On March 18, 2022, the Eleventh Circuit Court of Appeals ruled in Compere v. Nusret Miami, LLC, a collective action under the Fair Labor Standards Act (FLSA), that Nusr-et Steakhouse properly used automatically charged fees on bills to pay its employees’ wages because the fees were service charges. The plaintiffs, a group of tipped employees, had argued these fees were not service charges but instead were tips. The distinction is critical because service charges and tips are treated very differently under federal laws and regulations. Tips are voluntary, given at the discretion of customers, and must be entirely distributed to eligible employees. Bona fide service charges, on the other hand, are not discretionary and need not even go directly to employees. The Eleventh Circuit’s sole focus was whether Nusr-et Steakhouse properly treated the automatic fees added to bills as service charges instead of tips.
For most of the time in dispute, the restaurant classified its service staff as exempt from overtime pay under the FLSA’s 7(i) exemption, applicable to commissioned employees of retail sales or service establishments. Section 7(i) requires, among other things, that employees be paid more than one-and-one-half times the applicable minimum wage under the FLSA for each hour worked and that the majority of their wages be paid from commissions. The restaurant assessed customers a mandatory 18 percent “service charge” on checks, and those service charges were...
NEW DELHI: Assam chief minister Himanta Biswa Sarma on Monday alleged that the entire press conference conducted by Congress leaders Pawan Khera and Gaurav Gogoi was based on material supplied by ...