Small Business Flexibility Act

The Small Business Flexibility Act aims to modify the Fair Labor Standards Act of 1938, specifically concerning the rules for tip pooling among employees. This legislation seeks to broaden the categories of workers who can participate in a tip pool, moving beyond the current restriction to only those who customarily and regularly receive tips. Under the proposed changes, employers would be permitted to include employees who do not customarily and regularly receive tips in a tip pool. This expanded flexibility is contingent upon the employer paying employees who customarily receive tips a direct cash wage that is at least equal to the federal minimum wage, rather than the lower tipped minimum wage.