Arkansas Minimum Wage to Increase to $9.25 per hour Effective January 1, 2019
On November 6, 2018 voters passed Arkansas Issue 5 by an overwhelming margin; nearly 7 in 10 voters said yes. Issue 5 raises the minimum wage in Arkansas starting at the beginning of the year. Currently, the minimum wage is $8.50; on Jan.1, 2019, it will go up to $9.25. In 2020, it goes up to $10 an hour, and in 2021 the minimum wage will rest at $11. For tipped employees, such as most waiters and bartenders, the base $2.63 per hour will not change. However, if a tipped employee’s tips don’t get the employee’s pay rate up to minimum wage, the employer will have to cover the difference.
The United States Department of Labor (USDOL) issued four opinion letters today in which it construed issues arising under the federal Fair Labor Standards Act (“FLSA”). The most significant of these letters, FLSA2018-27, is one that addresses the Section 3(m) tip credit which employers may take for certain types of employees under certain circumstances. FLSA2018-27 is an important development that appears to signal the impending demise of the much-maligned, and legally-suspect, “20% Rule” that has caused problems for many employers of tipped employees, particularly in the restaurant industry.
The letter begins by providing an overview of the circumstances allowing for proper application of the “tip credit.” For example, the letter examines the “Dual Jobs” regulation – 29 C.F.R. § 531.56 – which recognizes that in some situations, an employee works for an employer in two distinct jobs, i.e. as a server and a maintenance worker, and states that the tip credit may only be taken for the hours worked in the tipped job (the server job). The same regulation then distinguishes that “dual jobs” scenario from the scenario in which a tipped employee works in a single job with various duties.
“Dual Jobs” Regulation Addresses That Scenario
In a misguided attempt to help delineate the “dual jobs” scenario from the “related duties” scenario, USDOL previously introduced the “20% Rule” in its internal Field Operations Handbook (FOH), an enforcement manual intended to assist agents in their investigations. The FOH provision stated that tipped employees could spend no more than 20% of their work time performing “related duties,” – i.e. making coffee or cleaning tables – without losing the tip credit for the time spent performing those duties. Notably, USDOL never provided an explanation for how it derived the 20% limitation and there is no basis for the limitation in the FLSA itself.
Recognizing that its creation has not helped and instead has led to conflicting court decisions and “confusion,” USDOL has reconsidered its stance. USDOL now states that it does not “place a limitation on the amount of duties related to a tip-producing occupation that may be performed, so long as they are performed contemporaneously with direct customer-service duties and all other requirements of the Act are met.” USDOL also states that it will be revising the relevant section of the FOH in the near future.
In the interim, to help employers determine which duties are “related” to a tip-producing occupation, USDOL says that it will rely on those duties mentioned in the “dual jobs” regulation andthose in the Occupational Information Network (“O*Net”). If a duty is listed in O*Net as being “core” or “supplemental” for a tip-producing occupation, USDOL will consider the duty to be a “related” duty. For example, “cleaning tables,” “rolling silverware,” and “garnishing dishes” are each listed as being either “core” or “supplemental” duties to the “Waiter or Waitress” occupation. Therefore, according to USDOL, there is no limitation on the amount of time that a waitress can spend performing such duties. According to UDSOL, the one caveat is that such “related” duties must be performed “contemporaneously with direct customer-service duties.”
The Bottom Line
This is welcome news for employers of tipped-employees. The 20% Rule was an arbitrary creation that burdened employers with impractical time-keeping requirements and resulted in numerous lawsuits. Of course it remains to be seen exactly how USDOL will revise the relevant section of the FOH. And as we have mentioned previously, there is pending litigation that may affect this issue. But today’s opinion letter represents progress towards a more commonsense, reasonable application of the FLSA.
Service animals enrich the lives of many disabled Americans by performing vital tasks that increase their owners’ safety, mobility and independence. These animals are not a luxury, but a necessity. By denying a disabled person with a service animal access to your business, you’re exposing yourself to lawsuits and serious penalties. So please join us in welcoming disabled guests and their service animals into your business. It’s the law. And it’s the right thing to do.
