Case: 23-50562 Document: 100-1 Page: 1 Date Filed: 10/29/2024
`
`United States Court of Appeals
`for the Fifth Circuit
`____________
`
`No. 23-50562
`____________
`
`Restaurant Law Center; Texas Restaurant Association,
`
`
`United States Court of Appeals
`Fifth Circuit
`
`FILED
`August 23, 2024
`Lyle W. Cayce
`Clerk
`
`Plaintiffs—Appellants,
`
`
`
`versus
`
`
`United States Department of Labor; Julie A. Su, Acting
`Secretary, U.S. Department of Labor; Jessica Looman, Acting
`Administrator of the Department of Labor’s Wage and Hour Division, in her
`official capacity,
`
`
`Defendants—Appellees.
`______________________________
`
`
`
`
`
`Appeal from the United States District Court
`for the Western District of Texas
`USDC No. 1:21-CV-1106
`______________________________
`
`ON PETITION FOR PANEL REHEARING
`
`
`Before Elrod, Chief Judge, Graves, Circuit Judge, and Ashe, District
`Judge.*
`Jennifer Walker Elrod, Chief Judge:
`
`_____________________
`
`* United States District Judge for the Eastern District of Louisiana, sitting by
`designation.
`
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`IT IS ORDERED that the Appellees’ petition for panel rehearing
`is GRANTED. We withdraw the opinion previously filed in this case on
`August 23, 2024, and substitute it with the following opinion.
`
`The Restaurant Law Center and the Texas Restaurant Association
`challenge a final rule promulgated by the Department of Labor that restricts
`when employers may claim a “tip credit” for “tipped employees” under the
`Fair Labor Standards Act. The Administrative Procedure Act requires us to
`hold unlawful and set aside agency actions that are “arbitrary, capricious, an
`abuse of discretion, or otherwise not in accordance with law.” 5 U.S.C. §
`706(2)(A). The Final Rule fails under the Administrative Procedure Act
`twice over. Because the Final Rule is contrary to the Fair Labor Standards
`Act’s clear statutory text, it is not in accordance with law. And because it
`imposes a line-drawing regime that Congress did not countenance, it is
`arbitrary and capricious.
`
`I
`
`A
`
`The Fair Labor Standards Act permits employers to take what is
`commonly called a “tip credit” when paying the wages of any “tipped
`employee.” 29 U.S.C. § 203(m)(2)(A). The tip credit enables the employer
`to pay tipped employees $2.13 per hour—significantly below the current
`minimum wage of $7.25 per hour—under the theory that a large portion of
`such employees’ total earnings comes from tips. The FLSA still requires that
`an employee’s tips make up the difference between the $2.13 wage and the
`general minimum wage. If that difference does not end up being covered by
`tips, then the employer must pay the remainder to ensure that the tipped
`employee makes at least the minimum wage. 29 U.S.C. § 203(m); Montano
`v. Montrose Rest. Assocs., Inc., 800 F.3d 186, 188 (5th Cir. 2015).
`
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`The FLSA defines a “tipped employee” as “any employee engaged
`
`in an occupation in which he customarily and regularly receives more than
`$30 a month in tips.” 29 U.S.C. § 203(t).
`
`“DOL is authorized to promulgate rules interpreting and clarifying
`
`the FLSA.” Montano, 800 F.3d at 190. The tip credit has long been the
`subject of interpretation by DOL. In 1967, the year after Congress amended
`the FLSA to include the tip credit, DOL issued its “dual-jobs” regulation,
`which addressed situations where an employee regularly engages in distinct
`occupations for the same employer. For example, “where a maintenance
`man in a hotel also serves as a waiter,” that employee “is a tipped employee
`only with respect to his employment as a waiter. He is employed in two
`occupations.” 29 C.F.R. § 531.56(e) (1967–2021). The regulation contrasted
`this example with that of “a waitress who spends part of her time cleaning
`and setting tables, toasting bread, making coffee and occasionally washing
`dishes or glasses.” For the latter employee, “[s]uch related duties in an
`occupation that is a tipped occupation need not by themselves be directed
`toward producing tips.” Id.
`
`Presumably concerned that employers might, as the district court put
`
`it, exploit the tip credit to “subsidize non-tipped work and pay employees
`less across the board,” DOL issued several opinion letters from 1979 to 1985
`interpreting the dual-jobs regulation to more significantly restrict the tip
`credit’s availability. In 1988, DOL published its so-called 80/20 guidance in
`its sub-regulatory Field Operations Handbook. 86 Fed. Reg. 60,114, 60,116.
