|                                                            | U.S. Department of Labor |
|------------------------------------------------------------|--------------------------|
| Employment Standards Administration Wage and Hour Division |

Fact Sheet #2: Restaurants and Fast Food Establishments Under the Fair Labor Standards      Act (FLSA)
This fact sheet provides general information concerning the application      of the FLSA to employees of restaurants and fast food establishments.
Characteristics
The restaurant/fast food industry includes establishments which are      primarily engaged in selling and serving to purchasers prepared food and      beverages for consumption on or off the premises.
Coverage
Restaurants/fast food businesses with annual gross sales from one or      more establishments that total at least $500,000 are subject to the FLSA.      Also, any person who works on or otherwise handles goods that are moving      in interstate commerce is individually subject to the minimum wage and      overtime protection of the FLSA. For example, a waitress or cashier who      handles a credit card transaction would in all probability be subject to      the Act.
Requirements
Minimum Wage: Covered non-exempt workers are entitled to a minimum wage       --$5.15 an hour effective 9/1/97. Wages are due on the regular payday for       the pay period covered. Deductions made from wages for items such as cash       shortages, required uniforms, or customer walk-outs are illegal if the deduction       reduces the employee's wages below the minimum wage or cuts into overtime       pay. Deductions made for items other than board, lodging, or other recognized       facilities normally cannot be made in an overtime workweek. Tips may be       considered as part of wages, but the employer must pay not less than $2.13       an hour in direct wages and make sure that the amount of tips received is       enough to meet the remainder of the minimum wage.

Food Credit: The employer may take credit for food which is provided at      cost. This typically is an hourly deduction from an employee's pay.      However, the employer cannot take credit for discounts given employees on      food (menu) prices. 

Tips: Tipped employees are those who customarily and regularly receive      more than $30 a month in tips. Employees must be informed in advance if      the employer elects to use the tip credit, the amount of tip credit to be      claimed, and the employer must be able to show that employees receive at      least the applicable minimum wage when wages and tips are combined. Also,      employees must retain all of their tips, except in the case of valid tip      pool arrangements.

Overtime: Overtime must be paid at a rate of at least one and one-half      times the employee's regular rate of pay for each hour worked in excess of      40 hours per week. Tipped employees who receive $2.13 per hour in direct      wages are also subject to overtime at one and one-half times the      applicable minimum wage, not one and one-half times $2.13.

Youth Minimum Wage: The 1996 Amendments to the FLSA allow employers to      pay a youth minimum wage of not less that $4.25 an hour to employees who      are under 20 years of age during the first 90 consecutive calendar days      after initial employment by their employer. The law contains certain      protections for employees that prohibit employers from displacing any      employee in order to hire someone at the youth minimum wage.
Child Labor
Youths 14 and 15 years old may work outside school hours in various      non-hazardous jobs only under the following conditions: 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. Also, work may not begin before 7      a.m., nor end after 7 p.m., except from June 1 through Labor Day, when      evening hours are extended to 9 p.m. Permitted occupations for 14 and 15      year old employees include those such as cashier, office/clerical work,      bagging orders, cleanup work, hand-cleaning vegetables, etc. Cooking and      baking cannot generally be performed by minors under age 16.

Youths 16 and 17 years old may perform any non-hazardous job, for unlimited   hours. Examples of equipment declared hazardous in restaurants include power-driven   meat processing machines (saws, patty forming machines, grinding, chopping or   slicing machines), commercial mixers, and certain power-driven bakery machines.   Employees under 18 are not permitted to operate, feed, set-up, adjust, repair   or clean such machines. Generally, no employee under 18 years of age may drive   or serve as an outside-helper on a motor vehicle on a public road; but 17-year-olds   who meet certain specific requirements may drive automobiles and trucks that   do not exceed 6,000 pounds gross vehicle weight for limited amounts of time   as part of their job. Such minors are, however, prohibited from making time   sensitive deliveries (such as pizza deliveries or other trips where time is   of essence) and from driving at night. (See Fact Sheet No. 34 http://www.dol.gov/esa/regs/compliance/whd/whdfs34.htm.)
Typical Problems
If uniforms are required by the employer the cost of the uniform is      considered to be a business expense of the employer. If the employer      requires the employee to bear the cost, such cost may not reduce the      employee's wages below the minimum wage or cut into overtime compensation.    

Exemptions from Overtime: Section 13(a)(1) of the FLSA provides an      exemption from FLSA monetary requirements for an employee employed in a      bona fide executive, administrative or professional capacity or as an      outside salesperson. An employee will qualify for exemption if all      pertinent tests relating to duties, responsibilities and salary, as set      forth in Regulations, 29 CFR Part 541, are met. The salary and duties      tests for the exemptions are fully described in Regulations Part 541.
Where to Obtain Additional Information
 This publication is for general information and is not to be considered       in the same light as official statements of position contained in the regulations.

**For additional information, visit our Wage-Hour website: http://www.wagehour.dol.gov       and/or call our Wage-Hour toll-free information and helpline, available       8am to 5pm in your time zone, 1-866-4USWAGE (1-866-487-9243).**

 
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