DOL Opinion Letter Reinstated and Changed 80/20 Tipped Work Rule

80/20 Rule Retracted and Clearer Guidelines Reinstated

The Department of Labor retracted the 80/20 Rule and established new guidelines. This change considerably reduced the existing confusion regarding tipped credits for tipped employees.

The 80/20 Rule, which began in 2009, prohibited employers from taking a tip credit from employees who spent more than 20 percent of their time doing non-tipped work. Keeping track of which employees were working on what tasks and monitoring and documenting the work was difficult and confusing. Some duties were related to tipped work even though not directly dealing with customers.

DOL Opinion Letter Reinstated and Changed 80/20 Tipped Work Rule

Based on the Fair Labor Standards Act (FLSA), restaurant employers can pay a tipped employee $2.13 per hour and take a tip credit equal to the difference between the tipped wage and federal minimum wage. The federal minimum wage is $7.25 per hour. Some work is related to the tipped employees relationship with the customer.

According to JD Supra, Opinion Letter FLSA2018027 reinstated an earlier opinion letter that clarified which duties would be related to tipped activities. For example, a list of related duties is not limited to but includes the following:

  • Taking orders from guests for beverages or food
  • Checking with customers to get feedback and correct problems
  • Checking IDs for minimum age for alcoholic beverages
  • Collecting customer’s payments
  • Writing orders on bills or entering them into computers
  • Preparing and totaling checks
  • Giving menus to customers and answering questions about menu items
  • Removing dishes or glasses from tables
  • Cleaning tables and counters
  • Preparing tables for meals
  • Escorting customers to tables
  • Stocking service areas with coffee, silverware, etc.
  • Bringing wine selections to tables and pouring wine
  • Filling salt, pepper, sugar, cream, condiments and napkin containers
  • Doing food preparations such as salads, cold dishes, desserts and brewing coffee
  • Garnishing and decorating dishes in preparation to serving

Employees, who actually work dual jobs, such as a server who also works for the restaurant as a maintenance person, would fall under the 80/20 Rule. However, it would be clear when the employee was doing the server job and when doing the maintenance work.

This change is a significant one for restaurant owners and should reduce litigation that arose out of the confusion created by the 80/20 Rule.

At Stephen Hans & Associates we provide employers with legal assistance for many different types of employment related issues.



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Age Discrimination: ADEA Becomes More Far Reaching

The Supreme Court Rules that ADEA Applies to All Government Levels

In October 2018, the Supreme Court reached a decision that made the Age Discrimination in Employment Act (ADEA) cover a broad scope of state and local employment. The ADEA prohibits age discrimination against employees who are 40 or older, making it illegal for certain size businesses.

Prior to the ruling, state and local governments that employed 20 or less employees could lay-off or terminate employees based on age without facing any repercussions.

The Case that Changed the Application of the ADEA

In the case Mount Lemmon Fire District v. Guido, U.S., No. 17-587 two firefighters brought a case against the Mount Lemmon, Arizona, Fire District based on age discrimination. Their ages were 46 and 54 and they alleged that the fire department laid them off based on age. The defense did not deny that age was the reason but instead argued that the anti-age discrimination law didn’t apply to them because they had too few employees.

The court decided that the intent of the law was not to clarify but to add the category of “a state or political subdivision of a state” as being subject to the ADEA. As a result, state and local governments irrespective of their size must follow the Age Discrimination in Employment Act.

ADEA Claims and Predictions

Currently, approximately 22 percent of claims filed with the Equal Employment Opportunity Commission (EEOC) are age discrimination claims. In addition, an increasing number of employees, who are older than 67 are continuing to work. This fact indicates that age discrimination claims are likely to remain a major focus for the EEOC.

Do You Have Questions about Employment Law?

Keeping up with changing laws is vitally important for operating a business in today’s world.

If you have questions, our attorneys at Stephen Hans & Associates are glad to advise regarding your concerns or represent you in employment related disputes.

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Wage and Hour: What Is a DOL Opinion Letter?

Can a DOL Opinion Letter Help an Employer with a Wage & Hour Dispute?

wage and hour dispute an employe

A Department of Labor (DOL) opinion letter is a letter issued by the Administrator that can address fact-specific questions related to federal wage and hour laws.

An opinion letter can provide an employer with guidelines for dealing with a specific situation. When being followed, it also constitutes a good faith defense to a wage claim brought against an employer under the FLSA.

The DOL had used opinion letters as part of their standard practice for 70 years before they were discontinued and replaced with general guidance in 2010. However, the DOL reinstated their use in June 2017. The reinstatement had the purpose of clarifying the understanding of the Fair Labor Standards Act (FLSA) and other laws for employers and employees.