`The 80/20 guidance provided that a maximum of 20 percent of an
`employee’s time could be spent on non-tipped activities related to the tipped
`occupation—for example, a waitress setting tables or making coffee—for the
`employer to claim the full tip credit.
`
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`DOL’s 80/20 guidance persisted uninterrupted until 2009, when
`DOL’s interpretation of the dual-jobs regulation began to oscillate with every
`change in presidential administration. First, in early 2009, a DOL opinion
`letter briefly rescinded the guidance. This opinion letter, in turn, was quickly
`withdrawn in the early days of the Obama Administration. See 86 Fed. Reg.
`60,114, 60,117. Then, in 2018, the Trump Administration reissued the 2009
`opinion letter, thereby doing away with the 80/20 guidance once again. And
`in 2020, DOL issued a final rule set to take effect in March 2021 that would
`have amended 29 C.F.R. § 531.56(e). This rule would have permitted
`employers to claim the tip credit for all non-tipped duties that its tipped
`employees performed, so long as those duties were related to the employee’s
`tipped occupation and were performed reasonably contemporaneously with
`tipped duties. 85 Fed. Reg. 86,756, 86,767. But the rule never took effect.
`
`
`Instead, another change in presidential administration swept in
`another change in DOL policy. In December 2021, DOL issued a different
`final rule after notice and comment that effectively codified its longstanding
`80/20 guidance. The Final Rule added a new subsection (f) to 29 C.F.R.
`§ 531.56, explaining what it means to be “engaged in a tipped occupation”
`under 29 U.S.C. § 203(t). Notably, “tipped occupation” is not a term used
`in § 203(t) of the FLSA. According to the Final Rule, an employee is
`“engaged in a tipped occupation when the employee performs work that is
`part of the tipped occupation.” 29 C.F.R. § 531.56(f) (2021). Therefore,
`“[a]n employer may only take a tip credit for work performed by a tipped
`employee that is part of the employee’s tipped occupation.” Id.
`
`The Final Rule then proceeds to define three categories of work: (1)
`directly tip-producing work (e.g., a server “providing table service”); (2)
`directly supporting work (e.g., a server “setting and bussing tables”); and (3)
`work not part of the tipped occupation (e.g., a server “preparing food”). Id.
`An employer may take the tip credit for tip-producing work. But if more than
`
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`20 percent of an employee’s workweek is spent on directly supporting work,
`the employer cannot claim the tip credit for that excess. Nor can directly
`supporting work be performed for more than 30 minutes at any given time.1
`An employer may not take the tip credit for any time spent on work not part
`of the tipped occupation. In addition, the Final Rule amended the 1967 dual-
`jobs regulation to omit the counterexample of a waitress engaging in duties
`related to her occupation. Compare 29 C.F.R. § 531.56(e) (2021) with id.
`(1967–2021).
`
`The Restaurant Law Center and the Texas Restaurant Association
`
`filed this lawsuit in December 2021 in the Western District of Texas, seeking
`to permanently enjoin DOL’s enforcement of the Final Rule. The
`Associations moved for a preliminary injunction, which the district court
`denied on the ground that the Associations would not suffer irreparable
`harm. On appeal, this court reversed and remanded, holding that the
`Associations had sufficiently shown irreparable harm, and instructed the
`district court to consider the other prongs of the preliminary injunction
`analysis. Rest. L. Ctr. v. U.S. Dep’t of Lab., 66 F.4th 593, 600 (5th Cir. 2023).
`
`On remand, the district court considered and entered final judgment
`
`on both the motion for a preliminary injunction and on two dueling motions
`for summary judgment that the parties had filed while the appeal was
`pending. The court evaluated the merits of the Associations’ claims, relevant
`to resolving all three motions, in a single order. Concluding that the Final
`Rule was a permissible interpretation of an ambiguous statutory term—
`“engaged
`in an occupation”—the district court held that DOL’s
`interpretation was entitled to deference under Chevron USA Inc. v. Natural
`
`_____________________
`
`1 The 30-minute requirement is new to the Final Rule and has no analog in DOL’s
`previous 80/20 guidance.
`
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`Resources Defense Council, Inc., 467 U.S. 837 (1984). In addition, the district
`court held that the Final Rule was neither arbitrary nor capricious, and was
`not subject to the major questions doctrine as expounded by the Supreme
`Court in West Virginia v. EPA, 597 U.S. 697 (2022). The district court
`therefore denied the Associations’ motions for a preliminary injunction and
`summary judgment and granted DOL’s motion for summary judgment.
`
`The Associations timely appealed, challenging only the district
`
`court’s summary judgment rulings. Shortly following oral argument in this
`case, the Supreme Court overruled Chevron, instructing that courts “may not
`defer to an agency interpretation of the law simply because a statute is
`ambiguous.” Loper Bright Enters. v. Raimondo, 144 S. Ct. 2244, 2273 (2024).
