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Restaurant Labor Laws

Restaurant Labor Laws

Last updated on 7/30/2018

In order to protect workers and employers, there are a series of employment and labor laws all restaurant owners must abide by. These laws, set by the United States Department of Labor as well as state and local governments, are designed to provide a safe, healthy, and fair workplace for employees. In this guide, we outline some of these key laws including policies on wages and tipping practices, the employment of minors, and occupational health and safety.

Restaurant Wages and the Fair Labor Standards Act

Many restaurant labor laws come from the Fair Labor Standards Act (FLSA), an act originally signed by Roosevelt in 1938, that explains the standards set for full-time and part-time workers in the private sector and in Federal, State, and local governments. The FLSA establishes minimum wage, overtime pay, recordkeeping, and child labor standards for businesses in the foodservice industry. Below are the FLSA requirements:

Young Cashier Employee
  • Minimum revenue for subjection: An establishment's annual gross sales must total at least $500,000 to be subject to FLSA rules and regulations
  • Minimum wage requirement: Entitles non-exempt workers to federal minimum wage of $7.25 per hour unless an individual state's law requires a higher wage
  • Deductions and minimum wage: Deductions for cash shortages, required uniforms, or customer walk-outs are illegal if they drop the employee's wage below the minimum wage
  • Tips and minimum wage: Tips may be considered part of wages, but the employer has to pay no less than $2.13 an hour and also make sure that the tips and wages add up to at least the minimum wage
  • Overtime: Employees who work overtime are to be paid one and one-half times their regular rate of pay for each hour over 40 hours per week
  • Overtime and tips: Tipped employees who work overtime are to be paid one and one-half times the applicable minimum wage, not one and one-half times $2.13
  • Youths and minimum wage: Youth employees under the age of 20 may be paid a minimum wage of no less than $4.25 an hour during the first 90 days of their employment

Restaurant Tips and Wages

While the FLSA outlines parameters for legal wage and tipping practices, ensuring that your servers are earning at least minimum wage with tips can sometimes cause bookkeeping complications. Depending on the size of your staff and the volume of your customers, tracking your employees' tips can be a daunting task. If tips are not accurately counted or reported, employers could face fines related to improperly distributed pay.

For this reason, it is important for restaurateurs to carefully consider which pay strategy works best for their establishment. Failure to comply with federal wage laws could result in legal action from employees and potentially cost your business more time and money than a fair wage practice would. For more information on the minimum cash and tipped wage in your state, check out this data from the United States Department of Labor.

Employing Youths or Minors

When scheduling workers under the age of 17, employers have to follow several FLSA guidelines for youth employees. Workers between the ages of 14 and 15 may work outside of school hours in non-hazardous jobs for no more than 3 hours on a school day, 18 hours in a school week, 8 hours on a non-school day, or 40 hours in a non-school week. They also may not work before 7 a.m. or after 7 p.m. except between June 1 and Labor Day, when those hours are extended until 9 p.m.

Hazardous vs. Non-Hazardous Jobs for Minors

Employees who are 16 years old may perform any non-hazardous job for an unlimited amount of hours until they turn 18 and are considered adults. Any employee under the age of 18 is prohibited from performing hazardous job duties. Here are some examples of hazardous and non-hazardous job duties:

Hazardous Non-Hazardous
  • Using bakery equipment
  • Operating meat-processing equipment
  • Operating or maintaining power-driven equipment like slicers, grinders, mixers, etc.
  • Cashier and bagging duties
  • Fruit and vegetable cleaning or prep
  • Dishwashing
  • Light-duty cooking

Texas Department of Labor Poster

The Occupational Safety and Health Act (OSHA)

OSHA was passed in 1970 to create healthier, safer working environments through training, outreach, education, and assistance. OSHA requires that all employers:

  • Provide a hazard communication program for employees
  • Train employees properly to prevent accidents
  • Provide necessary protective equipment
  • Have access to a first aid kit
  • Display posters from the Department of Labor or their state labor department that inform employees of their protections and rights (example seen to the right)

OSHA-Approved State Plans

OSHA also permits states to submit their own safety plans for approval. The following image indicates those states with OSHA-approved plans for private and/or public sector employees.


The Equal Employment Opportunity Commission

This commission reviews cases of discrimination and enforces the federal laws that make it illegal to discriminate against job applicants or employees based on the following:

  • Race, color, religion, sex (including pregnancy), national origin, age (40 or older), disability, or genetic information
  • A complaint about discrimination on an employee's behalf

Laws Enforced by the EEOC

Here are some laws that are enforced by the EEOC that may be relevant to your restaurant workplace.

  • Title VII of the Civil Rights Act of 1964 that outlaws discrimination based on race, color, religion, national origin, or sex. The law also makes it illegal to retaliate against someone for filing a charge, complaining of, or taking part in a lawsuit or investigation of discrimination.
  • Title VII also forbids discrimination based on sexual orientation or gender identity, and these protections apply regardless of state or local laws.
  • The Pregnancy Discrimination Act that outlaws discrimination because of pregnancy, childbirth, or a medical condition related to childbirth.
  • The Equal Pay Act of 1963 that makes it illegal to pay different wages to men and women if they perform equal work in the same workplace.
  • The Age Discrimination in Employment Act of 1967 that protects people 40 and older from discrimination based on age.
  • Title I of the Americans with Disabilities Act of 1990 that makes it illegal to discriminate against a qualified person because of a disability in both the public and private sectors. It also requires employers to reasonably accommodate physical or mental handicaps in their establishments where not doing so would cause undue hardship.
  • Sections 102 and 103 of the Civil Rights Act of 1991 that permits jury trials and monetary damage awards in intentional discrimination cases.
  • Sections 501 and 505 of the Rehabilitation Act of 1973 that makes it illegal to discriminate against a qualified person with a disability in the federal government.
  • The Genetic Information Nondiscrimination Act of 2008 that makes it illegal to discriminate against employees or applicants based on their genetic information that might identify family members, disease information, or disorders and conditions in the family's medical history.

Refer to this guide in order to ensure that you are following all of the necessary labor laws in your restaurant. Failure to uphold these regulations could result in fines or legal action, so restaurateurs must familiarize themselves with these policies in order to run a safe, fair, and legal establishment.

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