Labor & Employment Law Update

The U.S. Department of Labor’s (DOL) Wage and Hour Division recently issued three opinion letters addressing meal periods, tip pooling, and volunteer arrangements under the Fair Labor Standards Act (FLSA). Although the letters arise from hospitality, detention facility, and nonprofit settings, each provides practical guidance for employers reviewing their wage and hour compliance practices. Employers should take the opportunity to ensure their meal break, tip pooling, and volunteer policies align with the DOL’s latest interpretations.

When Is a Meal Break Compensable? DOL Addresses Required Walking Time (FLSA2026-11)

The DOL reviewed a 60-minute unpaid lunch period established under a collective bargaining agreement. Employees spent six to 14 minutes walking to and from a designated break area, leaving 46 to 54 minutes in the break area itself. The DOL concluded the break remained a bona fide, non-compensable meal period because:

• Sufficient time remained to eat. Even under the maximum reported travel time, employees retained 46 to 54 minutes in the break area, well above the 30-minute period ordinarily sufficient for a bona fide meal break.
• Employees were relieved of duty during the meal period. The DOL found the break remained non-compensable because employees had ample time to eat and were relieved of their duties during the meal period. Applying its longstanding “predominant benefit” test, the DOL concluded the meal period primarily benefited employees rather than the employer.
• Collective bargaining agreement did not control the outcome. Although collective bargaining agreements cannot waive FLSA rights, a disagreement over the length of a negotiated meal period does not automatically create FLSA liability.

Can Managers Participate in a Tip Pool? DOL Says Duties Matter More Than Job Titles (FLSA2026-13)

DOL addressed a “shift supervisor” who periodically bartended and assisted hosts and bussers while also performing management functions, and who collected a “tip out” from servers. The DOL concluded that employees whose duties qualify them as managers or supervisors under the FLSA cannot keep any portion of other employees’ tips, even when they spend part of their shift performing tipped work. Performing tipped work during the shift does not change the supervisor analysis.

• Duties control, not titles. A “bartender” who directs staff, sets schedules, and has meaningful input on hiring may still qualify as a supervisor for tip pooling purposes.
• Only self-generated tips are exempt. A manager or supervisor may keep tips received directly from a customer for service they personally and solely provided, such as tending bar alone during a shift.
• Pooled tips remain off-limits. Pooled or shared tips cannot be distributed to a manager or supervisor, even when that individual assisted with tipped work during the shift.
• Potential liability can increase quickly. Employers risk both repayment of improperly retained tips and loss of the tip credit, significantly increasing potential wage liability.

When Can Employees Volunteer for Their Employer? DOL Clarifies FLSA Limits (FLSA2026-12)

A nonprofit that breeds and trains service dogs asked whether exempt veterinarians, trainers, and directors could volunteer, unpaid, to raise puppies at home. The DOL analyzed whether the volunteer activities were the same as, or similar to, the employees’ regular job duties. The answer depended on the employee’s role.

• Veterinarians and directors could volunteer. Their paid duties, medical care, and supervision differ sufficiently from hands-on puppy care and socialization.
• Trainers could not volunteer for the same work. Training and socializing canines is what they’re already paid to do, making the “volunteer” hours indivisible from their employment.
• Volunteering must be truly voluntary. If employees feel pressured to participate or reasonably expect compensation, the time may be treated as compensable work regardless of how the arrangement is described.
• Overlapping duties don’t automatically cost an exemption. If an exempt employee’s primary duty remains exempt work, no extra pay is generally owed even where some volunteer-labeled hours turn out to be compensable.

What the DOL Opinion Letters Mean for Employers

Although the opinion letters address very different workplace issues, they share a common theme: the DOL continues to focus on what employees actually do rather than on job titles, labels, or contractual descriptions. Whether evaluating meal periods, tip sharing arrangements, or volunteer programs, employers should focus on the substance of the working relationship and regularly review their practices for compliance with current wage and hour guidance.

Employer Action Items

1. Audit meal period practices where employees must travel to a designated break area and confirm they still have sufficient time to take a meaningful, uninterrupted meal break.
2. Before allowing a shift lead, shift supervisor, or similar hybrid-role employee to participate in a tip pool or receive tip-outs, evaluate the employee’s actual duties rather than relying on job title alone.
3. Maintain records that distinguish tips managers earn directly from customers through their own service from any pooled or shared tip distributions.
4. For nonprofit volunteer programs, compare proposed volunteer activities to each employee’s regular job duties before permitting unpaid participation and document that participation is voluntary.
5. Consult counsel before allowing exempt employees to perform unpaid activities that overlap with their regular job responsibilities, particularly where wage & hour exposure may result.