DOL Issues Press Release Proposing to Reverse Position on Mandatory Tip Pools

Jeff Storch | 12.05.17

The Department of Labor issued a press release December 4, 2017, proposing to reverse its earlier position that employers of tipped workers could not impose a mandatory tip pool that included non-tipped workers, even if the employers did not take a tip credit.The DOL faced a legal challenge in the 9^th Circuit on the issue, and the release indicates the DOL is retreating from that position.

Assuming this change goes through, employers who pay workers the full federal minimum wage can allow employees who do not traditionally receive tips directly (such as restaurant cooks and dish washers) to participate in tip pools. However, employers who take the tip credit still will be restricted in who may participate in tip pools. In addition, certain states have specific rules limiting tip pooling in those states.

The release is available at https://​www​.dol​.gov/​n​e​w​s​r​o​o​m​/​r​e​l​e​a​s​e​s​/​w​h​d​/​w​h​d​2​0​1​71204

• Employment