Federal Government Alters Tip Pooling Law, New York Law Remains Unchanged

Earlier this week the U.S. Department of Labor (DOL) announced that they have proposed new regulations regarding the legality of tip pooling, however these proposed changes would not immediately affect the laws here in New York.

The proposed federal changes would do away with the 80/20 rule when it comes to determining who would be eligible to receive tips, and allow more staff members to be part of a tip pool if the restaurant does not take a tip credit. In announcing the proposals, DOL noted that the suggested changes would not change the tip pooling regulations for restaurants that take a tip credit—or count servers’ wages as a portion of the minimum wage their servers, bartenders or other customarily tipped workers are due by law. In those instances, only the tipped employees can participate in the pool.

While this may be good news for restaurants in other parts of the United States, the NYS Restaurant Association would like to emphasize that, at least for the time being, this does not change anything here in New York. The NYS Department of Labor still has laws on the books that strictly prohibit non-tipped employees from participating in a tip pool and that the 80/20 rule will remain in effect. If this change is adopted, it does provide an avenue for the Association’s Government Affairs team to encourage the State to make the needed changes to match federal law on this important issue.

If you have any questions on this issue please reach out to our Government Affairs team and we will provide clarification.

NYSRA Participates in Roundtable on NYC Paid Vacation Proposal

This Monday, the office of Public Advocate Jumaane Williams hosted a roundtable to discuss the proposed paid vacation mandate. NYSRA joined several other businesses and trade groups to share our key concerns about how this proposal would impact our industries. NYSRA stressed the significant cost burden of both paying for vacation time and paying for replacement workers, which is especially relevant in the labor intensive restaurant industry. We proposed that if the City chooses to move forward with this mandate, they should do their part by funding and administering this benefit. We also discussed the operational burdens related to scheduling, the risk of last-minute call outs, and call outs during busy days/seasons for restaurants.

While we are pleased to have the chance to directly offer feedback on this proposal, we cannot say at this point what changes may be made to the legislation. We will keep you updated with any developments.
NYSRA Compliance Hotline
833.682.6411 | advocate@nysra.org