“We Welcome Service Animals” is a national campaign created by the California Hotel & Lodging Association Educational Foundation and made possible by funding from the American Hotel & Lodging Foundation and the American Express Foundation to teach people in the hospitality industry and law enforcement how to improve service to disabled guests who depend on service animals for assistance. Under the Americans with Disabilities Act (ADA), hotels, motels and restaurants are required to treat disabled customers with service animals like all other guests, providing them with the same service and access to all areas where other guests are allowed. Violating the ADA can lead to serious penalties and costly lawsuits. Also denying access to disabled people with service animals is a crime in every state.
Congress passed the Americans with Disabilities Act (ADA) in 1990 to prevent discrimination against persons with disabilities. Among other things, the law guarantees all disabled persons the legal right to be accompanied by a service animal in all areas open to the general public. Failure to comply with the ADA exposes you and your business to lawsuits and serious federal penalties. Other state and local laws against discrimination may also exist in your area.
What is a Service Animal?
Federal law defines a service animal as any guide dog, signal dog or other animal trained to perform tasks for an individual with a disability. While most service animals are dogs, other animals, such as miniature horses, are sometimes used. The potentially life-saving tasks they perform may include:
guiding individuals who are blind or who have impaired vision
alerting individuals who are deaf or hearing impaired to intruders or to sounds, such as fire alarms, telephones and door bells
pulling a wheelchair
fetching dropped items
providing minimal protection or rescue work
You may not always see a service animal performing these tasks — but they’re always on the job, working to make life safer and more rewarding for their owners. Service animals can often be identified by special harnesses or colorful vests they sometimes wear — but these items are not required by law. So if you are uncertain whether an animal is a service animal, simply ask its owner.
Make All Your Guests Feel Welcome
Under the Americans with Disabilities Act:
You must allow service animals in your hotel or restaurant — even if you have a “no pets” policy or a health code that prohibits animals in restaurants. Service animals are not pets. The ADA pre-empts health codes on this issue.
You may not ask disabled guests to show proof of disability — even if the disability is not readily apparent to you or ask for proof that their animals are “certified” to provide assistance; this is true even if state or local laws provide to the contrary. However, you may ask what service the animal provides.
How can I tell if an animal is really a service animal?
When it is not obvious what service a dog (or miniature horse) provides, only limited inquiries are allowed. Staff may ask two questions: (1) Is the dog a service animal required because of a disability? (2) What work or task has the dog been trained to perform?
Staff cannot ask about the person’s disability, require medical documentation, require a special identification
card or training documentation for the dog, or ask that the dog demonstrate its ability to perform the work or
You may not restrict disabled guests and their service animals to certain areas — such as smoking floors, “pet rooms” or restaurant smoking sections. They are allowed in all guest rooms, dining rooms and buffets, swimming pools, exercise rooms and any other place guests are normally allowed.
You may not charge an extra fee or cleaning deposit for service animals at check-in. However, like any other guests, those with service animals are still responsible for any damage caused by them or their animal.
You may eject a service animal that engages in excessive or prolonged barking, or is, eating food off tables, being aggressive or threatening other guests or employees — but this is highly unlikely.
You should not touch disabled persons or their service animals without permission — it’s rude and can jeopardize the safety of both.
You should not pet, feed or distract a service animal in any way. Remember, they’re not pets — they’re working.
Ask disabled guests if they need assistance — don’t assume they do.
Remember that service animals have needs too — so try to offer a safe, nearby area where they can be walked to relieve themselves.
For more information about our “We Welcome Service Animals” program, or please contact Montine McNulty at 501-376-2323 by phone or by e-mail . For more information on the Americans with Disabilities Act, please contact the Department of Justice via the telephone numbers or web site below.
ADA Information Line — Telephone: 1-800-514-0301 (Voice)
ADA Information Line — Telephone: 1-800-514-0301 (TTY)
ADA Homepage: http://www.ada.gov/