{
    "schema": "amendsignal.record/1",
    "generated_on": "2026-11-04",
    "publisher": {
        "name": "AmendSignal",
        "url": "https://amendsignal.com/"
    },
    "notice": "Coverage is limited, so a missing record does not mean nothing changed. General information, not legal advice. Check the official source. Please cite the record's url.",
    "change": {
        "id": 52,
        "url": "https://amendsignal.com/changes/wage-and-hour-division-withdraws-three-tipped-employee-opinion-letters/",
        "title": "Wage and Hour Division withdraws three tipped employee opinion letters and confirms the 80/20 related-duties guidance no longer reflects its policy",
        "change_type": "guidance",
        "change_type_label": "Field assistance bulletin",
        "status": "guidance_issued",
        "status_label": "Issued as agency guidance",
        "status_statement": "As of our last check on November 2, 2026, this is agency guidance, not a rule. It explains how the agency reads the law and does not create a legal requirement on its own.",
        "significance": "No new requirements",
        "jurisdiction": {
            "code": "US",
            "name": "United States"
        },
        "authority": {
            "name": "Wage and Hour Division",
            "short_name": "WHD"
        },
        "identifiers": [
            {
                "type": "fab_number",
                "label": "Field assistance bulletin",
                "value": "FAB 2026-1"
            }
        ],
        "dates": [
            {
                "type": "publication",
                "label": "Published",
                "value": "2026-10-19",
                "precision": "day"
            }
        ],
        "in_short": {
            "what_changed": "The Wage and Hour Division (WHD) of the Department of Labor withdrew three old opinion letters on tipped employees and confirmed that its 80/20 guidance, which limited time spent on related non-tip-producing duties, no longer reflects its policy. WHD now looks at whether an employee is engaged in a tipped occupation, not at how much time goes to individual tasks.",
            "whos_affected": "Employers that take a tip credit toward the federal minimum wage for tipped employees under the Fair Labor Standards Act (FLSA), most often restaurants and hotels.",
            "what_to_do": "This bulletin creates no new duties for employers. Existing FLSA tip credit rules still apply, including paying the full minimum wage for hours worked in a non-tipped occupation; consider reviewing any tip credit policies built on the withdrawn letters or on a time-limit test."
        },
        "summary": "In Field Assistance Bulletin No. 2026-1, the Department of Labor's Wage and Hour Division (WHD) withdrew three opinion letters from 1979, 1980 and 1985 on when employers may take a tip credit for time tipped employees spend on related, non-tip-producing duties. It confirms that the 80/20 guidance, removed from its Field Operations Handbook in January 2025, and any guidance setting time limits on duties within a tipped occupation no longer reflect its policy. The bulletin is enforcement guidance and creates no new legal requirement.",
        "business_functions": {
            "state": "limited",
            "functions": [
                {
                    "slug": "human-resources",
                    "name": "Human resources"
                },
                {
                    "slug": "payroll",
                    "name": "Payroll"
                },
                {
                    "slug": "legal-and-compliance",
                    "name": "Legal and compliance"
                }
            ]
        },
        "added_on": "2026-11-03",
        "updated_on": null,
        "updates_in_progress": null,
        "last_checked": "2026-11-02",
        "record_url": "https://amendsignal.com/changes/wage-and-hour-division-withdraws-three-tipped-employee-opinion-letters/record.json",
        "what_changed": [
            {
                "kind": "fact",
                "kind_label": "From the source",
                "text": "WHD withdrew Opinion Letters FLSA-895 (August 8, 1979), WH-502 (March 28, 1980) and FLSA-854 (December 20, 1985), which addressed tip credits for time servers spent on preparatory and cleanup tasks.",
                "evidence": [
                    {
                        "source": "https://www.dol.gov/sites/dolgov/files/WHD/fab/fab2026-1.pdf",
                        "locator": "Opening paragraph",
                        "excerpt": "This Field Assistance Bulletin (FAB) withdraws Wage and Hour Division (WHD or Division) Opinion Letters FLSA -895 (Aug. 8, 1979); WH-502 (Mar. 28, 1980); and FLSA-854, 1985 WL 1259240 (Dec. 20, 1985)."
                    },
                    {
                        "source": "https://www.dol.gov/sites/dolgov/files/WHD/fab/fab2026-1.pdf",
                        "locator": "Discussion",
                        "excerpt": "All are hereby withdrawn."
