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”.
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.
Legislation has been introduced that would ultimately more-than-double the FLSA's minimum wage from today's $7.25 an hour to $15 an hour.
There is no such thing as an FLSA "subminimum wage for tipped workers".
Tipped-worker employers should immediately respond to the misleading "tipped minimum wage" PR campaign.
A White House report promoting a substantial jump in the FLSA's minimum wage perpetuates now-widely-disseminated propaganda about an alleged "tipped employee minimum wage" of $2.13 per hour.