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Romero v. Top-Tier Colorado LLC

United States Court of Appeals, Tenth Circuit

March 7, 2017

AARICA ROMERO, Plaintiff-Appellant,
v.
TOP-TIER COLORADO LLC; RICHARD J. WARWICK, Defendants-Appellees. SECRETARY OF LABOR, Amicus Curiae.

         Appeal from the United States District Court for the District of Colorado (D.C. No. 1:15-CV-02101-MEH)

          Jamie G. Sypulski, Law Office of Jamie Golden Sypulski, Chicago, Illinois (Clifford P. Bendau, II, The Bendau Law Firm, Phoenix, Arizona, Douglas M. Werman, and Sarah J. Arendt, Werman, Salas P.C., with her on the briefs), for Plaintiff-Appellant.

          Gregory E. Givens, Gregory E. Givens Law Offices, Colorado Springs, Colorado, for Defendants-Appellees.

          M. Patricia Smith, Solicitor of Labor, Jennifer S. Brand, Associate Solicitor, Paul L. Frieden, Counsel for Appellate Litigation, and Sarah Kay Marcus, Senior Attorney, U.S. Department of Labor, Washington, D.C., filed a brief for Amicus Curiae.

          Before TYMKOVICH, Chief Judge, BACHARACH and MORITZ, Circuit Judges.

          MORITZ, Circuit Judge.

         In dismissing Aarica Romero's minimum-wage claim under Fed.R.Civ.P. 12(b)(6), the district court relied on a single, undisputed fact: Romero has never alleged that she earned less than the federal minimum wage of $7.25 an hour-at least after taking into account both (1) the cash wage that her employer paid her and (2) all of the tips that she received each week.

         But an employer doesn't comply with its federal minimum-wage obligations just because its employees receive at least $7.25 an hour in tips. Instead, an employer complies with its minimum-wage obligations if it "pay[s]" its employees at least $7.25 an hour in "wages." 29 U.S.C. § 206(a)(1)(C). And while an employer can treat tips as wages under certain circumstances, see id. § 203(m), Romero asserts that her employer impermissibly did so here.

         The district court declined to address this argument. But without first resolving whether Romero's employer was entitled to treat her tips as wages under § 203(m), the district court couldn't have determined whether that employer "pa[id]" Romero "wages" of at least $7.25 an hour under § 206(a)(1)(C). Accordingly, we reverse and remand to the district court to make this threshold determination in the first instance.

         Background

         Romero worked as a server for defendant Top-Tier Colorado LLC (Top-Tier) at one of its restaurants.[1] Rather than directly paying Romero the federal minimum wage of $7.25 an hour, see § 206(a)(1)(C), the defendants instead took advantage of what's known colloquially as the "tip credit": they paid Romero a "cash wage" of $4.98 an hour[2] and then used some of the tips that Romero received to cover the gap between that cash wage and the federal minimum wage, see Fast v. Applebee's Int'l, Inc., 638 F.3d 872, 876 (8th Cir. 2011) (explaining that tip credit "allows the employer to avoid a larger cash payment to the employee as long as the employee's tips make up the difference between $2.13 per hour and the current minimum wage" (citing § 203(m)).

         But the tip credit only applies to "tipped employee[s]." § 203(m). And during some of the hours she worked, Romero performed what she describes as "non-tipped" tasks, e.g.,

brewing tea, brewing coffee, rolling silverware, cleaning soft drink dispensers, wiping down tables, setting tables, busing tables, cutting and stocking fruit, stocking ice, taking out trash, scrubbing walls, sweeping floors, restocking to-go supplies, cleaning booths, cleaning ramekins, sweeping, mopping, ...

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