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6 September 2024

Expert Insights—Tips From Seyfarth: In A Major Win For Restaurants, Fifth Circuit Vacates DOL's 80/20 Rule

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Seyfarth Shaw LLP

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Seyfarth's Ariel Cudkowicz and Michael Steinberg co-authored an article, "EXPERT INSIGHTS—TIPS FROM SEYFARTH: IN A MAJOR WIN FOR RESTAURANTS, FIFTH CIRCUIT VACATES DOL'S 80/20 RULE,"...
United States Employment and HR
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Seyfarth's Ariel Cudkowicz and Michael Steinberg co-authored an article, "EXPERT INSIGHTS—TIPS FROM SEYFARTH: IN A MAJOR WIN FOR RESTAURANTS, FIFTH CIRCUIT VACATES DOL'S 80/20 RULE," inThomson Reuters' Westlaw Todayon September 3. The Seyfarth attorneys discussed the impact of the Fifth Circuit striking down the Department of Labor's December 2021 regulation codifying the DOL's longstanding "80/20 rule" regarding gratuities.

"The Fifth Circuit's decision roundly rejects the 80/20 rule's focus on whether employees' discrete work activities are tip-producing or not, and instead concludes that the plain meaning of the statute is clear: an employer may claim the tip credit for any employee who, when engaged in her job—whatever duties the job entails—customarily and regularly receives more than $30 per month in tips."

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