DOL Administrator Interpretations of the Fair Labor Standards Act (FLSA)

The Administrator can issue interpretations of the FLSA, Davis-Bacon Act (DBA) or Walsh-Healey Public Contracts Act (PCA). Having an interpretation can assist an employer who follows it, when by comparison, without the opinion letter the employer’s actions might be interpreted as a legal violation.

Only Administrator’s rulings or interpretations have authority. Or, in the Administrator’s absence, an Acting Administrator, Deputy Administrator or Deputy Administrator for Program Operations has authority to issue an opinion letter. In this instance, their interpretations or rulings serve as official Wage and Hour Division rulings.

Even so, portions of interpretations or whole interpretations are sometimes withdrawn based on court decisions or new information.

Reliance on Opinion Letters Should Be Specific

In the case Perry v. Randstad General Partner, No. 16-1010 (6th Cir. Nov. 20, 2017), the Sixth Circuit Court ruled that the employer did not establish good faith in its use of an opinion letter. The court found differences between the specific situations referenced in the opinion letter and the employer’s application of it. The primary differences where that the staffing managers did not have the authority to hire or fire employees and they also did not supervise the employees after they were placed in a job.

Our attorneys at Stephen Hans & Associates are glad to discuss employment issues and have decades of experience representing employers in employment related disputes.




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Employment Ad Discrimination: Where to Draw the Lines

Facebook Faces Allegations of Job Ads that Discriminate Against Women

When an employer creates an ad that excludes a protected class, grounds often exist for a discrimination lawsuit. For example, when writing most employment ads, it is illegal for employers to exclude applicants based on age or race.

According to a New York Times article, the American Civil Liberties Union (ACLU) and the Communications Workers of America (CWA) filed charges with the EEOC on behalf of female workers against nine employers and Facebook.

Why Was Facebook Included in the Lawsuit?

Facebook provides targeting technology for ads. It can target particular demographics and when an employer is placing an ad, Facebook asks the employer to indicate gender — that is to say, should the ad go to males only, females only or all. Facebook uses algorithms to match an ad with a specific subgroup.

The attorneys bringing the case are arguing that having employer specify male or female is discriminatory and illegal when it applies to jobs that either sex can do. Facebook differs from newspapers with classic ad submission where the content of the ad is simply printed and goes out to anyone who purchases the newspaper.

Employers’ Defense

In the past, Facebook has used the Communications Decency Act as its strongest defense against such accusations. The Communications Decency Act is a federal law that shields internet companies against liability for content generated by third parties.

The lawyers bringing the lawsuit argue that in this situation, employers are using the Facebook platform to be selective in the creation or development of the unlawful content. The interface enables employers to selectively exclude women from jobs that they could potentially also do.

Federal law also prohibits recruiting agencies from discriminating through advertising campaigns that exclude job candidates based on gender and other protected classes (age, disability, race, ethnicity, military status, etc.) State laws also forbid such agencies from aiding in discrimination.

While Facebook does not promote itself as a recruiting agency, many employers use it for recruitment and as a means to reach potential job candidates through ads. Facebook finds itself in a unique position when a group of men receive ads simply because they are men and often because they are men of a certain again and geographical area.

From a legal standpoint, internet technology like Facebook uses is still subject to case precedents, which will decide whether selecting “male only” is legal or not for recruitment ads and which parties are liable.

Our attorneys at Stephen Hans & Associates are glad to discuss employment issues and help business owners create discrimination-free work environments.



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Compliance with “Cooperative Dialogue” for Accommodation Requests

What Does Cooperative Dialogue Mean Under New NYC Law?

As of October 15, 2018, employers have a new law they must comply with when an employee requests an accommodation based on their civil rights. Many business owners are aware of the recently passed New York City Civil Rights Law that requires distribution of anti-sexual harassment policies and annual anti-sexual harassment training for all the business’s employees. However, this new law regarding cooperative dialogue slipped through without many people realizing it.

Based on NYC procedural law, a mayor can do the following: sign the bill, veto it or take no action. When the mayor takes no action, the unsigned bill goes into effect. This is what occurred with the recent bill addressing Cooperative Dialogue for Accommodation Requests.

What are the provisions of the new cooperative dialogue law?

Society for Human Resource Management (SHRM) outlines the main provisions of the new law. The law applies when employee requests a workplace accommodation. The basis for accommodation requests may be due to religious practices, disability, pregnancy, childbirth and related medical conditions or based on domestic violence, sex offenses or stalking. NYC employers with four employees or less must comply with the new law.

The employee triggers the legal obligation by requesting an accommodation. The employer receives notification of it either by the employee or employee’s surrogate (someone representing the employee).

Next, the employer must engage in cooperative dialogue with the employee or surrogate regarding the request. Cooperative dialogue can be written or oral communications. Employers should also have dialogue about the possible accommodations to address the request and should mention any potential difficulties in accommodating it.

