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Posts Tagged ‘Congress’

Congress Steps Into Tip-Pooling Fight

Posted on: March 23rd, 2018

By: Timothy J. Holdsworth

We wrote previously about the background on the tip-pooling regulations and the DOL’s Notice of Proposed Rulemaking (“NPR”) that would allow tip-pooling arrangements that include employees who do not regularly and customarily receive tips under the Fair Labor Standards Act (“FLSA”). The DOL received a considerable number of comments on the NPR, some of which worried that the NPR would allow employers to keep their workers’ tips.

Buried in the spending bill Congress passed (pages 2025-2027 if you are dying to read it) is a rider that will affect the current U.S. Department of Labor (“DOL”) laws on tips. The bill proposes language that prohibits an employer, including managers and supervisors, from keeping tips received by employees. This prohibition would apply regardless of whether the employer takes the tip credit. The rider also would make employers liable to employees for any tips unlawfully kept by the employer.

If the bill is signed by President Trump, these may substantially affect any tip-pooling arrangements employers planned to enact under the NPR. It is also unclear if the DOL may try to revise the NPR in any way.

The provision would also subject employers to new liability under the FLSA. Just last year, the Eleventh Circuit (Alabama, Florida, and Georgia) in Malivuk v. Ameripark, LLC held that the FLSA does not authorize an employee to sue her employer solely for an employer allegedly withholding her tips when the employee does not allege that she received less than the minimum wage or less than what she was entitled to for overtime work. The rider creates a new cause of action solely for withheld tips.

If you have any questions about what these potential changes may mean for your business or would like more information on navigating wage and hour laws, please contact Tim Holdsworth at [email protected].

Will Innocent Sellers Catch a Break?

Posted on: January 12th, 2018

By: Jeremy W. Rogers

In a products liability case, any party along the line of distribution, from the design and manufacture, all the way down to the seller, may be held liable to a party injured from use of a defective product.  While it is easy to understand holding an entity liable for issues with the design or manufacture of the product, it can be less so with regard to a distributor or seller of the product. Under strict product liability, these entities are held liable because, the argument goes, it is more fair for an entity that places a defective product in the stream of commerce to bear the financial burden of an injury than an innocent consumer. But is that “fair” to an innocent seller or distributor of the product who committed no active negligence?  There are those in Congress and in some states that believe it is not.

In 2007, the Innocent Sellers Fairness Act was introduced into the House of Representatives.  That bill would make it so no seller of any product can be held liable for personal injury, monetary loss, or damage to property unless it can be proven that the seller was actively involved in some negligent act, such as manufacture, design, or installation.  Without proof of such active participation in a negligent act, the seller is, arguably, “innocent.” While the bill was never passed into law, several states have passed similar laws, including Colorado, Delaware, Kansas, Kentucky, Maryland, Minnesota, Mississippi, Missouri, New Jersey, North Carolina, North Dakota, Tennessee, and Washington. Unfortunately, Florida is not one of those states.

However, for those states that have not passed their own law, like Florida, those who support this premise on a national scale have not given up. The bill was re-introduced again in 2015.  Then, in February 2017, it was once again introduced.  Currently, the bill has not made it out of committee, but has been referred to subcommittee. Given the length of time it has been in committee, it does not appear the Innocent Sellers Fairness Act has much opportunity to be passed into law in the near future.  However, given the current makeup of Congress and the business friendly administration, one has to believe that the chances of seeing the bill come up again are good.

If you have any questions or would like more information, please contact Jeremy Rogers at [email protected].