Jeffrey Ruzal Quoted in “DOL’s Proposed Tip Rule Leaves Gray Areas, Attys Say”

Law360 Employment Authority

Jeffrey H. Ruzal, Member of the Firm in the Employment, Labor & Workforce Management practice, in the firm’s New York office, was quoted in Law360 Employment Authority, in “DOL's Proposed Tip Rule Leaves Gray Areas, Attys Say,” by Daniela Porat. (Read the full version – subscription required.)

Following is an excerpt:

On Monday the DOL issued a notice of proposed rulemaking that would bolster wage standards for tipped workers. The regulation is among a batch of more worker-friendly rules the DOL is expected to roll out under the Biden administration. …

Under the planned regulation, an employer can pay an employee the tipped minimum wage when they are doing work that produces tips or performing "work that directly supports the tip producing work," the proposal said. In the latter circumstance, however, a worker must be paid standard minimum wage if those supporting duties exceed certain timeframes.

The change would set a new standard requiring employers to pay the full minimum wage to any worker who spends more than 30 minutes of uninterrupted time on side work that "directly supports" tip-producing activity.

The regulations would also codify the 80-20 rule, which requires standard minimum wage for a worker who spends more than 20% of their work time on side tasks that aren't directly related to customer service, like setting up before a shift or cleaning up afterward. …

The rule does not take into account the nature of hospitality service work where servers might perform other duties during downtime between customers, said Jeffrey Ruzal, a member of management-side firm Epstein Becker Green and leader of its hospitality group.

"In a perfect world you would have workers compartmentalized specifically providing service to customers and then other employees who are specifically doing non-service-related tasks for which they get the full minimum wage without a tip credit," he said. "The regulations do not fairly reflect the reality of the hospitality workplace."