                    }
                ]
            },
            {
                "kind": "fact",
                "kind_label": "From the source",
                "text": "WHD says the three letters no longer reflect its policy and, in some respects, do not accurately state the law.",
                "evidence": [
                    {
                        "source": "https://www.dol.gov/sites/dolgov/files/WHD/fab/fab2026-1.pdf",
                        "locator": "Discussion",
                        "excerpt": "the 1979, 1980, and 1985 opinion letters no longer reflect Division policy and, in some respects, do not accurately state the law."
                    }
                ]
            },
            {
                "kind": "fact",
                "kind_label": "From the source",
                "text": "WHD confirms that the Field Operations Handbook section containing the 80/20 guidance on related duties, which it withdrew on January 14, 2025, no longer reflects its policy or reading of the law.",
                "evidence": [
                    {
                        "source": "https://www.dol.gov/sites/dolgov/files/WHD/fab/fab2026-1.pdf",
                        "locator": "Opening paragraph",
                        "excerpt": "WHD confirms the version of section 30d06( e) of the Field Operations Handbook (FOH) that included the 80/20 guidance on related duties, withdrawn on January 14, 2025 (see WHD FOH Revision 785) , no longer reflects the Division’s policy or interpretation of the Act."
                    }
                ]
            },
            {
                "kind": "fact",
                "kind_label": "From the source",
                "text": "WHD confirms that any guidance setting specific time limits on duties performed within a tipped occupation no longer reflects its policy.",
                "evidence": [
                    {
                        "source": "https://www.dol.gov/sites/dolgov/files/WHD/fab/fab2026-1.pdf",
                        "locator": "Discussion",
                        "excerpt": "This FAB confirms that any ... guidance that contemplates specific time limits on duties performed within a tipped occupation no longer reflects WHD policy."
                    }
                ]
            },
            {
                "kind": "fact",
                "kind_label": "From the source",
                "text": "WHD says the 1985 letter wrongly focused on individual tasks and treated 30 to 40 percent of a workday as a substantial portion, which it finds inconsistent with the Fifth Circuit's Restaurant Law Center decision.",
                "evidence": [
                    {
                        "source": "https://www.dol.gov/sites/dolgov/files/WHD/fab/fab2026-1.pdf",
                        "locator": "Discussion",
                        "excerpt": "the letter treats time amounting to 30 to 40 percent of an employee’s workday as consuming a substantial portion of that workday."
                    },
                    {
                        "source": "https://www.dol.gov/sites/dolgov/files/WHD/fab/fab2026-1.pdf",
                        "locator": "Discussion",
                        "excerpt": "This is inconsistent with the Restaurant Law C enter decision, which WHD finds persuasive"
                    }
                ]
            },
            {
                "kind": "fact",
                "kind_label": "From the source",
                "text": "The 1967 dual jobs regulation at 29 Code of Federal Regulations (CFR) 531.56(e) remains in effect, and WHD reads the statute and regulation to base the tip credit on whether an employee is engaged in a tipped occupation, not on the kinds of tasks performed within it.",
                "evidence": [
                    {
                        "source": "https://www.dol.gov/sites/dolgov/files/WHD/fab/fab2026-1.pdf",
                        "locator": "Background, C. Fifth Circuit Decision",
                        "excerpt": "Consequently, the 1967 dual jobs regulation set forth in subs ection 531.56(e) remains in effect today."
                    },
                    {
                        "source": "https://www.dol.gov/sites/dolgov/files/WHD/fab/fab2026-1.pdf",
                        "locator": "Discussion",
                        "excerpt": "Both the statute and regulation permit employers to take a tip credit based on whether an employee is engaged in a tipped “ occupation,” not whether the employee is performing certain kinds of duties or tasks within the tipped occupation."
                    }
                ]
            },
            {
                "kind": "fact",
                "kind_label": "From the source",
                "text": "WHD says the Department is developing a proposed rule to amend the tipped employee provisions in Subpart D of 29 CFR Part 531 and will welcome comments once it is published.",
                "evidence": [
                    {
                        "source": "https://www.dol.gov/sites/dolgov/files/WHD/fab/fab2026-1.pdf",
                        "locator": "Discussion",
                        "excerpt": "the Department is developing a notice of proposed rulemaking to amend various regulatory provisions in Subpart D of Part 531, related to tipped employees under the Act."
