The amendments to the FLSA contained in the Act explain that an employer may not keep tips received by its employees for any purposes, including allowing managers or supervisors to keep any portion of employees’ tips or share in the tip pools, regardless of whether or not the employer takes a tip credit. It also rescinds portions of the 2011 Department of Labor (DOL) regulations that prohibited tip pooling when employers paid at least minimum wage and did not claim the tip credit. This means that if an employer pays at least minimum wage to employees, back-of-the-house employees (such as cooks and dishwashers) can once again participate in tip pools.
The Wage and Hour Division of DOL issued a bulletin after the Act’s enactment advising employers that it will proceed with rulemaking in order to address these amendments to the FLSA through new or revised regulations. The bulletin also explained that in the meantime, DOL will use its current regulations to determine whether an individual qualifies as a manager or supervisor—namely, whether the employee qualifies for the executive exemption, whether or not he or she is paid a salary.
Before changing your tip pooling practices, make sure to also check your state laws. For example, Oregon law prohibits employers from using tips as a credit toward paying minimum wage. If you have specific questions about how the new tip pooling laws apply to your workplace, contact Nicole Elgin at (503) 276-2109, email@example.com, or Sean Ray at (503) 276-2135, firstname.lastname@example.org. You can also register here for our next breakfast seminar on advanced wage and hour laws.
Electronic Alerts are written by Barran Liebman attorneys for their clients and friends. Alerts are not intended as legal advice, but as employment law, labor law, and employee benefits announcements. If this has been forwarded to you, and you would like to begin receiving Electronic Alerts directly, please email or call Traci Ray at 503-276-2115. Copyright ©2019 by Barran Liebman LLP.
Las Alertas electrónicas son escritas por abogados de Barran Liebman para sus clientes y amigos. Las Alertas no son proveídas como asesoramiento legal, sino solo como anuncios de leyes de empleo, leyes laborales y beneficios de empleo. Si esto ha sido remetido a usted y quisieras empezar a recibir las Alertas directamente, por favor mándanos un correo electrónico o llama a Traci Ray al 503-276-2115. Derechos de autor ©2019 por Barran Liebman LLP.