Reich in Restaurant Hospitality: Tip Credit Violation Suits on the Rise

Allen Z. Reich, professor in NAU-The W. A. Franke College of Business' School of Hotel and Restaurant Management, had an article published in Restaurant Hospitality titled “Tip Credit Violation Suits on the Rise.” As an expert witness for restaurant-related lawsuits, Reich offers insight into the violation of the tip credit for non-tip producing work. Reich also has served as an expert witness for topics ranging from concept feasibility to murder.

Full article HERE


In my work as an expert witness for restaurant-related lawsuits, I have noticed that one class of suit is becoming more common: violations of the tip credit for non-tip-producing work. (Note: For those of you that are not familiar with the tip credit law, it allows restaurant operators to pay servers less than the legal minimum wage as long as the total of this lower wage and their tips is equal to or more than the legal minimum wage.)

For this particular portion of the law, operators are allowed to have servers spend up to 20 percent of their workweek on non-tip producing work that is directly related to their server responsibilities. Unfortunately, many restaurant operators do not know this law exists and often those that do know about it, try to ignore it. As a result, some of these operators are getting sued. Related to this topic is the fact that some operators try to have servers perform other tasks, such as maintenance and kitchen prep work using the tip credit. Under this law, this is referred to as dual jobs, which require separate payroll record keeping and at least the full minimum wage.

The article had over 3,300 views in its first two weeks.

More on Reich HERE

Categories: allen z. reich 2016 spring 2016 faculty allen reich restaurant hospitality tip credit violation suits on the rise