New Restaurant Wage Law Codifies “80/20 Rule” for Tipped Employees
Connecticut has enacted compromise legislation that attempts to clarify how restaurants and other hospitality industry employers must pay workers who receive tips in customer service jobs that also require untipped work. The new law, Public Act 19-1, directs the state’s Labor Commissioner to adopt regulations codifying the so-called “80/20 rule” and to conduct random wage and hour audits of restaurants to ensure wage and hour compliance. It also restricts the right of employees to bring future class actions against restaurants for alleged violation of wage rules. It is not entirely clear when the regulation imposing the 80/20 rule will become effective in Connecticut. The Labor Department is expected to post its intent to adopt the proposed regulation on April 1, 2020, but the final regulation will not become effective until after a comment and hearing process, review by the state attorney general, and approval by the Legislative Regulation Review Committee.
What are the details?
- The job must be one in which tips have customarily constituted part of the employee’s remuneration and the employee must be made aware of this when hired;
- The amount of gratuities claimed by the employer as “tip credit” toward the state minimum wage must be recorded as a separate item in the employee’s wage record on a weekly basis; and
- The employer must have and maintain substantial evidence, such as a statement signed by the employee that the amount of tips claimed was in fact received by the employee.
What do employers need to do?
Employers should make every effort to comply with the specific requirements of Section 31-62-E4 until the new regulation actually becomes effective.