Paul DeCamp, Member of the Firm in the Employment, Labor & Workforce Management practice, in the firm’s Washington, DC, office, was quoted in Law360 Employment Authority, in “Biz Groups Tell 5th Circ. EPA Ruling Blocks Tip Credit Rule,” by Irene Spezzamonte. (Read the full version – subscription required.)
Following is an excerpt:
The U.S. Supreme Court's decision on the Environmental Protection Agency's ability to regulate greenhouse gas emissions backs two groups' argument that the U.S. Department of Labor's rule regulating tipped wages is illegal, the groups told the Fifth Circuit.
The Restaurant Law Center and the Texas Restaurant Association said Friday that the high court's June ruling in West Virginia et al. v. Environmental Protection Agency et al. supports their view that the DOL didn't have the authority to implement the rule, pressing the appellate court to flip a lower court's decision not to enjoin the rule.
"The Supreme Court has cautioned that agencies cannot hide 'elephants in mouseholes,'" the groups said, citing the EPA ruling. "The department has tried to do exactly that by using a non-existent ambiguity to create a completely new test for when an employer can exercise its statutory right to take a tip credit that conflicts with the plain text of the [Fair Labor Standards Act]." …
"In light of these cold, hard numbers, the department can no longer perpetuate this myth that compliance costs somehow abruptly ended the day that the final rule became effective," the groups said. "To the contrary, the record is undisputed that businesses will expend a decade's worth of resources to comply with the final rule — an indication of just how sweeping and disruptive the final rule is to the associations' members." …
The groups and the DOL are arguing in the lower court over whether the EPA ruling and the major questions doctrine apply to the matter.
"Under these circumstances, justice requires not only a reversal of the district court's irreparable injury finding, but also a clear statement by the Fifth Circuit that the plaintiffs are likely to prevail on the merits because the regulation is illegal," DeCamp said.
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