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09.12.41 - Division of Labor and Industry - Proposed Regulations



09.12.41 Wage and Hour Law

Labor and Employment Article, §§2-106(c),[ and] 3-410, and 3-419, Annotated Code of Maryland

Notice of Proposed Action

The Commissioner of Labor and Industry proposes to amend Regulation .19, adopt new Regulation .20, and recodify existing Regulations .20—.23 to be Regulations .21—.24 under COMAR 09.12.41 Wage and Hour Law. This action was considered at a public hearing held on August 15, 2019, notice of which was given in 46:15 Md. R. 664 (July 19, 2019), pursuant to General Provisions Article, §3-302(c)(1), and Labor and Employment Article, §2-106(c)(1), Annotated Code of Maryland.

Statement of Purpose

The purpose of this action is to adopt regulations to require restaurant employers who utilize a tip credit to provide employees with a written or electronic wage statement. This action is to address the requirements of Chs. 10 and 11 (H.B. 166 and S.B. 280), Acts of 2019, which amended the Wage and Hour Law to require the Commissioner to adopt regulations requiring restaurant employers of certain tipped employees to receive a wage statement that shows the effective hourly rate of pay.

Comparison to Federal Standards

There is no corresponding federal standard to this proposed action.

Estimate of Economic Impact

The proposed action has no economic impact.

Economic Impact on Small Businesses

The proposed action has minimal or no economic impact on small businesses.

Impact on Individuals with Disabilities

The proposed action has no impact on individuals with disabilities.

Opportunity for Public Comment

Comments may be sent to Michelle F. Vanreusel, Regulatory and Grants Coordinator, Department of Labor, 1100 North Eutaw Street, Room 600, Baltimore, MD 21201, or call 410-767-2225, or email to, or fax to 410-767-2986. Comments will be accepted through January 6, 2019. A public hearing has not been scheduled.

.19 Regular Hourly Rate.
  A.—D. (text unchanged)
  E. The following amounts are not included in determining the regular hourly rate:
    (1)—(4) (text unchanged)
    (5) Contributions irrevocably made by an employer to a trustee or third person under a bona fide retirement, insurance, or similar employee benefit plan; [and]
    (6) Extra compensation paid at a premium rate pursuant to a statutorily valid employer-employee agreement[.]; and
    (7) Tips received by the employee in excess of the tip credit.

.20 Restaurant Tip Credit Wage Statement.
  A. Definitions.
    (1) In this regulation, the following terms have the meanings indicated.
    (2) Terms Defined.
      (a) “Reported tips” means tips retained by the employee and disclosed to the employer, tips distributed to the employee by the employer, or tips obtained through a valid tip pooling arrangement or tip sharing arrangement.
      (b) “Restaurant” has the meaning stated in Regulation .07D of this chapter.
      (c) “Tip credit wage statement” means a written or electronic statement that shows the employee’s effective hourly rate of pay, including employer paid cash wages plus all reported tips, for all tip credit hours worked for each workweek in the pay period.
  B. No later than 2 weeks following the end of the pay period, a restaurant employer shall provide each employee for whom the employer utilizes a tip credit with a tip credit wage statement for each pay period that reflects all reported tips for tip credit hours for each workweek of the pay period.
  C. A restaurant employer may satisfy the requirement in §B of this regulation by providing an online system through which an employee may obtain the employee’s tip credit wage statement.

Commissioner of Labor and Industry