DOL’s Reading of Tip-Related Regulation Flawed, 9th Cir. Rules

Sept. 7, 2017, 9:32 PM

Former bartenders and servers relied on a faulty Labor Department interpretation of an FLSA regulation that addresses workers who receive tips while working “dual jobs.”

The DOL’s interpretation was inconsistent with the regulation and effectively creates an “alternative regulatory approach with new substantive rules,” the U.S. Court of Appeals for the Ninth Circuit concluded Sept. 6 (Marsh v. J. Alexander’s LLC, 2017 BL 312843, 9th Cir., No. 15-15791, 9/6/17).

The Fair Labor Standards Act lets an employer pay a reduced cash wage and claim a tip credit toward the $7.25-per-hour minimum wage if the employee engages in an...

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