CRA: Tip Credit, Paid Leave Guidance

There's no news on PPP applications yet, but here's what you need to know about paid COVID leave and tip pools in 2021.

Medical mask with dollars and the words paid sick leave on a blue background.
Paid COVID-related leave in 2020? Get ready for another round in 2021. / Ilnaz Bagautdinov ©

A second round of PPP has been officially approved despite temper tantrums in D.C., though details about how to apply aren’t yet finalized. What is finalized: A new ruling from the state that businesses must provide up to 80 hours of paid sick leave to employees who miss work due to COVID in 2021 (in addition to any paid leave given in 2020), as well as a Department of Labor rule that allows employers who don’t take a tip credit to pool and distribute tips to the back of house. Here’s what you need to know.

In addition, seven Colorado counties have now been approved for the 5 Star Certification Program; find out if yours is.

The following information comes from the CRA’s December 23 and 28 newsletters. Sign up to receive the full version here. And take a gander at its Coronavirus Resource Center and on our Covid-19 Reopening Resources for general info.

COVID-19 Relief Package Signed Into Law

On December 27, President Trump signed the $900 billion COVID-19 relief package into law, nearly a week after it was passed by Congress. The plan includes several items that will benefit restaurants, most importantly a second round of access to the Paycheck Protection Program (PPP), with unique provisions aimed at assisting the restaurant industry including enhanced loan size and accessibility. You can read about Congress’s bill here.

Now that the bill has been signed into law, we will continue to provide you with instructions on how and when you can apply for aid.

Clarification on Healthy Families and Workplace Act

The Colorado Department of Labor and Employment (CDLE) has issued clarifying revisions to the Healthy Families and Workplaces Act that will take effect on January 1, 2021. In response to a COVID-19 public health emergency, employers must provide 80 hours of paid leave for COVID-19 needs (or proportionately fewer hours for part-time employees) that may be used starting January 1, 2021. This is distinct from the 80-hour COVID-19 leave in 2020 that was based on the federal paid leave law in effect through the end of the year.

Read more here from our partners at Fisher & Phillips. 

Additional resources on labor and employment law changes taking effect in 2021 are available on CDLE’s INFO & Guidance Webpage.

5 Star State Certification Program County Guide

We are beginning to see restaurants reopen their indoor dining rooms at a limited capacity in counties with approved 5 Star State Certification Programs. Counties interested in implementing the 5 Star State Certification Program must submit a variance application for State approval. Once approved, the county can then launch its application for businesses. Interested businesses can apply for the program through their local county application system. Approved restaurants can then utilize the capacity guidelines and last call hours of the next, less restrictive dial level. 

We will continue to provide an updated list of counties with approved 5 Star State Certification Programs and how to find details on the specifics of the program and application process in each county:

You can also access our 5 Star County Guide on our website here. You can read more about the 5 Star State Certification Program here.

Department of Labor Releases Final Tip Credit Rule 

The U .S. Department of Labor (DOL) has revised tipping regulations under the Fair Labor Standards Act (FLSA). The final rule allows employers who do not take a tip credit to pool tips and distribute to back-of-house employees. It does not change the tip pooling requirements for restaurants that count tips as a part of wages. In no circumstance are managers and supervisors permitted to keep tips received by employees. The final rule also confirms DOL’s informal guidance that an employer may take a tip credit for any amount of time an employee in a tipped occupation performs related non-tipped duties. For the employer to use the tip credit, the employee must do their side-work within a reasonable time immediately before or after performing the tipped duties.

This brings necessary clarification for employers and their employees and is a victory for the restaurant industry. We thank our partners at the National Restaurant Association for their advocacy for these revisions.

Click here for more information.

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