard form service-provider agreement did not apply to claims asserted under the Fair Labor Standards Act...more

New York Adopts Tipped Worker and Fast Food Worker Minimum Wage Regulations

As we reported previously, the New York State Department of Labor (“NYSDOL”) proposed a series of new regulations earlier this year. These proposals included new regulations raising the minimum wage and reducing the maximum...more

UPDATE: Employee Tip Pooling – Don’t Say We Didn’t Warn You!

We have talked with you in the past about the risks of allowing employees to pool or share tips. This is a pretty common practice in the food service industry, but there can be concerns because of the complexity of compliance...more

Minimum Wage To Increase For Many In 2016

A number of states and local jurisdictions will raise their minimum wage in 2016; here is the latest information on what to expect in the new year....more

Minimum Wage To Increase For MA Hourly and Tipped Workers

Starting January 1, 2016, the minimum wage in Massachusetts will be $10.00 per hour. Before Governor Deval Patrick left office, he signed into law an increase in the state minimum wage in three successive annual increments...more

A Legal Tipping Point – Are No-Tip Policies the Wave of the Future?

In this country, there are thousands of employees who earn their living off tips or gratuities they receive from customers. Over the last several years, there has been a movement afoot, particularly in the restaurant...more

Tip Pooling Tax Implications—What Employers Need to Know

The sharing of tips is referred to as “tip pooling,” “tip splitting,” or “tip sharing.” For purposes of this discussion, we will refer to the sharing of tips as tip pooling. Tip pooling occurs generally in two forms....more

Hospitality, Food and Beverage Industry Newsletter

We are pleased to share the first edition of our Hospitality, Food and Beverage Industry Newsletter with you. This Newsletter addresses important recent legal developments affecting the hospitality and restaurant industry and...more

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