Frosh Joins Lawsuit Against United States Department of Labor

Attorney General Frosh Joins Federal Lawsuit to Protect Tipped Workers

Case 2:21-cv-00258 Document 1 Filed 01/19/21

BALTIMORE, MD (January 19, 2021) – Maryland Attorney General Brian E. Frosh today joined a multistate coalition in filing a lawsuit to stop the last ditch effort by the Trump Administration to allow employers to withhold tips from their employees. The lawsuit challenges a U.S. Department of Labor (USDOL) rule that unlawfully seeks to remove the limit on non-tipped work a tipped worker may complete and still receive only the tipped minimum wage, $2.13 per hour federally and $3.63 per hour in Maryland.

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The Fair Labor Standards Act (FLSA), the federal law establishing a baseline of critical workplace protections, such as minimum wage and overtime, permits employers to take a credit against their minimum wage obligations for the tips workers receive. For 30 years, USDOL regulations have capped the amount of non-tipped work a tipped worker may do at 20-percent, also referred to the “80/20 rule.” The new rule eliminates that cap, among other provisions. In December, 2019, Attorney General Frosh joined comments to USDOL opposing the proposed rule.

“Thousands of Marylanders rely on tips to pay their bills and feed their families,” said Attorney General Frosh. “COVID-19 has shuttered many businesses that employ tipped workers, virtually eliminating much-needed income. What these hard working people need from the federal government is relief, not a pay cut.”

The coalition asserts that the rule contradicts the text and purpose of the FLSA, and that the USDOL violated the rulemaking process requirements, including failing to analyze the impact the rule would have on tipped workers. In addition, the rule fails to justify its departure from the longstanding 80/20 rule. The states argue that the rule will harm the states by reducing income tax revenue, increasing public benefits expenditures, and imposing administrative costs.

In addition to Maryland, the suit was joined by the attorneys general of Delaware, the District of Columbia, Illinois, Massachusetts, Michigan, New Jersey, New York, and Pennsylvania.

What does this mean for individuals that are employed in restaurants?

December 2019, Attorney General Frosh Joins Comments Defending Rights of Tipped Workers

Image courtesy of cnsmaryland.org

BALTIMORE, MD (December 10, 2019) – Maryland Attorney General Brian E. Frosh today
joined a coalition of 19 attorneys general in submitting a comment letter to the Department of
Labor (DOL) opposing its proposed rescission of protections for tipped workers. Under the Fair
Labor Standards Act, employers are required to pay their employees the federal minimum
wage. For decades, tipped workers have been protected by what is known as the “80/20
Rule.” The rule ensures that any worker being paid $2.83 per hour—due to their employer
utilizing the “tip credit”—spends at least 80 percent of their work time doing tipped work.

Under DOL’s proposal, the “80/20 Rule” would be eliminated and employers would be able to
assign virtually unlimited amounts of non-tipped work – such as cleaning, cooking and other
“back of the house” tasks – while still taking a tip credit and paying workers a lower wage.

living,” said Attorney General Frosh. “We will work to ensure workers get the wages they’ve
rightfully earned and rely on to support their families.”

In their comment letter, the attorneys general state that the proposed rule would further erode the
already low wages of tipped workers and leave them more vulnerable to wage theft. The
coalition further argues that the proposal is contrary to the purpose of the Fair Labor Standards
Act – to protect workers – and that DOL did not abide by the requirements of the Administrative
Procedure Act when it failed to examine the proposal’s impact on wages and increased reliance
on social safety net programs.

Hawaii, Illinois, Iowa, Maine, Massachusetts, Michigan, Nevada, New Jersey, New York, North
Carolina, Oregon, Pennsylvania, Rhode Island, Vermont, Washington, and the District of
Columbia

Article reprint from the press release of the Office of Brian E. Frosh, Attorney General for the State of Maryland

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