Earlier this month, the Department of Labor (DOL) issued three new opinion letters on tip pooling, nonprofit volunteering and meal periods under the Fair Labor Standards Act (the "Act"). First, on tips, the DOL confirmed that the FLSA prohibits “executive employees” (i.e., managers who qualify as exempt from minimum wage and overtime) from keeping a portion of other employees’ tips – even when the manager is helping out behind the bar.
Next, on volunteers, the DOL explained that paid employees of a nonprofit may perform uncompensated volunteer work only if that work is “not the same type of services” the employee is paid to perform and is “offered freely and without pressure or coercion.” The employer seeking the opinion was a nonprofit organization that breeds, raises and trains service dogs to assist with visual impairments and veterans with PTSD. Certain employees wished to volunteer to serve as “juvenile canine caretakers” in their homes outside of working hours. The DOL reminded the employer that this analysis turns on the specifics of the employees’ roles – the “services” of a veterinarian might not be “the same type” as the canine caretaking because veterinarians might not generally be required to train dogs, while the “services” of a trainer employee might be “of the same type.” As with all things FLSA, the DOL cautioned “employers to exercise caution when engaging employees as volunteers to ensure they are not inadvertently misclassified under the Act,” which “may result in costly ramifications.”
Finally, regarding lunch breaks, the DOL opined that a 60-minute lunch break was entirely uncompensable time, even though employees spent six to 14 minutes of break time walking to and from the designated break area.
