6.24.2021

Back to the Future: The U.S. Department of Labor proposes a new tip credit rule to restore the old ...

On June 21, 2021, the Department of America du Travail (DOL) will announce a une nouvelle proposition de règle with regard to the moment at which an employee receives a credit of pourboire et payer a minimum wage inférieur aux employees à pourboire effectuant des tâches dites à pourboire. requests, announce et without tip. The proposed rule first appeared in the federal register on June 23, 2021 and can be publicly commented on until August 23, 2021. The proposal shows employers the new path that President Biden's administration is taking and is drastically moving away from Trump's administrative focus. . .

The Fair Labor Standards Act (FLSA) allows employers to pay "tipped employees" wages of at least $ 2.13 an hour and credit a portion of the tips towards meeting the state minimum wage known as a "tip credit." The rules as to when an employer can receive tips for the time spent on tasks that do not directly generate tips and have been the direct subject of sub-regulatory guidelines that have developed in various legal systems for decades. In 2018 and 2019, President Trump's DOL repealed previous guidance on the matter and published new interpretative documents. The DOL then incorporated these guidelines into its final rule of December 30, 2020 (the 2020 Tipping Rule). However, President Biden's administration has postponed implementation of portions of the 2020 tipping rule until December 31, 2021, including the "duplication" portion of the rule regarding the application of tips to credit. directly and immediately. Advice.

In the Notice of Regulatory Proposal (NPRM) published this week, the DOL is now proposing to remove the "duplicating" part of the 2020 tipping rule and replace it with a radically different regulatory standard that is more in line with the DOL's analysis of the problem. at various times in the past, including during the Obama years. In particular, the new DOL proposal contains the following significant changes and additions:

  • There is no "related functions" test: Under the 2020 Tip Rule "related functions" test, employers could get advice credit for the time a top employee spends on related and unsupported tasks, as long as the tasks were done with no flips on the job simultaneously, such as or for a reasonable period immediately before or after tasks are dumped. The new NPRM would eliminate this test.

  • New definition of the "tipping profession" : The proposed new regulation would define what it means for an employee to be in a "tipping profession" when an employer can receive tips. The proposed rule is that an employee will only be in a "tipping job" if an employee is doing jobs that: (1) tip; or (2) directly supports the dump job if the dump job is not executed for a long time.    The proposed regulation describes "tipping" as work that generally requires "direct customer service" and treats work that "directly supports tipping" as an activity that does not in itself generate a tip but helps a tipped employee with work for the employee receives tips. For example, the proposed regulation states that a waiter's "typing" includes waiting at tables, while "jobs that directly support the waiter's tip" include cleaning tables, folding napkins, preparing cutlery and garnishing Hold dishes before serving food. and sweep under the dining table. Non-waiter jobs include preparing food and cleaning toilets.

  • New 20% restriction on work without tipping: The NPRM would temporarily codify the 80/20 rule for the first time. So if an employee with a tip spends more than 20% of the working week doing "directly supportive" work. . . Tipping work [,] ", the employer cannot receive a tip credit for a period that exceeds 20% of the working week. Instead, the employer must pay the full minimum wage during this time. Cette norm semble semble différer considérablement du concept 80/20 antérieur de DOL, dans la measure où l'itération precédente de 80/20 aurait refused the credit de pourboire pour tout temps consecrated au travail dit sans pourboire si cette activé 20% of the week of work. The current proposal, on the other hand, only denies the tip credit if the excess is more than 20%.

  • New 30-minute limit for working without tip: The NPRM would create a new 30-minute limit for working without tip, which runs continuously and directly supports the work that an employer can receive tip refund. In particular, if an employee with a tip does direct support work without a tip for a "continuous period of more than 30 minutes", the employer cannot receive a tip credit during this period. Instead, under these circumstances, the employer must pay the employee the full minimum wage in cash for the entire working time without a tip. Therefore, an employer can receive tip credit for a block of time in which a waiter does support work directly, such as tablecloths for the next day at the end of a shift, but only if this time does not exceed 30 minutes. .

The NPRM is a proposal to amend the Tipping Ordinance, not a binding standard. DOL will accept comments on this proposal until August 23, 2021. After the comment period has expired, the DOL can issue a final regulation that adopts the proposed language word for word or changes the language in one or more sensible ways. While the matter is still under investigation at DOL, employers should start tipping to reflect on what compliance with the proposed rule would look like. We are at least several months and possibly a year or more away from any final rule on this matter coming into effect, and a litigation over a definitive rule implementing the DOL Acceptance Rule now seems likely. You can find updates on future developments in our blog.

© 2021 Epstein Becker & Green, PC All rights reserved. Revue nationale de droit, volume XI, number 175

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