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Do Customer Tips Belong the Employee or Employer?

When a customer leaves a tip for a server, who receives the full amount of the tip at the end of the day? According to a 2011 Department of Labor (DOL) regulation, the tip always belongs to the server, even if the employer pays the server minimum wage. However, a recent DOL announcement in late July has put this issue back on the table and may resolve a conflict between courts across the country as to tip practices within the hospitality industry. The 2011 regulation states that tips are the property of the employee regardless of whether the employer pays the employee minimum wage and claims a tip credit. Now, DOL is rescinding this regulation, which will allow employers more flexibility in their tip pooling practices.

"I'm Not Paying For That": Update On Using Timekeeping Policies To Defend Off-The-Clock Claims

We have recently focused upon the growing number of federal court decisions under the federal Fair Labor Standards Act that have given legal weight to carefully-crafted, well-maintained employer policies requiring employees to report all of their worktime. Several such courts have relied upon the principle that workers can recover FLSA-required wages for alleged off-the-clock work only if the employer had actual or constructive knowledge of the work.

Hertz, Thrifty to Pay $2 Million to Settle Local Minimum Wage Complaints

Car rental companies Hertz and DTG Operations Inc. (which operates many of its stores under the brand name Thrifty) have agreed to pay nearly $2 million to settle claims filed by 157 of their workers seeking back wages under the minimum wage ordinance in SeaTac, Washington.

Does Paying Time and a Half For Certain Work Count Toward Overtime? [Wage & Hour FAQ]

Q. Our organization has a policy of paying employees who perform certain kinds of work outside of regular business hours at 1-1/2 times their regular hourly rates. Do we have to pay additional overtime pay for these hours?

Ninth Circuit Rejects DOL's Interpretation of the "Dual Jobs" Regulation for Tipped Employees

On September 6, 2017, the Ninth Circuit Court of Appeals declined to accord deference to the U.S. Department of Labor's (DOL) interpretation of its "dual jobs" regulation. The court reasoned that the interpretation, as articulated in the DOL's Field Operations Handbook (FOH), was inconsistent with the dual jobs regulation and attempted to create a de facto new regulation. The appellate court rejected the FOH's requirement that employers evaluate employee work on a duty-by-duty and minute-by-minute basis to determine whether an employer may take a tip credit for specific time worked. The court favored the DOL's earlier guidance on the regulation, which instructed employers to look for a "clear dividing line" to distinguish between when an employee is engaged in a customarily tipped occupation versus a second and separate non-tipped occupation.

DOL’s “80/20” Tip Credit Rule Entitled to No Deference, Ninth Circuit Holds, Creating Circuit Split

Finding it wholly inconsistent with the statute and the regulation it purports to interpret, the Ninth Circuit has held invalid the United States Department of Labor’s “80/20” tip credit rule, or “20% Rule,” which limits the availability of the tip credit when tipped employees spend more than 20% of their time performing allegedly non-tip generating duties.

Department of Labor Abandons Appeal of Overtime Rule

Yesterday, the U.S. Department of Labor (DOL) asked a federal appeals court to dismiss its appeal of the court order blocking its controversial 2016 “overtime rule” from taking effect, signaling the DOL’s official abandonment of the Obama-era rule in favor of the agency’s plan to pursue less-drastic overtime reform.

With the Overtime Appeal Over, It’s Now Time to Focus on the Do-Over

With the appeal of the overtime injunction in federal court now over, employers and trade associations now need to focus on the overtime do-over that is underway at the U.S. Department of Labor (DOL). More specifically, comments in response to the DOL’s request for information (RFI) regarding potential changes to the salary and duties tests for the white-collar regulations under the federal Fair Labor Standards Act (FLSA) are due no later than Monday, September 25.

Department of Labor Moves to Dismiss Appeal on Obama-Era Overtime Rule (UPDATED 9/7/2017)

As anticipated following last week’s decision by the U.S. District Court for the Eastern District of Texas, striking down the Department of Labor’s May 2016 Final Rule regarding the FLSA’s “white collar” overtime exemptions, the DOL has asked the Fifth Circuit to dismiss its appeal of the district court’s preliminary injunction invalidating the Rule last November. In a succinct, unopposed motion, the DOL noted that the district court’s final judgment rendered the preliminary injunction moot, citing established Fifth Circuit law for that proposition.

The Ninth Circuit Affords No Deference to the DOL's 80/20 Tip-Credit Guidance—Creating a Circuit Split and Potentially Setting Up a Supreme Court Fight

Executive Summary: On September 6, in Marsh v. J. Alexander’s LLC, the Ninth Circuit Court of Appeals refused to give deference to the U.S. Department of Labor’s (“DOL”) tip-credit guidance under the Fair Labor Standards Act (“FLSA”). The guidance—commonly known as the “80/20 rule”—provides that employers may not take a “tip credit” for time spent performing duties “related” to tip-producing activities (e.g., cleaning tables or rolling silverware) if these duties constitute more than 20 percent of the tipped employee’s time in a given week. In holding that the 80/20 rule is inconsistent with the FLSA because it improperly analyzes an employee’s duties rather than the performance of distinct jobs, the Ninth Circuit created a circuit split on this issue, and potentially paved the way for a U.S. Supreme Court decision with national impact.