In addition, the employer must provide the employee with written documentation of the final determination, which includes whether the employer granted or denied the accommodation. Employers can deny accommodation requests only after reasonable dialogue has taken place about the accommodation.

Penalties for Failure to Comply

Under NYC Human Rights law, employers may face charges of unlawful discrimination. Employees can file complaints with the NYC Commission on Human Rights. The commission can initiate a commissioner’s charge and employees can privately sue. They can seek compensatory, punitive, equitable and injunctive relief. They can also seek up to $25,000 per violation and up to $250,000 for a willful, wanton or malicious violation plus attorney’s fees through a civil lawsuit.

Do You Have Questions about Employment Law?

Our attorneys at Stephen Hans & Associates are glad to advise regarding your concerns.



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What Is the Faragher-Ellerth Affirmative Defense?

An Affirmative Defense for Employers

Affirmative defense is a legal term that offers some degree of protection for employers. We live in volatile times, an age where #MeToo is changing the legal landscape and sexual harassment claims are becoming very prevalent.

While many wrongs are being righted, it has also opened the door to the possibility of false claims. You may ask, “What protection do employers have?”

Womans Equal Rights, NY Equality Act

The Faragher-Ellerth Defense

The Faragher-Ellerth Affirmative Defense arose from two cases heard by the U.S. Supreme Court. The court’s decisions established precedents for affirmative defense for employers who faced accusations of sexual harassment. It has also served as a defense guideline against hostile work environment harassment claims based on other protected classes.

The defense may offer protection to employers if the following circumstances exist:

  • The employer exercised reasonable care to prevent and promptly correct the harassment. (Companies’ harassment polices show the business has taken effective preventative measures.)
  • The plaintiff employee unreasonably failed to take advantage of any preventative or corrective opportunities the employee provided or failed to otherwise avoid harm.
  • The employer or supervisors did not take tangible adverse actions against the complaining employee, such as demotion, termination or an undesirable reassignment.

Based on a Recent Ruling, Employers Should Be Proactive in Preventing Sexual Harassment

In a recent case, Minarsky v. Susquehanna County, the County used the Faragher-Ellerth affirmative defense and the district court granted the County summary judgment. However, the Third Circuit Court vacated the judgment by ruling that the case should be heard by a jury, which would decide whether the County took reasonable care to detect and eliminate the harassment and whether the employee had acted reasonably in not availing herself of the County’s anti-harassment protections.

The employee terminated for sexual harassment had been reprimanded twice previously with no notation made in his personnel file. Similar encounters by other workers came under scrutiny before he was terminated. However, Minarsky worked with him alone and had endured sexual harassment for four years.

Being proactive about dealing with sexual harassment and conducting a thorough investigation can often help employers avoid situations like these.

Our attorneys at Stephen Hans & Associates are glad to discuss employment issues and help business owners create discrimination-free work environments.

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What Can Restaurant Owners Do to Reduce Sexual Harassment?

Guidelines for Dealing with Sexual Harassment as a Restaurant Owner

sex harassmentRestaurant owners who allow sexual harassment to exist in the workplace put themselves at risk for complaints and lawsuits. It is wise to understand what actions you can take to eliminate sexual harassment and avoid liability.

The Harvard Business Review (HBR) pointed out that Pizza Hut became liable in the Lockard v. Pizza Hut case because the franchisee ignored corporate policy that required managers to inform a customer to stop harassing their employees. It was their policy to require that customers leave when they failed to heed the manager’s warning. The harassment case resulted in the franchisee paying the employee approximately $38,000 in damages.

What Actions Can Restaurant Owners Take?

To prevent sexual harassment in the workplace, restaurant owners can take the following measures:

  • Devise and enforce anti-harassment polices
  • Establish procedures for employees to file complaints
  • Establish procedures for managers to address complaints regularly and fairly
  • Establish a procedure for employees to report managers to a Human Resources department when being harassed by a manager
  • Use the “secret shoppers” model and interview employees about instances of sexual harassment
  • Require managers to complete sexual harassment training
  • Train managers to recognize the various types of sexual harassment and ensure they understand the legal measures necessary to keep the workplace free of sexual harassment
  • Train employees in bystander intervention training so witnesses know how to recognize and deal with sexual harassment and can disrupt it
  • Train managers how to deal with harassing customers, which includes assigning the employee to a different table, informing the customer that the harassment will not be tolerated, and asking customers to leave when they do not comply.
  • Make it restaurant policy not to serve customers who sexually harass employees. Employees can apply the policy in the same way that they can refuse to serve intoxicated or threatening customers.

Our attorneys at Stephen Hans & Associates are glad to discuss employment issues and help business owners create discrimination free work environments.





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