On Thursday, the Restaurant Law Center is leading the effort of asking the U.S. Supreme Court to hear a case, National Restaurant Association, et al. v. U.S. Department of Labor, et al., brought by the National Restaurant Association, the Alaska Cabaret, Hotel, Restaurant and Retailers Association, the Oregon Restaurant and Lodging Association, and the Washington Hospitality Association. The case challenges the Department of Labor’s anti tip-pooling stance that prevents cooks and dishwashers from receiving tips.
“The Department of Labor has completely overstepped its regulatory authority and is unfairly discriminating against those restaurant employees who work in the back-of-the-house,” says Angelo Amador, executive director of the Restaurant Law Center. “The law here is clear: employees who earn above minimum wage should be able to share their tips with fellow employees, no matter where they work. The Department of Labor cannot continue to trample on the rights of restaurant workers.”
The Fair Labor Standards Act’s (FLSA) tip credit regulations prevent front-of-the-house restaurant employees from sharing tips with back-of-the-house employees if the employer takes a tip credit, meaning some employees earn a tip wage. However, the Department of Labor has now expanded the tip credit regulations, without Congressional action, and is refusing to allow employees to share tips even if the employer does not take a tip credit. This violates the clear language of the law and the intent of the law.
“The Labor Department’s 2011 regulation barring tip pools that include kitchen staff is contrary to the plain language of the FLSA,” says Paul DeCamp, attorney of record on the case. “The Ninth Circuit’s ruling conflicts with not only the Fourth Circuit’s interpretation of the statutory language, but with the interpretation that the Ninth Circuit itself gave in its 2010 decision in Cumbie v. Woody Woo, Inc. It is incumbent on the U.S. Supreme Court to render a decision on this matter against the Department of Labor’s regulatory overstep.”
The original case, Oregon Restaurant Association, et al. v. Perez, et al., was filed after the Department of Labor issued new regulations that barred tip pools from including kitchen staff in response to the Ninth Circuit 2010 decision in Cumbie v. Woody Woo, Inc., which upheld the right to run a tip pool that includes kitchen employees in certain circumstances.