Quick Hits
- Managers and supervisors who meet the FLSA’s executive duties test generally may not participate in tip pools or tip shares, even when performing tipped work, but may retain tips received solely and directly for services they personally provide.
- Nonprofit exempt employees may volunteer for their employer only if their services are freely performed, there is no expectation of pay, and the work differs from the work they are employed to perform; if these conditions are not met, they can work without additional compensation so long as their primary duty remains the performance of exempt work (and they meet the salary basis requirement).
- Employees who are relieved of duties during a sixty-minute meal period generally have a bona fide unpaid meal period even if they spend several minutes walking to and from a designated break area.
FLSA2026-13: Tips Shared With Managers and Supervisors
A server requested an opinion letter related to sharing tips with an employee whose title is “shift supervisor” and stated that the position primarily performs management duties. The employee asked whether, when the shift supervisor works a bartending shift periodically or assists positions like hosts and bussers, the supervisor can share in tips.
The WHD again reiterated the principles previously laid out in opinion letter FLSA2025-1. Without opining on whether the shift supervisor was actually a manager or supervisor, the WHD explained that a manager or supervisor who meets the executive duties test (job title is not dispositive), regardless of whether the individual meets the salary requirements in 29 C.F.R. § 541.100 and Subpart G, cannot keep employees’ tips or otherwise participate in a tip pool or tip share. This remains true even if the manager or supervisor performs nonmanagerial duties, including in a tipped occupation such as a server or bartender or alongside other employees the individual manages. The only exception to this occurs if a manager or supervisor solely and directly performs services and receives a tip from a customer. Notably, Section 3(m)(2)(B) of the Fair Labor Standards Act (FLSA) does not prohibit an employer from requiring a manager or supervisor who receives tips directly from customers to contribute some portion of those tips to eligible employees in an employer-mandated tip pooling or tip sharing arrangement.
So, in this case with the shift supervisor, the WHD explained the shift supervisor may keep tips left by his bar customers during the period in which he is bartending since he solely and directly provided services. If, however, the shift supervisor’s tips and other bartenders’ tips are consolidated and split among all bartenders working that shift, it is not possible to attribute the tip solely to the supervisor, and therefore the supervisor is not permitted to take any portion of those tips.
The WHD provided two other examples to explain these principles. In a scenario where a manager helps servers and bussers serve customers, the manager cannot keep any tips. If instead the manager covers a few tables because a server called out sick, she may keep the tips given to her by customers at those tables for services that the manager directly and solely performed. In another scenario where a coffee shop maintains a tip jar and point-of-sale system for customer tipping, a barista, who is regularly left in charge and meets the executive duties test as a supervisor or manager, may not keep any portion of the tips the customers provide because it is not possible to attribute the tips solely to the service the employee provides.
The WHD noted the penalties associated with violation of section 3(m)(2)(B) of the FLSA, which include recovery of the tips the supervisor “kept” as well as an invalidated tip credit for affected tipped employees.
FLSA2026-12: Volunteering for Nonprofit Employer
In FLSA2026-12, a nonprofit organization that breeds, raises, and trains service dogs to assist individuals with visual impairments and veterans with post-traumatic stress disorder inquired whether their exempt employees may volunteer for the organization to provide juvenile canine socialization services at home. The WHD determined this is permissible as long as the employees do so freely and without coercion, with no contemplation of pay for the volunteer services rendered, and the volunteer services are not the same type of services the organization employs the employees to perform. Stated differently, the WHD explained “a nonprofit employee cannot be both a paid employee and a non-paid volunteer while performing the same type of work for the same employer.”
The WHD explained while this is true for both exempt and nonexempt employees, there are different considerations for exempt employees. If the nonexempt employee is performing the same work, that work is not voluntary and would be compensable time. In contrast, if the exempt employee is performing the same or similar work, and still satisfies the duties test, the employer does not owe extra compensation for this work. However, when the volunteer work qualifies as nonexempt work (in this case, the issue was an exempt trainer performing volunteer, juvenile canine socialization work, which the WHD categorized as nonexempt work), the employee’s primary duty must remain the performance of exempt work. In determining whether exempt work is the primary duty of the employee, an employee who spends more than 50 percent of his or her time performing qualifying exempt work will usually satisfy the primary duty test, but it is ultimately a qualitative fact determination.
FLSA2026-11: Meal Periods and Walking Time
A security therapy aide at a detention facility requested an opinion from the WHD regarding whether an uncompensated sixty-minute meal period for which employees spend six to fourteen minutes walking to and from the employer’s designated meal break constitutes a bona fide meal break. The employee also asserted the time traveling to and from the break area should be compensable.
Setting aside any analysis or opinion as to the terms of the collective bargaining agreement (CBA) providing for this sixty-minute meal period, the WHD explained that the remaining forty-six to fifty-four minutes subtracting travel time constitutes a bona fide meal break when there is no indication the employer requires employees to work while eating and employees are relieved from any work responsibilities during that time. Relevant authority is crystal clear that so long as the employee is relieved from duties, even “30 minutes or more is long enough for a bona fide meal period.” But even meal periods of less than thirty minutes can be bona fide and not compensable if employees have sufficient time to eat a regular meal or there is an agreement between employer and employee for a period of less than thirty minutes for a meal period. Most often though, short rest breaks of up to twenty minutes in length are compensable because they “promote the efficiency of the employee.”
With respect to the travel time to and from the break area, the WHD rejects the “complete relief from duty standard.” When employees need just a few minutes of travel time to access a break room or other location where they can eat their meal, that time is generally not compensable.
Ogletree Deakins’ Hospitality Industry Group and Wage and Hour Practice Group will continue to monitor developments and will post updates on the Hospitality and Wage and Hour blogs as additional information becomes available.
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