As a result of increased focus on employee rights and safeguards, the Pennsylvania Department of Labor and Industry recently implemented new wage and hour regulations under the Pennsylvania Minimum Wage Act. These new regulations, which became immediately effective on August 5, 2022, make significant changes for employees who receive tips or service charges. There are five critical changes that directly affect all beverage and hospitality businesses operating within Pennsylvania. These new regulations include:
An update on the definition of a “tipped employee.” Previously, Pennsylvania’s regulations were in line with the federal standard that only required a tipped employee to receive $30 per month in tips before an employer could reduce an employee’s hourly pay from $7.25 per hour. Now, Pennsylvania diverges from the federal standard and an employee must receive at least $135 in tips monthly before an employer can reduce the employee’s hourly pay.
Now enshrined in Pennsylvania law is the existing federal “80/20 rule”. This rule now mandates that a “tipped employee” can spend no more than 20% of the workweek performing non-tipped duties and must spent at least 80% of their time doing work that can earn tips. This means if a server spends more than 20% of their work time completing such tasks as refilling ketchup bottles, preparing silverware, or preparing foods, their employer is not permitted to take a tip credit and must pay the full minimum wage for any time...
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