Procedural Guarantees

National Restaurant Association v. Department of Labor

The outer reaches of a statute are bookends, not blank pages

The Fair Labor Standards Act (FLSA) restricts the tipping practices of companies that  use  tips  as  a  supplement  to  reach  their  federal minimum  wage  obligations—the so-called tip credit. The FLSA forbids companies from requiring tip-earning employees—such as waiters—to share tip money with untipped staff—such as line cooks. The FLSA imposes no such demand on companies that do not use a tip credit. Nonetheless, the Department of Labor issued a regulation requiring all businesses to follow the tip-pooling rule, whether they use the tip credit or not. Restaurants that do not use tip credits sued to invalidate the regulation but the courts upheld it on the theory that the FLSA’s silence on this issue created an ambiguity and the courts would defer to the agency’s interpretation. As amicus curiae, PLF urged the Supreme Court to review this decision.

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