1     
MINIMUM WAGE AMENDMENTS

2     
2022 GENERAL SESSION

3     
STATE OF UTAH

4     
Chief Sponsor: Clare Collard

5     
Senate Sponsor: ____________

6     

7     LONG TITLE
8     General Description:
9          This bill amends the Utah Minimum Wage Act regarding the minimum wage for a
10     tipped employee.
11     Highlighted Provisions:
12          This bill:
13          ▸     requires an employer to pay a tipped employee at least the minimum wage without
14     the computation of a cash wage obligation and tips or gratuities; and
15          ▸     makes technical and conforming changes.
16     Money Appropriated in this Bill:
17          None
18     Other Special Clauses:
19          None
20     Utah Code Sections Affected:
21     AMENDS:
22          34-40-102, as last amended by Laws of Utah 2016, Chapter 370
23          34-40-104, as last amended by Laws of Utah 2008, Chapter 382
24     

25     Be it enacted by the Legislature of the state of Utah:
26          Section 1. Section 34-40-102 is amended to read:
27          34-40-102. Definitions -- Joint employees -- Franchisors.
28          (1) Subject to Subsection (3), this chapter and the terms used in it, including the
29     computation of wages, shall be interpreted consistently with the Fair Labor Standards Act of
30     1938, 29 U.S.C. Sec. 201 et seq., as amended, to the extent that act relates to the payment of a
31     minimum wage.
32          (2) As used in this chapter:
33          [(a) "Cash wage obligation" means an hourly wage that an employer pays a tipped
34     employee regardless of the tips or gratuities a tipped employee receives.]
35          [(b)] (a) "Commission" means the Labor Commission created in Section 34A-1-103.
36          [(c)] (b) "Division" means the Division of Antidiscrimination and Labor in the
37     commission.
38          [(d)] (c) "Federal executive agency" means an executive agency, as defined in 5 U.S.C.
39     Sec. 105, of the federal government.
40          [(e)] (d) "Franchise" means the same as that term is defined in 16 C.F.R. Sec. 436.1.
41          [(f)] (e) "Franchisee" means the same as that term is defined in 16 C.F.R. Sec. 436.1.
42          [(g)] (f) "Franchisor" means the same as that term is defined in 16 C.F.R. Sec. 436.1.
43          [(h)] (g) "Minimum wage" means the state minimum hourly wage for an adult
44     [employees] employee as established under this chapter, unless the context clearly indicates
45     otherwise.
46          [(i)] (h) "Tipped employee" means an employee who customarily and regularly
47     receives tips or gratuities.
48          (3) Notwithstanding Subsection (1), for purposes of determining whether two or more
49     persons are considered joint employers under this chapter, an administrative ruling of a federal
50     executive agency may not be considered a generally applicable law unless that administrative
51     ruling is determined to be generally applicable by a court of law, or adopted by statute or rule .
52          (4) (a) For purposes of this chapter, a franchisor is not considered to be an employer of:
53          (i) a franchisee; or
54          (ii) a franchisee's employee.
55          (b) With respect to a specific claim for relief under this chapter made by a franchisee or
56     a franchisee's employee, this Subsection (4) does not apply to a franchisor under a franchise
57     that exercises a type or degree of control over the franchisee or the franchisee's employee not
58     customarily exercised by a franchisor for the purpose of protecting the franchisor's trademarks
59     and brand.
60          Section 2. Section 34-40-104 is amended to read:
61          34-40-104. Exemptions -- Tipped employees.
62          (1) [The] Unless the individual is entitled to a minimum wage under the Fair Labor
63     Standards Act of 1938, 29 U.S.C. Sec. 201 et seq., as amended, the minimum wage established
64     in this chapter does not apply to:
65          [(a) any employee who is entitled to a minimum wage as provided in 29 U.S.C. Sec.
66     201 et seq., the Fair Labor Standards Act of 1938, as amended;]
67          [(b)] (a) an outside sales [persons] person;
68          [(c)] (b) an employee who is a member of the employer's immediate family;
69          [(d)] (c) companionship service for [persons] a person who, because of age or
70     infirmity, [are] is unable to care for [themselves] his or herself;
71          [(e)] (d) a casual and domestic [employees] employee as defined by the commission;
72          [(f)] (e) a seasonal [employees] employee of a nonprofit camping [programs] program,
73     religious or recreation [programs, and] program, or nonprofit educational and charitable
74     [organizations] organization registered under Title 13, Chapter 22, Charitable Solicitations Act;
75          [(g)] (f) an individual employed by the United States of America;
76          [(h)] (g) [any] a prisoner employed through the penal system;
77          [(i)] (h) [any] an employee employed in agriculture if the employee:
78          (i) is principally engaged in the range production of livestock;
79          (ii) is employed as a harvest laborer and is paid on a piece rate basis in an operation
80     that has been and is generally recognized by custom as having been paid on a piece rate basis in
81     the region of employment;
82          (iii) was employed in agriculture less than 13 weeks during the preceding calendar
83     year; or
84          (iv) is a retired or semiretired person performing part-time or incidental work as a
85     condition of the employee's residence on a farm or ranch;
86          [(j)] (i) a registered [apprentices or students] apprentice or student employed by the
87     educational institution in which [they are] the apprentice or student is enrolled; or
88          [(k)] (j) [any] a seasonal hourly employee employed by a seasonal amusement
89     establishment with permanent structures and facilities if the other direct monetary
90     compensation from tips, incentives, commissions, end-of-season bonus, or other forms of pay
91     is sufficient to cause the average hourly rate of total compensation for the season of seasonal
92     hourly employees who continue to work to the end of the operating season to equal the
93     applicable minimum wage if the seasonal amusement establishment:
94          (i) does not operate for more than seven months in any calendar year; or
95          (ii) during the preceding calendar year [its] the seasonal amusement establishment's
96     average receipts for any six months of that year were not more than 33-1/3% of [its] the
97     seasonal amusement establishment's average receipts for the other six months of that year.
98          (2) (a) [Persons] A person with a disability whose earnings or productive capacities are
99     impaired by age, physical or mental deficiencies, or injury may be employed at wages that are
100     lower than the minimum wage, provided the wage is related to the employee's productivity.
101          (b) The commission may establish and regulate the wages paid or wage scales for
102     persons with a disability.
103          (3) The commission may establish or may set a lesser minimum wage for learners not
104     to exceed the first 160 hours of employment.
105          (4) (a) An employer of a tipped employee shall pay the tipped employee at least the
106     minimum wage established by this chapter without considering tips or gratuities the tipped
107     employee receives.
108          [(b) In computing a tipped employee's wage under this Subsection (4), an employer of
109     a tipped employee:]
110          [(i) shall pay the tipped employee at least the cash wage obligation as an hourly wage;
111     and]
112          [(ii) may compute the remainder of the tipped employee's wage using the tips or
113     gratuities the tipped employee actually receives.]
114          [(c)] (b) An employee shall retain all tips and gratuities except to the extent that the
115     employee participates in a bona fide tip pooling or sharing arrangement with other tipped
116     employees.
117          [(d) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act,
118     the commission shall by rule establish the cash wage obligation in conjunction with its review
119     of the minimum wage under Section 34-40-103.]