Pizza Today - September 2021 - 62

No. 1: The 80/20 rule
The 80/20 rule from the
Department of Labor (DOL)
said that restaurant owners
could not take a tip credit for
work performed by a tipped
employee if that individual
spent more than 20 percent
of their time doing side tasks
that are not immediately tip
generating. Common restaurant
side tasks include setting
up for a shift, rolling silverware
and cleaning tables.
" So, if you have an employee
who spends 30 percent
of his or her work time setting
up a restaurant before
opening and doing other prep
work, the Department of
Labor takes the position that
the employee should be paid
at least minimum wage during
that time, " says DeCamp,
now the national co-chair of
Epstein Becker Green's Wage
and Hour Practice Group.
While the oft-contentious
80/20 rule was slated to
evaporate last March, the
Biden Administration halted
the change. Currently reviewing
comments, the DOL will
not make any changes to the
80/20 rule until the close
of 2021. Notably, numerous
states, including California,
Minnesota and Washington,
do not allow the tip credit,
while legislators in many
other states are pushing for
the same.
An issue fraught with risk
for restaurants, DeCamp
suggests operators eliminate
or reduce the time tipped
employees partake in opening
or closing tasks that
count toward the 20 percent
of non-tipped time; pay employees
the full minimum
wage rate during shoulder
periods like opening and
closing; and assign nontip
generating work to
employees not taking the
tip credit.
" It makes sense to do
what you can to minimize
risk, " DeCamp says.
No. 2: Combined tip
pools
The DOL has long taken
a stance against combined
front of the house
and back of the house
tip pooling. As of April
30, 2021, however, DOL
regulations implementing
a March 2018 change
to the federal Fair Labor
Standards Act now permit
tip sharing with backof-the-house
employees,
such as dishwashers or
line cooks, so long as the
restaurant pays everyone at
least the minimum wage.
Going this route, restaurants
also avoid any 80/20
rule uncertainty since no
employees are subject to
the tip credit.
Many in the restaurant
industry saw the recent
DOL rule as a positive development
that could help
in the recruitment of backof-the-house
employees
and compel employees
across the operation to
work together to ensure
positive guest experiences.
In some states, however,
any tip pool must
be purely voluntary - and
what counts as voluntary is
sometimes tricky. Camilla
Hundley, Feinberg's colleague
at PilieroMazza,
suggests restaurants de62
/ PIZZATODAY.COM / SEPTEMBER 2021
No. 3: Supervisors in
the tip pool
Another DOL rule took
effect April 30 as well:
managers and supervisors
are prohibited from receiving
employees' tips as part
of any tip pooling arrangement.
While that directive
might seem rather
straightforward, DeCamp
considers it a " red flag
issue " given ambiguity
around the term " supervisor. "
Is a lead server considered
a supervisor? What
about a head bartender?
The DOL is now trying
to determine who is - or
who is not - excluded
from the tip pool. As a
practical matter in today's
restaurants, these lines can
blur as some employees
take on added responsibilities
amid labor shortages.
DeCamp's suggestion
for the time being: " To
the extent that you have
people with supervisory
responsibilities serving
customers, be careful about
them being in the tip pool
with anybody else. If this
is something you're going
to do, then talk to counsel
first. And if there's any
doubt, then keep these
people out of the tip pool. "
velop a set of practices for
operating a tip pool as well
as tipping standards that
management and employees
clearly understand.
" Have this posted in the
restaurant or have tipping
policies outlined in an
employee handbook that
employees then acknowledge
and sign upon their
hiring, " Hundley says.
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Pizza Today - September 2021

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