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Attorney General Stein Defends the Rights of Tipped Workers

For Immediate Release:
Tuesday, December 10, 2019

(RALEIGH) Attorney General Josh Stein today opposed the Department of Labor’s proposed cutback of protections for tipped workers. The DOL’s proposal would eliminate the 80/20 Rule, which protects tipped workers from being paid lower wages.

“Tipped employees work hard for their wages and deserve to be paid fairly,” said Attorney General Josh Stein. “The Department of Labor’s proposal would make it harder for restaurant servers, bartenders, and other workers to be paid what they have earned.”

Under the Fair Labor Standards Act, employers are required to pay their employees the federal minimum wage and can do so in one of two ways. First, employers can pay employees the full federal minimum wage, currently $7.25 per hour. Or, they can pay employees a lower cash wage and make up the remaining difference through a tip credit, a credit of the tips that employees earn.

For decades, tipped workers have been protected by the 80/20 Rule. The rule ensures that any worker being paid using the tip credit method must spend at least 80 percent of their work time doing tipped work, and no more than 20 percent of their work time doing non-tipped work.

In their comment letter, the attorneys general explain that the proposed rule would further erode the already low wages of tipped workers, leaving them vulnerable to wage theft. The coalition further argues that the proposal is contrary to the purpose of the Fair Labor Standards Act to protect workers and that the DOL did not abide by the Administrative Procedure Act by failing to examine the proposal’s impact on wages and increased reliance on social safety net programs.

Attorney General Stein was joined in sending this comment letter by the Attorneys General of California, Delaware, Hawaii, Iowa, Maine, Maryland, Michigan, Nevada, New Jersey, New York, Oregon, Rhode Island, Vermont, Washington, and the District of Columbia.

A copy of the letter is available here.

Laura Brewer (919) 716-6484


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