--- title: eAlert! Federal 80/20/30 Tip Credit Rule Thrown Out description: 8/23/2024 - The Fifth Circuit Court of Appeals vacated the DOL’s so-called “80/20/30” tip credit rule. The decision applies nationwide. image: https://blog.threadhcm.com/hubfs/HR%20eAlert!%20(1).png --- - - - - [Solutions](https://threadhcm.com/solutions/) - [Applicant Tracking](https://threadhcm.com/applicant-tracking/) - [Human Resources](https://threadhcm.com/human-resources/) - [Payroll](https://threadhcm.com/payroll/) - [Time](https://threadhcm.com/time/) - [Benefits Enrollment](https://threadhcm.com/benefits/) - [ACA Compliance](https://threadhcm.com/aca-compliance/) - [Employee Experience](https://threadhcm.com/employee-experience/) - [Learning Management](https://threadhcm.com/learning-management-system/) - [HR Consulting](https://threadhcm.com/hr-consulting/) - Resources - [Daily Thread Blog](https://blog.threadhcm.com/) - [Free Webinars](https://threadhcm.com/webinars/) - [isolved Releases](https://blog.threadhcm.com/tag/isolved-releases) - [HR eAlerts](https://blog.threadhcm.com/tag/hr-ealerts) - [Infographics](https://blog.threadhcm.com/tag/infographics) - [Press Releases](https://blog.threadhcm.com/tag/press-release) - [![Thread HCM](https://blog.threadhcm.com/hs-fs/hubfs/Thread_February2020%20Theme/Images/thread-logo-green.png?width=100&height=100&name=thread-logo-green.png "Thread HCM")](https://threadhcm.com) - [Your Happiness](https://threadhcm.com/measuring-your-happiness/) - About - [Our Story](https://threadhcm.com/our-story/) - [Our Culture](https://threadhcm.com/our-culture/) - [Our Team](https://threadhcm.com/team/) - [Associations & More](https://threadhcm.com/associations/) - Contact - [Get In Touch](https://threadhcm.com/contact/) - [Careers at Thread](https://threadhcm.com/careers/) - [Broker or advisor?](https://threadhcm.com/partners/) - [Client Referrals](https://offers.threadhcm.com/refer-a-friend) - [Thread Office Closures](https://offers.threadhcm.com/thread-closures) - [![Demo](https://no-cache.hubspot.com/cta/default/2515809/a2b12e0e-ed5a-400b-912c-d234fd8519d8.png)](https://cta-redirect.hubspot.com/cta/redirect/2515809/a2b12e0e-ed5a-400b-912c-d234fd8519d8) - *search* *Press enter to begin your search* [![Thread HCM](https://blog.threadhcm.com/hs-fs/hubfs/Thread_February2020%20Theme/Images/thread-logo-green.png?width=250&height=250&name=thread-logo-green.png "Thread HCM")](https://threadhcm.com/) - Solutions - [Applicant Tracking](https://threadhcm.com/applicant-tracking/) - [Human Resources](https://threadhcm.com/human-resources/) - [Payroll](https://threadhcm.com/payroll/) - [Time](https://threadhcm.com/time/) - [Benefits Enrollment](https://threadhcm.com/benefits/) - [ACA Compliance](https://threadhcm.com/aca-compliance/) - [Learn + Learn Pro LMS](https://threadhcm.com/learning-management-system/) - [Consulting](https://threadhcm.com/hr-consulting/) - About - [Our Story](https://threadhcm.com/our-story/) - [Our Culture](https://threadhcm.com/our-culture/) - [Our Team](https://threadhcm.com/team/) - Resources - [Daily Thread Blog](https://blog.threadhcm.com/) - [Infographics](https://blog.threadhcm.com/tag/infographics) - [Press Releases](https://blog.threadhcm.com/tag/press-release) - [iSolved Releases](https://blog.threadhcm.com/tag/isolved-releases) - [Webinars – Live & On Demand](https://threadhcm.com/webinars/) - Contact - [Get In Touch](https://threadhcm.com/contact/) - [Careers at Thread](https://threadhcm.com/careers/) - [Broker or advisor?](https://threadhcm.com/partners/) - [Client