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Andrea Ryder, a manager and server at Jimm's Steakhouse & Pub, can't imagine not being paid a fair wage for the work she does outside of serving.
McKenzie Robinson | SBJ
Andrea Ryder, a manager and server at Jimm's Steakhouse & Pub, can't imagine not being paid a fair wage for the work she does outside of serving.

Tipping Point: Side work could result in extra compensation for tipped employees

Posted online

A proposal by the U.S. Department of Labor would reinstate a longstanding policy requiring restaurants to pay tipped workers full minimum wage when spending more than 20% of their time on “side work” – a restaurant term for tasks that don’t generate tips.

Specifically, the proposed rule change, announced July 19, would bring back the 80/20 rule, which was revoked under President Donald Trump’s administration. This rule dictates that when servers spend more than 20% of work time doing side work, the employer must pay them at least minimum wage rather than paying less than minimum while taking advantage of a tip credit.

Nationally, minimum wage is $7.25 per hour, but workers who regularly earn tips can be paid $2.13 per hour by employers. In Missouri, the minimum wage is higher, at $10.30 for regular workers or $5.15 for tipped workers. Restaurants claim a credit against tips earned by those workers whose work regularly includes gratuities, and this allows them to meet the minimum wage requirement. Side work for a restaurant server on a regular shift may include tasks like assembling salads or making a pot of coffee. Sometimes side work can be more involved, however, with tasks like cleaning workstations or setting up dining rooms.

The proposed policy also offers an addition to the rule, a requirement that restaurants pay minimum wage to workers whose side work lasts for at least a consecutive 30 minutes, regardless of the percentage of work time they spend.

The Trump administration’s elimination of the 80/20 rule had been estimated by the Economic Policy Institute, a Washington think-tank that carries out economic research, to cost workers more than $700 million in wages annually. The proposal to reinstate the 80/20 policy is intended to reverse that loss.

Andrea Ryder is one of the managers at Jimm’s Steakhouse & Pub, located at 1935 S. Glenstone Ave. When asked about the reinstatement of the 80/20 and 30-minute rules, she expressed surprise.  “I didn’t even know that wasn’t a thing,” she said.

Ryder said that it has always been the policy at Jimm’s that servers receive at least minimum wage when they are not earning tips by serving customers directly.

“We have never changed that here at Jimm’s,” she said.

Sometimes workers come in early to do various tasks required to open the restaurant, Ryder said, and they are always paid at least minimum wage.

“I definitely think that’s fair,” she said. “If somebody’s here that’s working on a tipped wage and they’re not able to make tips at that time, it’s definitely fair to pay them at least the minimum.”

A mile and a half south of Jimm’s, just off Glenstone Avenue at 1723 E. Battlefield Road, Matt Arnall owns and operates Downing Street Pour House.

Arnall, who has plenty of experience at restaurant work, from wielding the busing tray to working in a corporate office, has no problem with the proposed return to the 80/20 policy.

“I think it’s the way it should be. I don’t see any negatives to it,” he said. “If you’re getting paid to do a job, you shouldn’t have to work outside the bounds of what that job is just because your employer’s trying to save money. I don’t think that’s the right way to treat people.”

At Arnall’s restaurant, the policy of paying a fair wage to servers who are not actively earning tips is already in effect, but he understands this policy is not universal.

“The issue is that there’s a lot of mom-and-pop places out there that will hire servers to serve, and they end up doing dishes, making food – that’s just not what they’re there to do,” Arnall said.

Arnall said it’s reasonable for servers to roll silverware, make tea, clean up after themselves and do whatever they have to do to serve their guests.

“The reason they even have that rule is you’ll find people doing dishes and prepping food, and that’s way outside the bounds of what they should be doing,” he said. “This 80/20 thing is not a hard concept to grasp, but a lot of restaurant guys and gals try to act like it is because they don’t want to follow it.”

Across the state in St. Louis, Missouri Restaurant Association CEO Bob Bonney suggested that there is a little more to the issue.

“If you look at the situation now where restaurants are not able to staff to a level where they can seat all their tables, why would a restaurant have an employee do an excess amount of work that is not serving customers?” he asked.

Reasonableness is a standard that Bonney likes to apply to this issue. He said side work, in the majority of cases, is accepted by tipped employees.

“Neither side had any problem with it. That covers the overwhelming majority of cases today,” he said.

In the current climate, no good restaurateur would try to get by without paying workers a fair wage, according to Bonney.

“You would have to be something less than a stellar restaurant operator to try to take advantage of your people in this environment,” he said.

Bonney figures that if an employer is requiring tipped employees to do an excessive amount of nontip-generating work, that situation is best taken up with the Missouri Department of Labor, which can enforce restaurants’ use of tip credit, or the ability for employers to count their servers’ gratuities toward the minimum wage requirement.

“No restaurant would want to lose the ability to use the tip credit, and few restaurants – extremely few restaurants – would want to have someone leave them because they’re being unfairly treated,” Bonney said.

Bonney acknowledges that every industry has its bad actors, and restaurants are no exception. “The Missouri Restaurant Association never wanted to be a safe harbor and protect someone who wasn’t acting fairly with the law,” he said.

But the 80/20 policy was never a law at all, according to Bonney – it was just language in an internal handbook for the Department of Labor. Codifying it could backfire in some instances, Bonney said.

“If it gets too unreasonable, in my opinion, you’re going to invite a situation where the amount of table service diminishes,” he said. “You’ll place your order at a counter, they’ll call your name, you’ll go pick up your order.”

Bonney said there always will be restaurant customers who enjoy sitting down and being cared for in fine fashion. Likewise, he said there always will be servers who are willing to do the work, often for a very good income.

“I hope it’s in a way that’s reasonable and fair, not only to the employee but to the employer,” he said.

Fair pay and fair treatment have certainly contributed to Ryder’s sense of satisfaction at the steakhouse.

“Jimm is the best employer I’ve ever had when it comes to wages,” she said of Jimm Swafford, the managing partner and namesake of Jimm’s Steakhouse & Pub. “This is an amazing place to work.”

Not every tipped employee shares Ryder’s positive experience with compensation, and for them, the restored Department of Labor rules are intended to spur a change.

Bonney is skeptical of the enforceability of the Biden administration’s rollback of these changes.

“The issue becomes a matter of practicality in its implementation,” he said. “It’s not reasonable for an employer to be required to follow a server around and actually with a stopwatch calculate the minutes and seconds where they do this nontip-generating work. Are you going to start your stopwatch when they open a new packet of coffee, dump the old grounds, pour in the new grounds, press start?”

For both Downing Street Pour House and Jimm’s Steakhouse & Pub, extra work is limited to what servers need to do in order to take care of their customers, according to both Ryder and Arnall. Ryder pointed out that at Jimm’s, the fully compensated preservice setup work occurs before customers are present.

Bonney noted that without a stopwatch, it would be hard for an employer to rebut a worker’s claims in court. The result will be frivolous lawsuits, he predicts.

The proposal is open for public comment until Aug. 23, after which a decision will be made by the Department of Labor.

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