Department of Labor Proposes New Rule For Tipped Workers


Posted by: Chris

Millions of workers in the U.S. rely mainly on tips for their income. It’s hard enough as it is for these workers to earn enough money to make ends meet, but now, the Department of Labor (DOL) may make it even more challenging. Here’s what you need to know about the DOL’s proposed new rule for tipped workers:

The Current Laws Governing Tipped Workers

Employers in the state of Oklahoma must pay their workers at least $7.25 per hour, which is the federal minimum wage. However, there are exceptions to this rule. The current minimum wage for tipped workers in Oklahoma is $3.63. This means employers can pay tipped workers $3.63 per hour, which is just half of the federal minimum wage. However, this only applies to workers who earn at least $7.25 per hour once their tips and hourly pay is combined. 

The DOL’s Proposed New Rule For Tipped Workers

The difference between the federal minimum wage, which is $7.25, and the tipped worker minimum wage, which is $3.63, is known as the “tip credit.” The DOL’s proposed rule would allow employers to claim this tip credit for any worker who spends more than 20% of their time performing non-tipped duties. Basically, this means that employers would be able to order tipped workers to perform a significant amount of side work while still paying them the minimum wage for tipped workers. The rule would allow employers to do this as long as the side work is performed immediately before or after the tipped work. 

For example, a restaurant manager could order a server to spend the majority of his shift performing side work instead of serving tables. Even though the server cannot earn tips while performing side work, the manager would be allowed to continue paying him the minimum wage for tipped workers under the proposed rule.

Advocates are concerned that the proposed rule could drastically lower tipped workers’ incomes. The less time they spend performing tipped job duties, the less time they have to earn tips. Fortunately, the new law is not in effect yet. The DOL is accepting feedback from the public until December 9th. Then, the DOL expects to make a decision regarding the changes by early next year.

Has your employer refused to pay you minimum wage? If so,  contact Armstrong & Vaught, P.L.C. as soon as possible. Our experienced attorneys will aggressively fight to recover the back pay and damages you deserve. Call us now at 918-582-2500, toll free at (800) 722-8880, or contact us online for a free consultation with a skilled attorney.