Referrals](https://offers.threadhcm.com/refer-a-friend) - [Thread Office Closures](https://offers.threadhcm.com/thread-closures) - [Demo](https://threadhcm.com/demo/) - - - [HR eAlerts](https://blog.threadhcm.com/tag/hr-ealerts) # eAlert! Federal 80/20/30 Tip Credit Rule Thrown Out By [HR Pros at HR Support Center](https://blog.threadhcm.com/author/hr-pros-at-hr-support-center) August 29, 2024 ## DOL’s 80/20/30 Tip Credit Rule Thrown Out **August 23, 2024** On August 23, 2024, the Fifth Circuit Court of Appeals vacated the DOL’s so-called “80/20/30” tip credit rule. The decision applies nationwide. In short, the rule required employers to pay tipped employees the full minimum wage—without a tip credit—for work time that was not directly *tip-producing* but was only *tip-supporting* **if** that work took more than 30 continuous minutes or constituted more than 20% of their workweek. Using a waiter as an example, tip-producing work would include serving patrons, while tip-supporting work would include bussing tables. ## Takeaways for Employers The decision significantly simplifies the application of the tip credit under *federal* law. Employers no longer need to distinguish between tip-producing and tip-supporting work or monitor the time spent performing tip-supporting duties. However, employers are still subject to local or state laws that are more beneficial to employees or that prohibit tip credits entirely. And as was the case before, employers can’t take a tip credit when an employee performs tasks *unrelated* to their tipped occupation. For example, if a hotel waiter also does maintenance work, time spent on maintenance is not subject to the tip credit. The DOL may appeal this decision. We’ll provide an alert if there are any significant updates. The Fifth Circuit Court of Appeals’ decision in [*Restaurant Law Center v. U.S. Department of Labor*](https://www.ca5.uscourts.gov/opinions/pub/23/23-50562-CV0.pdf) was issued on August 23, 2024. ### Stop worrying about labor laws, and let Thread take the administrative work out of HR. Let us know how we can help! #### **THE DAILY THREAD** The best tips on running a business delivered to your inbox.   ### Most Popular [![Creative Workplace Perks That Boost Engagement](https://blog.threadhcm.com/hs-fs/hubfs/party.webp?width=300&name=party.webp) Creative Workplace Perks That Boost Engagement May 5, 2025](https://blog.threadhcm.com/workplace-perks) [![A Heavyweight in Benefits](https://blog.threadhcm.com/hs-fs/hubfs/Employee%20Engagement/Female%20doctor%20hand%20holding%20syringe%20with%20blue%20background%20and%20charts.jpeg?width=300&name=Female%20doctor%20hand%20holding%20syringe%20with%20blue%20background%20and%20charts.jpeg) A Heavyweight in Benefits March 20, 2025](https://blog.threadhcm.com/weight-loss-drugs) [![Mental health challenges in the workplace](https://blog.threadhcm.com/hs-fs/hubfs/Imported_Blog_Media/landscape-mental-health.jpg?width=300&name=landscape-mental-health.jpg) Mental health challenges in the workplace November 29, 2024](https://blog.threadhcm.com/mental-health-in-the-workplace) ### Most Recent [![](https://blog.threadhcm.com/hs-fs/hubfs/offers.threadhcm.comtime-demo.jpg?width=100&height=100&name=offers.threadhcm.comtime-demo.jpg) Georgia Paid Time Off Laws (PTO) in 2026: A Guide June 22, 2026](https://blog.threadhcm.com/georgia-pto-laws) [![](https://blog.threadhcm.com/hs-fs/hubfs/gas-price-pump-mileage.png?width=100&height=100&name=gas-price-pump-mileage.png) IRS Standard Mileage Rates: Calculating Mileage Rates May 12, 