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New Connecticut Restaurant Bill Clarifies When Restauraunt Employers Can Rely on the Tip Credit to Meet Minimum Wage Requirements

The Connecticut legislature recently passed a bill that strikes a balance between protecting wages earned by restaurant workers while providing clarity for restaurant owners who may have not had clear standards to follow in deciding how to treat tipped workers. In Connecticut, tipped workers are paid a base wage lower than minimum wage with the understanding that tips make up the difference. The Connecticut tip wage for service workers is $6.38 per hour or $8.23 for bartenders. The minimum wage for non-tipped workers is $11. In the course of a shift, restaurant workers may spend time working for tips, but another period of time working on non-tipped tasks, such as cleaning and food preparation.

Because it is nearly impossible to determine how much time is spent on non-tipped versus tipped work, the Department of Labor advised restaurant owners to comply with an 80/20 rule. Under this rule, a worker is paid as performing tipped work 80% of the time and as performing non tipped work 20% of the time. However, this was just guidance and not written law.

As a result, legislature passed a bill requiring the labor commissioner to work on a new regulation for publication by April 1, 2020 which will clear up any contradiction between the law and the Department of Labor guidance. The passed bill also requires the Department of Labor to audit 75 restaurants per year to ensure compliance.

While there is no defined number of tipped workers in the state that were affected by this discrepancy, as of December 23, 2019, there are 25 active lawsuits by Connecticut servers who allege they were underpaid for their work.  If you are a restaurant owner who is confused about how to treat tipped workers, or are subject to a Department of Labor Wage and Hour Audit, please contact Robert S. Cooper to discuss your questions.

This article was co-authored by legal intern, Alyssa Ferreone. Alyssa is not yet admitted to practice law.

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