`
`B
`
`Before turning to the merits of this case, it is helpful to survey several
`
`opinions from our sister circuits that figure prominently in both parties’
`arguments here. While we appear to be the first circuit court to confront the
`permissibility of the Final Rule under the FLSA, several other circuits have
`previously examined DOL’s preexisting guidance upon which the Final Rule
`is modeled.
`
`Most notably, the parties direct our attention to the en banc Ninth
`Circuit’s opinion in Marsh v. J. Alexander’s LLC, 905 F.3d 610 (9th Cir.
`2018) (en banc). In that case, a server filed a lawsuit against his former
`employer, claiming that he was entitled to the full minimum wage for time
`spent on untipped work under the FLSA, the dual-jobs regulation, and
`DOL’s subsequent sub-regulatory guidance. Id. at 615–17. The Ninth
`Circuit agreed that the server had adequately stated a claim for relief, holding
`that: (1) the FLSA’s tip-credit provision was ambiguous and the dual-jobs
`regulation was a permissible construction of the provision under Chevron;
`and (2) the dual-jobs regulation was itself ambiguous and DOL’s subsequent
`
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`sub-regulatory guidance was a permissible construction of the regulation
`under Auer v. Robbins, 519 U.S. 452, 461 (1997). Marsh, 905 F.3d at 621–23,
`625–32.
`
`Judge Graber concurred in part and dissented in part. She wrote that
`DOL’s guidance, at least as it related to a 20 percent cap on “related but non-
`tipped work” should not have received Auer deference. Id. at 634 (Graber,
`J., concurring in part and dissenting in part). She pointed out that the dual-
`jobs regulation asks “whether the employee performs tasks unrelated to his
`or her tipped occupation” and has “nothing to do with the amount of time
`that an employee spends engaged in non-tipped tasks related to the tipped
`occupation.” Id. at 635. Therefore, a server performing untipped tasks
`related to her occupation as a server is “not performing two jobs” under the
`dual-jobs regulation. Id. at 635–36.
`
`Judge Ikuta, joined by Judge Callahan, dissented. She likewise would
`not have applied Auer deference to DOL’s sub-regulatory guidance, which
`she called a “purely . . . legislative rule,” rather than an interpretive rule,
`which then should have been
`issued through notice-and-comment
`rulemaking. Id. at 648 (Ikuta, J., dissenting). The 20-percent cap on non-
`tipped work, she wrote, “effectively disregards” the dual-jobs regulation’s
`delineation between an employee employed in two distinct jobs and one
`employed in a single job performing a range of tasks. Id. at 645. “There is
`no job that can be described as more-than-20-percent-of-time-spent-on-
`untipped-related tasks, nor is there a job that can be described as the five or
`ten minutes spent here and there on unrelated tasks.” Id. And while not
`directly opining on the permissibility of the sub-regulatory guidance under
`the FLSA itself, Judge Ikuta noted that the guidance “eviscerates the
`statutory tip credit” and “eliminates the benefit conferred on employers by
`Congress.” Id. at 649, 652.
`
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`The Ninth Circuit’s Marsh opinion followed the Eighth Circuit’s
`
`earlier opinion in Fast v. Applebee’s International, Inc., which likewise held
`that DOL’s sub-regulatory guidance was entitled to Auer deference, and that
`it was a permissible interpretation of the dual-jobs regulation. 638 F.3d 872,
`872–80 (8th Cir. 2011).
`
`Finally, in Rafferty v. Denny’s, Inc., the Eleventh Circuit examined the
`
`Trump Administration’s 2018 sub-regulatory guidance, which had rescinded
`the 80/20 guidance. 13 F.4th 1166, 1179–80 (11th Cir. 2021). The court
`declined to extend Auer deference to the 2018 guidance, concluding that
`although the dual-jobs regulation was ambiguous, the 2018 guidance was not
`a reasonable interpretation of the regulation. Id. at 1185.
`
`Judge Luck concurred in the result. He agreed with the majority that
`
`the 2018 guidance was not entitled to deference, but he would have directed
`the district court to “apply the unambiguous text of the dual jobs regulation
`instead of the Department of Labor’s opinion letters purporting to interpret
`the regulation.” Id. at 1195 (Luck, J., concurring in the result). The dual-
`jobs regulation states that tipped employees may “occasionally” perform
`non-tipped duties. Id. at 1200 (quoting 29 C.F.R. § 531.56(e)). This term,
`Judge Luck observed, has a “plain and ordinary meaning[].” Id. It simply
`means that non-tipped duties “can’t take up most of the employee’s time”:
`“‘occasionally’ doesn’t mean ten or twenty percent or any other specific
`percent.” Id. at 1201.