                    },
                    {
                        "source": "https://www.dol.gov/sites/dolgov/files/WHD/fab/fab2026-1.pdf",
                        "locator": "Discussion",
                        "excerpt": "Once published, the Department will welcome comments on any proposed rule impacting tipped employees."
                    }
                ]
            }
        ],
        "who_is_affected": [
            {
                "kind": "fact",
                "kind_label": "From the source",
                "text": "The bulletin is addressed to WHD's regional and district enforcement staff.",
                "evidence": [
                    {
                        "source": "https://www.dol.gov/sites/dolgov/files/WHD/fab/fab2026-1.pdf",
                        "locator": "Header",
                        "excerpt": "MEMORANDUM FOR Regional Administrators"
                    }
                ]
            },
            {
                "kind": "inference",
                "kind_label": "Our analysis",
                "text": "The employers it concerns are those that take a tip credit for tipped employees under the FLSA; the examples it discusses are restaurant servers and hotel workers.",
                "evidence": [
                    {
                        "source": "https://www.dol.gov/sites/dolgov/files/WHD/fab/fab2026-1.pdf",
                        "locator": "Background, A. The Fair Labor Standards Act",
                        "excerpt": "section 3(m) of the FLSA has permitted employers that meet certain requirements to satisfy a portion of their minimum wage obligation to a “tipped employee” by taking a partial credit"
                    },
                    {
                        "source": "https://www.dol.gov/sites/dolgov/files/WHD/fab/fab2026-1.pdf",
                        "locator": "Background, B.1. 1967 Regulation",
                        "excerpt": "The Division illustrates this concept with an individual employed by a hotel as both a waiter and a maintenance worker."
                    }
                ]
            }
        ],
        "business_implications": [
            {
                "kind": "inference",
                "kind_label": "Our analysis",
                "text": "WHD will no longer apply a percentage or time limit (such as the 80/20 test) on related, non-tip-producing duties when deciding whether an employer may take a tip credit; the question is whether the duties are part of the tipped occupation.",
                "evidence": [
                    {
                        "source": "https://www.dol.gov/sites/dolgov/files/WHD/fab/fab2026-1.pdf",
                        "locator": "Discussion",
                        "excerpt": "This FAB confirms that any ... guidance that contemplates specific time limits on duties performed within a tipped occupation no longer reflects WHD policy."
                    },
                    {
                        "source": "https://www.dol.gov/sites/dolgov/files/WHD/fab/fab2026-1.pdf",
                        "locator": "Background, C. Fifth Circuit Decision",
                        "excerpt": "“focuses on whether the employee performs tasks unrelated to his or her tipped occupation, not the amount of time spent on untipped tasks[.]”"
                    }
                ]
            },
            {
                "kind": "inference",
                "kind_label": "Our analysis",
                "text": "Time spent in a separate, non-tipped occupation still cannot be covered by a tip credit, so employers still need to know when a tipped employee is working in a non-tipped role.",
                "evidence": [
                    {
                        "source": "https://www.dol.gov/sites/dolgov/files/WHD/fab/fab2026-1.pdf",
                        "locator": "Background, B.1. 1967 Regulation",
                        "excerpt": "For the hours worked by the employee in a non- tipped occupation, the employer may not take the tip credit and must pay the employee at least the full minimum wage for hours worked in the non- tipped occupation."
                    }
                ]
            },
            {
                "kind": "inference",
                "kind_label": "Our analysis",
                "text": "The tipped employee rules may change again through the proposed rule WHD says the Department is developing.",
                "evidence": [
                    {
                        "source": "https://www.dol.gov/sites/dolgov/files/WHD/fab/fab2026-1.pdf",
                        "locator": "Discussion",
                        "excerpt": "the Department is developing a notice of proposed rulemaking to amend various regulatory provisions in Subpart D of Part 531, related to tipped employees under the Act."
                    }
                ]
            }
        ],
        "required_actions": [
            {
                "kind": "fact",
                "kind_label": "From the source",
                "text": "An employer that takes a tip credit must pay the tipped employee a direct cash wage of at least $2.13 per hour, an existing requirement of section 3(m) of the FLSA that the bulletin describes.",
                "evidence": [
                    {
                        "source": "https://www.dol.gov/sites/dolgov/files/WHD/fab/fab2026-1.pdf",
                        "locator": "Background, A. The Fair Labor Standards Act",
                        "excerpt": "the employer must pay the tipped employee a direct cash wage of at least $2.13 per hour ."
