Several recent lawsuits have been filed in federal court, one challenging the Dual Jobs Final Rule published by the Department of Labor (DOL) that became effective in late December 2021, and two others filed this week by several state attorneys general challenging President Biden’s Executive Order requiring most federal contractors to pay a minimum wage of at least $15 per hour to their employees.
The Dual Jobs Final Rule established limits on the amount of time tipped employees can spend performing work that is not “tip-producing” and still being paid at the reduced cash wage applicable to tipped employees under the Fair Labor Standards Act (FLSA). The new Final Rule revived the 20% (or “80/20”) Rule, with modifications, and added a “30-Minute” Rule, disallowing the tip credit when a tipped employee spends more than thirty continuous minutes performing work that is not considered tip-producing work. The previous administration had attempted to eliminate the 20% Rule.
The lawsuit against the DOL was filed in a Texas federal court in December 2021, prior to the Final Rule’s effective date, by the Restaurant Law Center (RLC). The RLC is an independent public policy organization affiliated with the National Restaurant Association, the largest foodservice trade association in the world. Through the lawsuit, the RLC seeks to enjoin the DOL from enforcing the Final Rule and to have the Rule invalidated, asserting that it conflicts with the language of the FLSA and that the DOL...
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