FLSA Issues Final Rules Affecting Tipped Workers
The Department of Labor has just issued its final FLSA amendments to regulations concerning the Fair Labor Standards Act, a federal employment law that sets forth several important rules concerning wages and overtime. These amendments hope to clarify questions concerning several pay issues.
One of the areas affected by the final rules concerns tip credits and tip pooling. Under the final amendment, the DOL makes it clear that employees own their tips and an employer may not take or divert the tips for any use, other than for a valid tip pool. An employee still owns the tips he or she receives even where an employer pays full minimum wage.
Further, if an employer plans to rely on a tip credit to as portion of wages, the employer is required to “inform” it employees of its intent to do so, and also must inform employees concerning:
• The amount of direct cash wages an employer is paying an employee;
• The amount of tips that will be credited toward minimum wage;
• That an employee must retain all tips where he or she is in a valid tip pooling arrangement among employees who regularly receive tips;
• The required tip pool contribution; and
• Any additional amount an employer is using as a credit against tips received.
Another area at issue was whether to amend the way overtime pay is calculated for employees who work fluctuating workweeks. However, the DOL rejected proposed amendments, meaning that people who work a fluctuating work week will continue to be paid an additional one-half their regular rate of pay if they work more than 40 hours in a week.
For more information or to learn about how the FLSA amendments may affect you, please contact the experienced Atlanta employment lawyers at Buckley & Klein, LLP.
