The Employer’s Wage and Hour Advisor

Think that tips have to stay with front-of-house staff?

Well, it may be time to think again.

On December 22, 2020, the Department of Labor (DOL) issued a final rule allowing employers who do not take a tip credit against their minimum wage obligations to implement mandatory tip pools in which employees who traditionally have not been able to participate in tip pools—such as cooks and dishwashers—may now receive a portion of the tips left by guests.  However, employers, managers, and supervisors still cannot participate in the tip pool, regardless of whether the employer takes a tip credit. 

The Department of Labor (DOL) recently announced a final rule regarding the Fair Labor Standards Act’s (FLSA) overtime exemption for certain employees in retail and service industries who are paid primarily on commissions.  Issued without the typical notice-and-comment rulemaking, the final rule withdraws two provisions from the regulations about the “retail concept.”  These provisions listed industries that the DOL viewed as either having “no retail concept” or “may be recognized as retail,” impacting whether certain industries asserted whether they had a retail concept and had workers that were subject to the exemption.  By eliminating the lists, certain industries and businesses have more flexibility in determining whether they qualify as an establishment with a retail concept.

On January 13, 2020, the U.S. Department of Labor (DOL) announced the final rule that will be used to determine joint employer status under the Fair Labor Standards Act (FLSA). The final rule is expected to become effective on March 16, 2020.