- Tip pooling agreements are presumed to be valid under FLSA;
- FLSA requires employers to pay their employees a minimum wage, but this may include a partial tip credit; and
- FLSA does not prevent employers from including in a tip pool employees who do not customarily receive tips.
Wednesday, February 24, 2010
Ninth Circuit Issues FLSA Tip Pooling Case
In Cumbie v. Woody Woo, Inc., --- F.3d ----, 2010 WL 610603 (9th Cir. (Or) February 23, 2010), the Ninth Circuit held that a restaurant that pays its wait staff cash wages in excess of the FLSA minimum wage but requires them to participate in a tip pool that redistributes some of their tips to the kitchen staff does not violate the Fair Labor Standards Act (FLSA). The Court explained that:
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Section 203(m) clearly prohibits both judges and the U.S. Department of Labor from construing it in a manner where the pooling of tips among employees who customarily and regularly received tips is prohibited.
ReplyDeleteThe pooling of tips, as refederenced in section 203(m) is defined under CFR 531.54 as where the waiters give a portion of "their" tip to the busboy.
What Section 203(m) in conjunction with CFR 531.54 clarifies is that the courts, the U.S. Department of Labor or any one else in a position to construe federal laws, is prohibited from constuing section 203(m) to where waiters are unalbe to give a portion of "thier" tips to the busboy.
The Cumbie ruling is a direct violation of Section 203(m).
Here are some quotes from the Cumbie ruling which clearly substantiate the fact that the Ninth Circuit has misconstrued section 203(m) to the point where waiters, such as Mistie Cumbie, are unable to give part of her tips to the busboy.
Congress didn't say that tips are always the property of the employee. In fact..
It's seems to me that tips are the property of the employee in some instances but in other instances where we have an employment agreement suggesting that tips become the property of the employer, now tips are not the property of the employees at all, and now we have an agreement that says they are not the property of the employee.
Now, How can the waiters who work for Mr. Woo give part of "their" tips to the busboy when the Ninth Circuit has construed section 203(m) as suggesting that in this case the waiter's tips belong to Mr. Woo.
While 203(m) in conjunction with CFR 531.52 explain that no court shall interpret section 203(m) to where waiters are prohibited from giving part of "their" tips to the busboys, the Ninth Circuit's ruling prohibits the waiters at Woody Woos from considering the tips "their" tips. Thus the waiters at Woody Woos are prohibited from giving part of "their" tips to the busboy and thus the pooling of tips, as referenced under 203(m), is unlawfully prohibited.
Here are two more lies that obviously need exposed.
ReplyDelete"Tip pooling agreements are presumed to be valid under FLSA."
Not all tip pooling agreements are presumed to be valid under FLSA.
While section 203(m) explains that nothing in this section shall be construed to prohibit the pooling of tips among employees who customarily and regularly receive tips, CFR 531.52 clarifies that such employees must be receiving tips as money belonging to them which they may use as they choose free of any control of the employer.
A tip pool, such as Mr. Woo's does, not qualify as the pooling of tips among employees who are receiving tips free of any control of the employer. Thus Woody Woo's tip pool cannot be presumed to be valid under the FLSA.
"FLSA does not prevent employers from including in a tip pool employees who do not customarily receive tips"
Again section 203(m) explains that the pooling of tips which cannot e prohibited is that which is among employees as defined under CFR 531.52. Besides CFR 531.52 language which clearly explains that only tip pools allowed under federal law are tip pools including employees who are receiving tips free of any control of the employer, CFR 531.56 also contradicts such an idea.
CFR 531.56 clearly states that individual reciepts are controlling, An employee must himself customarily and regularly receive more than $20 a month in tips in order to qualify as a tipped employee.
Not only do both CFR 531.52 and CFR 531.56 contradict the idea that the FLSA does not prevent employers from including in a tip pool employees who do not customarily receive tips, Section 203(m) contradicts such an idea.
Section 203(m)clearly instructs that "The additional amount on account of tips may not exceed the value of the tips actually received by an employee".
In the case of Woody Woo. Woody Woo is paying kitchen workers an additional amount on account of tips which unlawfully exceeds the value of tips actually received by such employees.
Why do we have judges lying and violating federal law?
ReplyDeleteI think it's called corruption folks.
Now, let me point out one insightful and incriminating fact.
The National Restaurant Association is one of the biggist lobbyist in this country. They shell out millions in an effort to unsure that restaurants get preferential treatment.
Corruption is becoming so blatant in this country that even a simple joe like myself can see what's going on.
It's time to expose this blatant corruption.