Senator Mike Braun (R-Ind.) has introduced legislation to clarify the definition of tipped employee and relieve reporting burdens that are harming the restaurant community. Representative Steve Womack (R-Ark.) introduced the companion legislation in the House.
Braun
“The Biden administration’s confusing compliance rule creates an unnecessary reporting burden for restaurants and servers that are already going through a difficult time due to inflation and rising food costs,” Sen. Braun said. “This legislation will help streamline regulations for tipped employees so that restaurants and their workers can thrive.”
The Tipped Employee Protection Act of 2023 would:
- Amend the FLSA definition of tipped employee to create a more explicit definition of the term by removing interpretive language (customarily and regularly), providing additional clarity and simplicity in categorizing individuals as tipped employees.
- Restrict the ability of judges or the administration to set arbitrary limits or requirements in classifying the hours or duties that a tipped employee performs.
- Preserve the tipped wage and the protection in the FLSA that tipped employees that receive at least the minimum wage between the addition of an employer-paid cash wage of $2.13 and tips – and in many cases much more. If an individual’s tips do not reach the applicable minimum wage under that formula, the employer would still be required to pay any difference.
- Retain the ability of states under the FLSA to set wages higher than the federal statutory minimum, meaning that any state could continue to independently set the wage.
Click here to read the full text of the two-page bill.