# DOL Withdraws Tipped-Worker Guidance

The US Department of Labor’s Wage and Hour Division withdrew three opinion letters that underpinned the 80/20 guidance for tipped workers after the US Court of Appeals for the Fifth Circuit vacated a Biden-era rule. The change may reduce federal time-based restrictions on employers’ use of the tip credit, but the signal does not specify how individual contracts or state requirements are affected. Government contractors with tipped employees should review the federal and state wage rules applicable to their workforce; the signal identifies no new procurement opportunity or contract award.

- Contractors employing tipped workers should reassess how they apply the tip credit against current federal requirements, since the opinion letters supporting the 80/20 guidance have been withdrawn.
- Because the signal does not address state-law obligations, employers should separately review applicable state and local requirements before changing pay practices.

**Jurisdictions:** federal
**Topics:** Regulatory Compliance
**Published:** October 19, 2026

### Government Entities
- US Department of Labor (DOL)
- Wage and Hour Division (WHD)
- US Court of Appeals for the Fifth Circuit (Fifth Circuit)