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New DOL Guidance on Tip Credit: Elimination of "80/20" Rule, Best Practices for Hospitality Employers

Recording of a 90-minute CLE webinar with Q&A

This program is included with the Strafford CLE Pass. Click for more information.
This program is included with the Strafford All-Access Pass. Click for more information.

Conducted on Tuesday, February 19, 2019

Recorded event now available

or call 1-800-926-7926

This CLE course will provide guidance to employment counsel in handling wage and hour issues for tipped employees now that the DOL has eliminated the "80/20" tip credit rule. The panel will discuss what types of job duties may qualify as "tipped work" and best practices for hospitality employers in calculating wages for tipped employees under the new rule.

Description

On Nov. 8, 2018, the DOL rescinded the prior "80/20" rule that made the tip credit unavailable for tipped employees who spend more than 20% of their time performing non-tip generating duties. Many employers found the 80/20 rule unworkable since it required them to monitor and account for tipped employees' duties and whether a tip credit applied.

Commonly, servers spend time cleaning and setting tables, rolling silverware, stocking service areas, and filling condiment containers. In these situations, the DOL previously applied the 80/20 rule, where these related side duties could not exceed 20% of the employee's time for the employer to utilize the tip credit.

Under the new policy, there is more explicit guidance on what is considered "related" side work. Employers are also no longer required to track the time spent on side work as long as the work is performed during or immediately preceding or following tip-generating work.

Listen as our distinguished panel assists employment attorneys in interpreting the current DOL tip credit guidance. The panel will specifically discuss what types of non-tip generating work impacts whether tip credit applies and best practices for hospitality employers in tracking and calculating wages owed to tipped employees.

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Outline

  1. Overview of prior DOL "80/20" tip credit rule
  2. Analysis of current DOL guidance on the tip credit
  3. Calculation of wages for tipped employees under new guidance
  4. Best practices for employment counsel in drafting and updating employment policies for tipped employees after new DOL guidance

Benefits

The panel will review these and other relevant topics:

  • What is the current DOL guidance on tip credit?
  • What types of job duties are affected by the new DOL guidance?
  • How should hospitality employers calculate wages for tipped employees in light of the new guidance?

Faculty

Davis, Mary Elizabeth
Mary Elizabeth Davis

Member
LeClairRyan

Ms. Davis focuses her practice on advising management in all areas of labor and employment law. She regularly...  |  Read More

Luce, Cheryl
Cheryl A. Luce

Atty
Seyfarth Shaw

Ms. Luce is a member of the firm's Labor & Employment Department and Wage & Hour Litigation Practice Group....  |  Read More

Simpson, Matthew
Matthew R. Simpson

Partner
Fisher & Phillips

Mr. Simpson represents management in all areas of labor and employment law in state and federal courts as well as...  |  Read More

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