In July, a federal court refused to block the U.S. Department of Labor (DOL)’s “80/20 rule,” which applies to employers taking the tip credit toward their federal minimum wage obligations. The DOL rule is intended to limit the amount of non-tip producing work that a tipped employee can perform when an employer is taking a tip credit. Here is a good article on the 80/20 rule from Fisher Phillips that restaurant owners should read to…
Restaurants are increasingly adding service fees to customers’ bills. However, service fees are not synonymous with tips, and employers must follow Department of Labor (DOL) regulations for distributing tips. Service Fees vs. Tips There may be instances where restaurants want to add a service fee to a guest’s check at the point of sale. Examples include: Upsell fees for special menus Banquet event fees Takeout or delivery fees Bottle service or corkage charges Service fees…
Tips and gratuities can make up a significant portion of many workers’ earnings. In addition to restaurant workers, employees in other settings such as beauty salons, car washes and valet services routinely receive tips from customers. So, what happens to the cash tip that you handed to the person who washed your car? The business may require the employee to place the tip in a “tip pool.” What is Tip Pooling? Tip pooling is the…
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