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Wednesday, December 23, 2020
Rules relating to tip credit and pooling have resulted in a significant amount litigation in the hospitality industry, and, in many cases, substantial liability or settlements. Yesterday, the U.S. Department of Labor (“DOL”) announced its new final rule that revises current regulations pertaining to tipped employees. The final rule specifically addresses tipped occupations that qualify for application of a tip credit, as well as permissible and impermissible tip pooling practices.
Allowance of Tip Credit for Tasks Related to Tip-Producing Occupations
The final rule codifies the DOL’s previous guidance that employers may take a tip credit for any amount of time an employee in a tip-earning occupation performs related to non-tipped duties performed contemporaneous with, or within a reasonable time immediately before or after, the tipped duties. The final rule identifies certain front-of-the-house tasks, including cleaning and setting tabl
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Rules relating to tip credit and pooling have resulted in a significant amount litigation in the hospitality industry, and, in many cases, substantial liability or settlements. Yesterday, the U.S. Department of Labor (“DOL”) announced its new final rule that revises current regulations pertaining to tipped employees. The final rule specifically addresses tipped occupations that qualify for application of a tip credit, as well as permissible and impermissible tip pooling practices.
Allowance of Tip Credit for Tasks Related to Tip-Producing Occupations
The final rule codifies the DOL’s previous guidance that employers may take a tip credit for any amount of time an employee in a tip-earning occupation performs related to non-tipped duties performed contemporaneous with, or within a reasonable time immediately before or after, the tipped duties. The final rule identifies certain front-of-the-house tasks, including cle