On May 28, 2013, New York’s highest state court, the New York Court of Appeals, will hear oral argument regarding the scope and application of New York Labor Law 196-d and its tip splitting provisions to Starbucks’ tip pooling practices. The court’s analysis of these issues, which came to the court as certified questions from the Second Circuit Court of Appeals, is expected to have industry-wide implications, including guidance regarding what standard applies in determining who is eligible to participate in a tip pool and whether, and to what extent, an employer may exclude otherwise eligible employees from participating in a tip pool. As part of its deliberations, the Court will consider an amicus brief submitted on behalf of the New York State Restaurant Association by Jackson Lewis. A decision by the Court will hopefully provide clarity in this area of the law, as lingering uncertainty has served as a breeding ground for litigation.
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[UPDATE] Yesterday afternoon the Court of Appeals heard oral argument. While the Court did not preview any ruling, it did appear uncomfortable with the viewpoint advocated by counsel for the baristas, namely that any supervisory duties makes one ineligible to participate in a tip pool. The argument ultimately will be archived and available for viewing here. While the impact of the Court’s decision for the New York hospitality economy will be broad, the argument was historic for other reasons, as it marked the first session of argument presided over by newly-appointed Justice Sheila Abdus-Salaam, the first African-American female to serve on the high court.