The Wage and Hour Division of the Department of Labor (“DOL”) today rescinded Obama-era enforcement guidance that had made the tip credit unavailable to tipped employees who spend more than 20% of their time performing allegedly non-tip generating duties. The so-called “80/20” Rule has spawned a number of lawsuits, many of them collective actions, claiming that servers spent too much time performing allegedly non-tipped work. Reissuing an opinion letter first promulgated at the end of the George W. Bush administration in 2009, the DOL now clarifies that it “do[es] not intend to place a limitation on the amount of duties related to a tip-producing occupation that may be performed, so long as they are performed contemporaneously with direct customer-service duties and all other requirements of the Act are met.”

More information on this significant development can be found here and in a forthcoming Jackson Lewis web article. In the meantime, if you have any questions about this development or any other wage and hour or class/collective action question, please consult the Jackson Lewis attorney(s) with whom you regularly work.