Understanding Wage Violations for Tipped Employees
Tipped employees in the restaurant industry often perform side work, such as rolling silverware, setting up tables, or cleaning. While these tasks are necessary, federal law limits how much side work a tipped employee can perform without being paid the full minimum wage.
Previously, many lawsuits focused on the 30-minute continuous side work rule, which stated that tipped employees must be paid full minimum wage if they spent more than 30 continuous minutes performing non-tipped duties. While this rule still applies, the more critical standard today is the 80/20 rule, which has been the law of the land for decades.
Think you might be underpaid? Call us today at (800) 483-0998 for a free wage evaluation!
The 80/20 Rule: What Employers Don’t Want You to Know
Under federal law, tipped employees cannot spend more than 20% of their total work week on non-tipped duties while still being paid at a reduced tipped wage. If they exceed this threshold, the employer must pay them the full federal or state minimum wage (whichever is higher) for that time.
💡 Did you know? If you’re spending more than 20% of your workweek on side tasks, you could be owed unpaid wages. Contact us at (800) 483-0998 to learn more!
Example Breakdown:
- A server works 40 hours per week.
- 20% of their time per week is spent on side work.
- If they perform more than 8 hours of side work in a week, they must be paid the full minimum wage for the excess hours.
What does ‘full minimum wage’ mean? Most tipped employees receive a reduced hourly rate because employers claim a tip credit to meet minimum wage requirements. However, if you perform excessive side work beyond the 20% limit, the employer must pay you the regular minimum wage for all non-tipped hours, which is higher than the tipped minimum wage. This means that instead of earning the lower tipped wage (e.g., $2.13 per hour under federal law), you are entitled to the full federal or state minimum wage.
How Does This Affect You?
If your employer regularly requires you to perform excessive side work, they may be violating wage laws.
Some common violations include:
- Being required to clean, set up, or close down for extended periods without proper pay.
- Performing side work before or after shifts without tracking hours separately.
- Not receiving a breakdown of tipped vs. non-tipped work on pay stubs.
If you think your employer is breaking the law, don’t wait. Call us today at (800) 483-0998 for a free consultation!
Other Wage Violations Restaurant Employees May Face
In addition to excessive side work, restaurant employees frequently experience other forms of wage theft, including:
- Improper Tip Pooling: Employers sometimes require tipped employees to share their tips with non-tipped workers, such as cooks or dishwashers. However, employees cannot be forced to share their tips with managers, supervisors, cooks, dishwashers, or other non-tipped staff.
- Failure to Pay Minimum Wage: If your tips plus hourly rate do not meet federal or state minimum wage and your employer fails to cover the difference, this is a wage violation. Employers must also ensure that deductions for broken dishes or customer walkouts do not bring an employee’s wage below the minimum.
- Unpaid Overtime: Many restaurant employees work more than 40 hours per week and are entitled to overtime pay. Employers who fail to pay time-and-a-half for overtime hours are violating wage laws.
- Off-the-Clock Work: If you are asked to set up, clean, or perform duties before clocking in or after clocking out, your employer may be committing wage theft.
- Tip Credit Notice Violations: Employers using the tip credit must inform employees of their rights. If an employer does not properly notify you or assigns too much side work, they may lose the right to claim the tip credit, meaning you are entitled to full minimum wage.
- Illegal Deductions: Employers cannot legally deduct wages for uniform costs, customer walkouts, or restaurant losses. If your paycheck is being reduced unfairly, you may be able to recover lost wages.
- Misclassification of Employees: If your employer misclassifies you as an independent contractor or exempt employee to avoid paying overtime or benefits, you could be owed back pay and additional compensation.
Think any of these apply to you? Speak with an experienced wage law attorney today at (800) 483-0998!
What Should You Do If You Think You’re Underpaid?
If you believe your employer is violating the 80/20 rule or any other wage laws, you may be entitled to unpaid wages. Our firm specializes in wage and hour violations, and we can help you determine if you have a case.
Don’t miss out on the wages you’ve earned! Contact us now at (800) 483-0998 to discuss your rights.
