Joining several other recent federal court decisions, including a decision invalidating recently promulgated Department of Labor regulations purporting to address the issue, Judge Ted Stewart of the District of Utah has ruled that an employee has no claim for allegedly misappropriated gratuities under the FLSA unless the employer elected to take the tip credit
Tips
Minnesota High Court Rules: Tips Are Wages
As discussed in greater detail here, the Minnesota Supreme Court has ruled that gratuities received by night club employees were “wages” within the meaning of Minnesota’s law prohibiting deductions, and thus an employer violated that law when it required employees to pay for “register shortages . . . walkouts . . . [and] unsigned…
Coyote Ugly Bouncers Proper Tip Pool Participants Due To Customer Interaction
Following a bench trial, Judge Aleta A. Trauger of the Middle District of Tennessee has ruled that bouncers at various Coyote Ugly saloons sufficiently interacted with saloon guests to validate their sharing in the tip pool. Stewart, et al. v. CUS Nashville, LLC, et al., M.D. Tenn., No. 11-cv-00342, 8/8/13.
In Stewart, Plaintiffs…
New York Court of Appeals Issues Starbucks Tip Ruling
In a significant victory for New York employers, the New York Court of Appeals has now held that Starbucks’ tip splitting practices did not violate New York law. In answering the certified questions in In Re Starbucks, the Court held “an employee whose personal service to patrons is a principal or regular part of…
Restaurant Association Defeats Department of Labor, Invalidates 2011 Tip Regulations
In 2010, the Ninth Circuit held in Cumbie v. Woody Woo, Inc., that an employee’s property right to tips attaches under the FLSA only if the employer is taking a tip credit pursuant to 29 U.S.C. § 203(m). In response to this decision the Department of Labor passed widely discussed-regulations which, contrary to the decision…
New York High Court To Hear Oral Argument In Closely Watched Starbucks Appeal
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…
Federal Court in Indiana Dismisses Claims Alleging Work Outside Of “Tipped Occupation” As Contrary To Law And Inadequately Pleaded
In a case defended by Jackson Lewis Wage Hour Practice Group Chair and former Wage and Hour Administrator Paul DeCamp, Judge Theresa Springmann of the Northern District of Indiana on Tuesday dismissed claims brought by a former server employed by an Indiana-based Applebee’s operator alleging the restaurant was not entitled to avail itself of…
New York Judge: Deduction of Full “Seamless Web” Fees from Gratuities Potentially Violates FLSA, New York Law
In a decision sure to attract attention within the New York hospitality industry, Judge Alison J. Nathan of the United States District Court for the Southern District of New York ruled in a case of first impression that deducting the full amount of service fees charged by internet food delivery sites (including popular web…
Florida Federal Court Holds Kitchen Chef Improper Tip Pool Participant
The FLSA regulates tip pool participation by limiting pool participants to employees who are “customarily and regularly tipped” as set forth in DOL guidance and interpreted by the courts. While the role of different positions in the service process (going to the question of whether they are “customarily and regularly” tipped) can be hotly contested, the…
Starbucks Tip Jar Wars Rage On: First Circuit Excludes Shift Supervisors From Massachusetts Tip Jars
The Court of Appeals for the First Circuit has ruled that under Massachusetts’ unique tip statute, shift supervisors cannot participate in the tip jar-based tip pool in Massachusetts locations. Matamoros v. Starbucks Corp., 2012 U.S. App. LEXIS 23185 (1st Cir. Nov. 9, 2012). Several years ago, a California Appeal Court ruled just the opposite…