On Dec. 22, 2020, the U.S. Department of Labor (DOL) announced a final rule to amend employee tip regulations under the Fair Labor Standards Act (FLSA). The final rule will become effective 60 days after its publication in the Federal Register.
- Tip Pooling – The FLSA allows employers to collect all the tips employees receive into a common employee tip pool, then redistribute these tips among employees in an equitable manner.
- The Final Rule – This new final rule prohibits employers from keeping their employees’ tips and specifically prohibits managers and supervisors from keeping any portion of employee tips, including tips from a tip pool. In addition, the rule limits an employer’s ability to implement mandatory tip pools that include non-tipped employees and incorporates a new recordkeeping requirement for employers that do not take a tip credit but collect employees’ tips to operate a mandatory tip pool. Finally, the new rule also incorporates new civil monetary penalties, codifies recent DOL guidance on how to compensate a tipped employee who performs non-tipped duties at work and harmonizes FLSA requirements with Executive Order 13658 (Establishing a Minimum Wage for Contractors).
New data
Unemployment scams are on the rise across the country, with organizations like the Better Business Bureau of Central Illinois reporting that this type of fraud has been on the increase in recent months. Over 200,000 Illinoisans have been targeted for such fraud, and Congressman Rodney Davis (R-IL) himself was a victim, with scammers filing for unemployment benefits under his name.
On January 1, provisions for COVID-related sick leave under the Families First Coronavirus Response Act will expire. These provisions were created to help buffer the economic pain felt by people who either tested positive for coronavirus or may have come in contact with someone who tested positive for coronavirus, or for parents who needed to provide childcare in cases where daycares or schools were shut down due to virus exposure. But, in just two weeks, these protections will end.