                    }
                ]
            },
            {
                "kind": "fact",
                "kind_label": "From the source",
                "text": "For hours an employee works in a non-tipped occupation, the employer may not take the tip credit and must pay at least the full minimum wage, an existing requirement of the dual jobs regulation at 29 CFR 531.56(e) that the bulletin describes.",
                "evidence": [
                    {
                        "source": "https://www.dol.gov/sites/dolgov/files/WHD/fab/fab2026-1.pdf",
                        "locator": "Background, B.1. 1967 Regulation",
                        "excerpt": "For the hours worked by the employee in a non- tipped occupation, the employer may not take the tip credit and must pay the employee at least the full minimum wage for hours worked in the non- tipped occupation."
                    }
                ]
            }
        ],
        "recommended_actions": [
            {
                "kind": "recommendation",
                "kind_label": "Our suggestion",
                "text": "Consider reviewing tip credit policies, timekeeping codes or payroll rules that rely on a percentage-of-time or continuous-minutes limit on related duties, since WHD says such guidance no longer reflects its policy.",
                "evidence": [
                    {
                        "source": "https://www.dol.gov/sites/dolgov/files/WHD/fab/fab2026-1.pdf",
                        "locator": "Discussion",
                        "excerpt": "This FAB confirms that any ... guidance that contemplates specific time limits on duties performed within a tipped occupation no longer reflects WHD policy."
                    }
                ]
            },
            {
                "kind": "recommendation",
                "kind_label": "Our suggestion",
                "text": "Consider updating any internal guidance that cites Opinion Letters FLSA-895, WH-502 or FLSA-854, since WHD says they should no longer be relied on.",
                "evidence": [
                    {
                        "source": "https://www.dol.gov/sites/dolgov/files/WHD/fab/fab2026-1.pdf",
                        "locator": "Opening paragraph",
                        "excerpt": "These withdrawn opinion letters and the FOH provision that implemented them should no longer be relied upon as WHD enforcement guidance."
                    }
                ]
            },
            {
                "kind": "recommendation",
                "kind_label": "Our suggestion",
                "text": "Consider checking whether tipped employees are also assigned to a separate non-tipped role (like the hotel waiter who also does maintenance), and that those hours are paid at least the full minimum wage.",
                "evidence": [
                    {
                        "source": "https://www.dol.gov/sites/dolgov/files/WHD/fab/fab2026-1.pdf",
                        "locator": "Background, B.1. 1967 Regulation",
                        "excerpt": "the employer may take a tip credit against its minimum wage obligation only for the hours the tipped employee spends engaged in the tipped occupation."
                    }
                ]
            },
            {
                "kind": "recommendation",
                "kind_label": "Our suggestion",
                "text": "Consider watching for the Department's proposed rule on tipped employees and deciding whether to comment when it is published.",
                "evidence": [
                    {
                        "source": "https://www.dol.gov/sites/dolgov/files/WHD/fab/fab2026-1.pdf",
                        "locator": "Discussion",
                        "excerpt": "Once published, the Department will welcome comments on any proposed rule impacting tipped employees."
                    }
                ]
            }
        ],
        "required_actions_assessment": null,
        "applicability": [
            {
                "criterion": "where",
                "label": "Where",
                "answer": "United States, nationwide",
                "kind": "fact",
                "kind_label": "From the source",
                "evidence": []
            },
            {
                "criterion": "employer_type",
                "label": "Employers",
                "answer": "Employers covered by the FLSA that take a tip credit toward the minimum wage for tipped employees.",
                "kind": "inference",
                "kind_label": "Our analysis",
                "evidence": [
                    {
                        "source": "https://www.dol.gov/sites/dolgov/files/WHD/fab/fab2026-1.pdf",
                        "locator": "Background, A. The Fair Labor Standards Act",
                        "excerpt": "section 3(m) of the FLSA has permitted employers that meet certain requirements to satisfy a portion of their minimum wage obligation to a “tipped employee” by taking a partial credit"
                    }
                ]
            },
            {
                "criterion": "size",
                "label": "Size",
                "answer": "The bulletin sets no size threshold of its own; it concerns employers covered by the FLSA, whose coverage rules it does not describe.",
                "kind": "inference",
                "kind_label": "Our analysis",
                "evidence": [
                    {
                        "source": "https://www.dol.gov/sites/dolgov/files/WHD/fab/fab2026-1.pdf",
                        "locator": "Background, A. The Fair Labor Standards Act",
                        "excerpt": "The FLSA generally requires covered employers to pay employees at least the federal minimum wage for all hours worked"
                    }
                ]
            },
            {
                "criterion": "industries",
                "label": "Industries",
                "answer": "Any industry with tipped employees; the bulletin's examples are restaurants and hotels.",
                "kind": "inference",
                "kind_label": "Our analysis",
                "evidence": [
                    {
                        "source": "https://www.dol.gov/sites/dolgov/files/WHD/fab/fab2026-1.pdf",
                        "locator": "Background, B.1. 1967 Regulation",
                        "excerpt": "The Division illustrates this concept with an individual employed by a hotel as both a waiter and a maintenance worker."
