The Employer’s Wage and Hour Advisor

On August 23, 2024, the Fifth Circuit struck down the U.S. Department of Labor’s (“DOL”) “80/20” rule on how tipped employees must be paid under the Fair Labor Standards Act (“FLSA”). This is welcomed news for employers in the restaurant and hospitality sectors as navigating this complex rule can be challenging. However, employers should beware that there are a growing number of states that have done away with the tip credit entirely and require full minimum wage payments for all work.