For the second time, a federal trial court in Texas has rejected an attempt by the restaurant industry to block enforcement of revised tip credit regulations issued by the Biden Administration’s Labor Department. The trial court’s latest ruling in Restaurant Law Center v. DOL, W.D. Tex. (July 6, 2023), comes after the U.S. Court of Appeals for the Fifth Circuit reversed the first ruling and sent the case back for further consideration. On remand, the trial court concluded that the revised tip credit rule is a permissible construction of the Fair Labor Standards Act (FLSA) and that the rule is neither arbitrary nor capricious, rejecting the association’s claim that it would cause irreparable harm to the restaurant industry if not enjoined.
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