By law, employers are required to pay employees a minimum hourly wage. The amount per hour varies by state though federal law requires that employers pay covered employees no less than $7.25/hr. The Fair Labor Standards Act (“FLSA”) is the law that contains this requirement. Maryland has a similar law. There are certain employees however, who are not required to be paid the minimum wage by their employers under the FLSA. One category of these employees is “tipped employees” who regularly receive more than $30.00 a month in tips. Employers may pay these employees less than the minimum wage so long as they notify these employees that they are taking a tip credit. This allowance is made in part because the presumption is that through tips and/or an hourly wage paid by an employer that the employee is still making a minimum wage. A tip credit refers to the amount of money an employer need not pay an employee because the employee has received that amount in tips. Employers may also require these employees to “pool” or share tips so long as the involved employees “customarily and regularly” receive tips. Employers are not allowed in the pool. Giuffre v. Marys Lake Lodge, LLC, 2012 U.S. Dist. LEXIS 140506, (D. Colo. Sept. 28, 2012) is a recent case in which these issues arose. In the case, an employee sued because he felt that he should not have to give a portion of his tips to another employee called an “expeditor”. He argued that this should not have been required because the expeditor was most like a “back of the house” employee (cook and or dishwasher) and not a “front of the house employee” (a server or bartender). This was an important point because the law only allows employers to require that tipped employees share their tips with other employees who “customarily and regularly” receive tips. The law is clear that waitstaff cannot be required to share tips with cooks, dishwashers, and other kitchen staff. The law is also clear though they may be required to share tips with other servers, bartenders, or “front of the house” staff. Therefore, the court felt it need decide whether or not an expeditor is a “front of the house” or “back of the house” employee for purposes of tip sharing arrangements. Despite a factual dispute regarding the nature of the expeditor’s role in the restaurant, the court ultimately sided with the employer, saying that because the expeditor never stood in the kitchen, was not allowed “behind the line” where the kitchen staff cooked, and allegedly checked in with customers about their food, they were more like “front of the house” staff and servers could therefore, be required to share a portion of their tips with these employees. In making this decision the court seemed to ignore the language of the law itself which states that employees in tip pools must be those who “customarily and regularly” receive tips. There was no inquiry by the court into whether expeditors “customarily” receive tips. Notably, the website businessdictionary.com defines expeditor: “In the food service industry, someone who works in a restaurant's kitchen and keeps the orders organized.” Had the court looked to custom, it may have found that as this particular definition indicates, that an expeditor is typically “someone who works in the restaurant kitchen” and perhaps would have at least allowed the question to survive a motion for summary judgment. It will be interesting to see how and whether similar cases are brought in other circuits and whether they will be treated similarly by other judges.
