News & Analysis as of

Tips Fair Labor Standards Act

Restaurants: Do your employees know that you take the tip credit?

by Franczek Radelet P.C. on

If not, you might have a problem. In 2011, the U.S. DOL published a regulation mandating that restaurants who count tips toward the minimum wage as permitted under the Fair Labor Standards Act have to notify employees...more

Tip Pooling by Restaurant Owners-Remains in Flux

by Goulston & Storrs PC on

Restaurant owners with tipped employees should take note of several recent court cases which may affect their ability to cause restaurant employees to participate in “tip pooling,” particularly in instances where...more

Don’t Be Stingy With Tip Credit Notification...

by Nexsen Pruet, PLLC on

This week, our Charleston office held its Legal Grounds coffee break. The Legal Grounds event provides an opportunity for managers, owners, and human resources personnel in the food and beverage and hospitality industries to...more

Employers Must Comply with DOL's Updated Posting Requirements

by Holland & Knight LLP on

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

by Seyfarth Shaw LLP on

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

by Holland & Knight LLP on

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

by Littler on

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

by Franczek Radelet P.C. on

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

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

by Littler on

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

by FordHarrison on

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

DOL May Enforce Rules Extending Tip Pooling Restrictions

by Conn Maciel Carey LLP on

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

by Perkins Coie on

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?

by Garvey Schubert Barer on

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

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

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

by McNees Wallace & Nurick LLC on

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

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

by FordHarrison on

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

Hospitality, Food and Beverage Industry Newsletter

by Buchalter on

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

DOL Announces Increase in Minimum Wage Rate for Federal Contractors

by FordHarrison on

The Department of Labor (DOL) has announced that the minimum wage for certain federal contracts will increase to $10.15 per hour beginning January 1, 2016. Additionally, the minimum cash wage that generally must be paid to...more

Fifth Circuit Tips Its Hand as to Analysis of FLSA’s Tip Credit

Restaurants throughout the Fifth Circuit, and even beyond, should review the recent decision of Montano v. Montrose Restaurant, which discusses the often tricky and always fact-intensive question of whether a restaurant...more

Fifth Circuit Rules on Tip Pooling

by Littler on

In Montano v. Montrose Restaurant Associates, Inc., the U.S. Court of Appeals for the Fifth Circuit was presented with what may seem like an easy issue:  does including a “coffeeman” in a tip pool invalidate the tip credit? ...more

Navigating the Treacherous Waters of Tipped Employee Wages

by Burr & Forman on

As evening sets, many restaurants will find themselves bustling with customers and loyal patrons eager to put the day's work to rest. But while managers focus on reservations, inventory, food allergies, and table checks,...more

West Virginia DOL Withdraws Proposed Emergency Wage and Hour Regulations

by Littler on

In welcome news for employers, the West Virginia Department of Labor (WVDOL) has withdrawn a set of emergency regulations that would have significantly revamped state wage and hour requirements and created conflicts with...more

Tip-Related Claims Will Continue to Be Served Up as the Lawsuit du Jour Against the Hospitality Industry in 2015

by Epstein Becker & Green on

The hospitality industry is particularly fertile ground for a wide variety of wage and hour issues, which continue to plague management through steadily increasing federal and state department of labor investigations and...more

FAQs on Compliance With the Federal Tip Credit

Many employers in the hospitality industry employ individuals who receive customer tips or gratuities in the ordinary course of their work day. These tips may serve as an offset against an employer’s minimum wage obligations...more

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