2026](https://blog.threadhcm.com/irs-standard-mileage-rate) [![](https://blog.threadhcm.com/hs-fs/hubfs/Downtown%20Atlanta%2c%20Georgia%2c%20USA%20skyline..jpeg?width=100&height=100&name=Downtown%20Atlanta,%20Georgia,%20USA%20skyline..jpeg) An Overview: Minimum Wage in Georgia April 15, 2026](https://blog.threadhcm.com/georgia-minimum-wage) [![](https://blog.threadhcm.com/hs-fs/hubfs/paycheck-checkup-1024x416.webp?width=100&height=100&name=paycheck-checkup-1024x416.webp) A Guide to Understanding Gross Pay vs Net Pay March 23, 2026](https://blog.threadhcm.com/gross-pay-vs-net-pay) [![](https://blog.threadhcm.com/hs-fs/hubfs/Savannah%2c%20Georgia%2c%20USA%20oak%20tree%20lined%20road%20at%20historic%20Wormsloe%20Plantation..jpeg?width=100&height=100&name=Savannah,%20Georgia,%20USA%20oak%20tree%20lined%20road%20at%20historic%20Wormsloe%20Plantation..jpeg) Understanding Georgia’s Noncompete Laws January 19, 2026](https://blog.threadhcm.com/noncompete-laws-georgia) - ### Previous Post Deepfake Technology: An Increasing Threat - ### Next Post eAlert! New Hampshire Prohibits Hairstyle Discrimination ### Recommended For You [![Georgia Paid Time Off Laws (PTO) in 2026: A Guide](https://blog.threadhcm.com/hubfs/offers.threadhcm.comtime-demo.jpg)](https://blog.threadhcm.com/georgia-pto-laws) ### Georgia Paid Time Off Laws (PTO) in 2026: A Guide ![Barbara Collins](https://blog.threadhcm.com/hubfs/headshot_circle.gif) [Barbara Collins](https://blog.threadhcm.com/author/barbara-collins) June 22, 2026 [![IRS Standard Mileage Rates: Calculating Mileage Rates](https://blog.threadhcm.com/hubfs/gas-price-pump-mileage.png)](https://blog.threadhcm.com/irs-standard-mileage-rate) ### IRS Standard Mileage Rates: Calculating Mileage Rates ![Barbara Collins](https://blog.threadhcm.com/hubfs/headshot_circle.gif) [Barbara Collins](https://blog.threadhcm.com/author/barbara-collins) May 12, 2026 [![An Overview: Minimum Wage in Georgia](https://blog.threadhcm.com/hubfs/Downtown%20Atlanta%2c%20Georgia%2c%20USA%20skyline..jpeg)](https://blog.threadhcm.com/georgia-minimum-wage) ### An Overview: Minimum Wage in Georgia ![Barbara Collins](https://blog.threadhcm.com/hubfs/headshot_circle.gif) [Barbara Collins](https://blog.threadhcm.com/author/barbara-collins) April 15, 2026 #### Get In Touch 12640 Crabapple Rd., Suite 340 Milton, GA 30004 - [678-366-3447](tel:+1-678-366-3447) - [info@threadhcm.com](mailto:info@threadhcm.com) - - - - [Applicant Tracking](https://threadhcm.com/applicant-tracking/) - [Benefits Enrollment](https://threadhcm.com/benefits/) - [Employee Experience](https://threadhcm.com/employee-experience/) - [Human Resources](https://threadhcm.com/human-resources/) - [Learning Management](https://threadhcm.com/learning-management-system/) - [Payroll](https://threadhcm.com/payroll/) - [Predictive People Analytics](https://threadhcm.com/predictive-people-analytics/) - [Time](https://threadhcm.com/time/) #### Want to Partner? Want to see exactly how iSolved can work for your company? - [REQUEST A DEMO](https://threadhcm.com/demo/) - [HR Consulting Services](https://threadhcm.com/hr-consulting/) - [Brokers & Advisors](https://threadhcm.com/partners/) - More Helpful Links - [isolved Releases](https://blog.threadhcm.com/tag/isolved-releases) - [Contact](https://threadhcm.com/contact/) - [Careers at Thread](https://threadhcm.com/careers/) - [Company Culture](https://threadhcm.com/culture/) - [Our Team](https://threadhcm.com/team/) - [The Daily Thread Blog](https://blog.threadhcm.com/) © 2025 Thread HCM. All Rights Reserved. - - -