                    },
                    {
                        "source": "https://www.dol.gov/sites/dolgov/files/WHD/fab/fab2026-1.pdf",
                        "locator": "Background, B.2. 2021 Regulation and Antecedent Subregulatory Guidance",
                        "excerpt": "whether an employer may claim a tip credit for time spent by a waitress preparing vegetables for the salad bar."
                    }
                ]
            },
            {
                "criterion": "functions",
                "label": "Functions",
                "answer": "Payroll (tip credit and minimum wage), HR (job assignments) and legal or compliance teams.",
                "kind": "inference",
                "kind_label": "Our analysis",
                "evidence": [
                    {
                        "source": "https://www.dol.gov/sites/dolgov/files/WHD/fab/fab2026-1.pdf",
                        "locator": "Background, B.1. 1967 Regulation",
                        "excerpt": "the employer may take a tip credit against its minimum wage obligation only for the hours the tipped employee spends engaged in the tipped occupation."
                    }
                ]
            },
            {
                "criterion": "applies_if",
                "label": "Applies if",
                "answer": "You employ workers who customarily and regularly receive more than $30 a month in tips and you take a tip credit for them.",
                "kind": "inference",
                "kind_label": "Our analysis",
                "evidence": [
                    {
                        "source": "https://www.dol.gov/sites/dolgov/files/WHD/fab/fab2026-1.pdf",
                        "locator": "Discussion",
                        "excerpt": "“any employee engaged in an occupation in which he customarily and regularly receives more than $30 a month in tips,”"
                    }
                ]
            },
            {
                "criterion": "action",
                "label": "Action",
                "answer": "Consider reviewing tip credit practices that rely on the withdrawn letters or a time-limit test.",
                "kind": "recommendation",
                "kind_label": "Our suggestion",
                "evidence": [
                    {
                        "source": "https://www.dol.gov/sites/dolgov/files/WHD/fab/fab2026-1.pdf",
                        "locator": "Opening paragraph",
                        "excerpt": "These withdrawn opinion letters and the FOH provision that implemented them should no longer be relied upon as WHD enforcement guidance."
                    }
                ]
            }
        ],
        "open_questions": [
            {
                "question": "How will WHD decide when a duty is unrelated to a tipped occupation, now that time limits no longer apply?",
                "context": "The bulletin points to the 1967 regulation's related-duties language and its examples but gives no new test beyond that."
            },
            {
                "question": "When will the Department publish its proposed rule on tipped employees, and what would it change?",
                "context": "The bulletin says a proposed rule is being developed but gives no date or content."
            }
        ],
        "events": [
            {
                "event_type": "originating_action",
                "label": "Issued",
                "occurred_on": "2026-10-19",
                "summary": "FAB 2026-1: Withdrawal of Opinion Letters FLSA-895 (Aug. 8, 1979), WH-502 (Mar. 28, 1980), FLSA-854 (Dec. 20, 1985), and 80/20 Guidance on Related Duties",
                "source": "https://www.dol.gov/sites/dolgov/files/WHD/fab/fab2026-1.pdf"
            }
        ],
        "corrections": [],
        "sources": [
            {
                "label": "Withdrawal of Opinion Letters FLSA-895 (Aug. 8, 1979), WH-502 (Mar. 28, 1980), FLSA-854 (Dec. 20, 1985), and 80/20 Guidance on Related Duties",
                "publisher": "Wage and Hour Division",
                "role": "primary",
                "url": "https://www.dol.gov/sites/dolgov/files/WHD/fab/fab2026-1.pdf"
            }
        ]
    }
}