Employers that utilize the “tip credit” under the federal Fair Labor Standards Act, or whose employees receive tips, should carefully consider regulatory changes that were proposed by USDOL today.
Here is a handy summary of the minimum wage increases applicable to most employers in 2019, including New Jersey's new legislation. Illinois' recent bill calls for an increase in 2020.
The USDOL has removed the infamous "20% Rule" from its Field Operations Handbook, but employers should be mindful of its disjointed approach to revisions across and within agency materials.
Despite most of the government being occupied with the "shutdown" dilemma, the unaffected USDOL has remained busy and gifted us with two opinion letters today.
Here is a handy summary of the minimum wage increases applicable to most employers in the coming year.
USDOL has finally clarified the so-called “20% Rule” limiting the use of the FLSA tip credit even with respect to individuals qualifying as “tipped employees”, and revised the Field Operations Handbook accordingly.
The USDOL recently announced that it will continue its Payroll Audit Independent Determination (PAID) program, and wasted no time beginning its efforts to further educate employers and attorneys about the benefits of the program.
In an opinion illustrating the tangled web we weave when de-facto legislation takes place outside of Congress, the Ninth Circuit in Marsh v. J. Alexander's gave deference to the USDOL's sub-regulatory "20% Rule", restricting an FLSA tipped employee's activities, essentially on the basis that the agency's position was previously available online and that employers were therefore presumed to have notice of its potential effect.
Tip credit controversies are alive and well as employers seek clarity on the USDOL's so-called 20% Rule regarding "tipped employees" engaging in activities that do not, or at least not directly, produce tips.
After 80 years with the USDOL, the FLSA needs a shakeup. The problem is that, even as we anxiously await proposed regulations from the current agency and contemplate how things might be under a potential new one, it’s the 80-year-old law that needs change, and not just because it is outdated.