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Volume XI, Number 210

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DOL Proposes 30-Minute Cap for Tipped-Wage Side Work, Seeks to Reinstate 80/20 Rule

On June 21, 2021, the Department of Labor (DOL) proposed a new rule to restrict the amount of non-tip-producing work a tipped employee can perform when an employer is taking a tip credit. The proposed rule clarifies that if an employee performs work that directly supports tip-producing work for a substantial amount of time — at least 20 percent of the hours worked in a workweek or at least 30 continuous minutes — the worker must be paid the standard minimum wage. Duties that “directly support” tip-producing activity include: cleaning and setting tables, toasting bread, making coffee, occasionally washing dishes, rolling silverware, filling salt shakers, and other types of daily side work.

Under the Fair Labor Standards Act, employers can claim a tip credit by paying a tipped worker $2.13 per hour in direct wages as long as the worker’s total tips equal the standard minimum wage of $7.25. 

The 80/20 rule has been instituted in various forms since 1988, but this will be the first time the regulation has undergone the regulatory notice-and-comment process. If the DOL adopts the regulation after the notice-and-comment process, the regulation may receive greater deference from federal courts.

© 2021 Dinsmore & Shohl LLP. All rights reserved.National Law Review, Volume XI, Number 174
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About this Author

Faith Whittaker, Dinsmore Law Firm, Cincinnati, Labor and Employment Law Attorney
Partner

A partner in the Employment, Labor and Benefits Department, Faith has experience guiding clients through issues that arise in the workplace. She handles employment-related litigation for her clients, who range from local businesses to Fortune 500 companies.

Understanding each client has different tolerances and objectives in dealing with employment matters, Faith is passionate about learning her client’s industry and gaining insight into their operations. While always prepared to vigorously proceed through litigation, she teams with her clients...

513-977-8491
Shannon Reid Attorney Labor and Employment Dinsmore Cincinnati
Associate

Shannon focuses her practice on labor and employment law. Her experience includes conducting legal research and drafting legal memoranda on the False Claims Act, privacy, and other related issues.  While attending the University of Pennsylvania Law School, she drafted pleadings and argued on behalf of youth in state family court for dependency and Special Immigrant Juvenile Status (SIJS) relief as a certified legal intern. 

513-832-5378
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