`
`Because none of these opinions addressed the validity of the Final
`
`Rule as an interpretation of the FLSA, they do not directly bear upon the
`question that we are confronted with here. Nonetheless, they show that
`courts have long been wrangling with the tip credit and DOL’s regulation
`thereof. And they can be helpful in illuminating the best reading of the FLSA.
`
`II
`
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`We review a district court’s ruling on a motion for summary judgment
`de novo. W & T Offshore, Inc. v. Bernhardt, 946 F.3d 227, 233 (5th Cir. 2019).
`Summary judgment is appropriate when “there is no genuine dispute as to
`any material fact and the movant is entitled to judgment as a matter of law.”
`Fed. R. Civ. P. 56(a). “When cross-motions for summary judgment have
`been ruled upon, we review each party’s motion independently, viewing the
`evidence and inferences in the light most favorable to the nonmoving party.”
`W & T, 946 F.3d at 233 (citation and internal quotation marks omitted).
`
`Here, we are tasked with evaluating the permissibility of the 2021
`
`Final Rule under the FLSA. The APA directs courts to hold unlawful and
`set aside agency actions that are “arbitrary, capricious, an abuse of discretion,
`or otherwise not in accordance with law.” 5 U.S.C. § 706(2)(A).
`
`III
`
`A
`
`In conducting review of an agency’s action under the APA, the “court
`shall decide all relevant questions of law” and “interpret . . . statutory
`provisions.” Id. § 706. “The APA thus codifies for agency cases the
`unremarkable, yet elemental proposition reflected by judicial practice dating
`back to Marbury: that courts decide legal questions by applying their own
`judgment.” Loper Bright, 144 S. Ct. at 2261.
`
`Our task was once different under the now-ancien régime that Chevron
`
`imposed. Under Chevron, a court reviewing agency action for compliance
`with the relevant statute had to defer to “permissible” agency
`interpretations, “even if not ‘the reading the court would have reached if the
`question initially had arisen in a judicial proceeding.’” Id. at 2264 (quoting
`Chevron, 467 U.S. at 843 n.11). The doctrine was often conceptualized as
`proceeding in three distinct steps. At “Step Zero,” the reviewing court
`determined whether the agency interpretation in question was authoritative.
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`Ali v. Barr, 951 F.3d 275, 278–79 (5th Cir. 2020). At “Step One,” the court
`asked whether the statutory provision was unambiguous, in which case any
`contrary agency interpretation would be disregarded. Mexican Gulf Fishing
`Co. v. U.S. Dep’t of Com., 60 F.4th 956, 963 (5th Cir. 2023) (quoting Huawei
`Techs. USA, Inc. v. FCC, 2 F.4th 421, 433 (5th Cir. 2021)).
`
`But if the statute was “silent or ambiguous as to the specific issue,”
`then at “Step Two” the court asked whether the agency’s interpretation was
` Id. (quoting Huawei
`“a permissible construction of the statute.”
`Technologies, 2 F.4th at 433). In short, a court was “obliged to accept the
`agency’s position if Congress ha[d] not previously spoken to the point at
`issue and the agency’s interpretation [was] reasonable.” United States v.
`Mead Corp., 533 U.S. 218, 229 (2001).
`
`The Chevron doctrine proved controversial, and many called for it to
`
`be reconsidered. See, e.g., Gutierrez-Brizuela v. Lynch, 834 F.3d 1142, 1149–
`58 (10th Cir. 2016) (Gorsuch, J., concurring) (critiquing Chevron under
`separation of powers principles and the text of the APA). But as we were
`bound to do, we continued to “name Chevron, and apply its precedent—until
`and unless it [was] overruled by our highest Court.” Mexican Gulf Fishing
`Co., 60 F.4th at 963 n.3.
`
`The Supreme Court has now done so. “Chevron is overruled.” Loper
`
`Bright, 144 S. Ct. at 2273. In its place, the Court has instructed that we are
`to return
`to
`the APA’s basic
`textual command: “independently
`interpret[ing] the statute and effectuat[ing] the will of Congress.” Id. at
`2263. Courts are constantly faced with statutory ambiguities and genuinely
`hard cases.
` But “instead of declaring a particular party’s reading
`‘permissible’ in such a case, courts use every tool at their disposal to
`determine the best reading of the statute and resolve the ambiguity.” Id. at
`2266.
`
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`B
`
`Following the Supreme Court’s instructions, and without the
`
`guidance of Chevron, we turn now to our task. While the district court was of
`course correct to apply the Chevron framework at the time of its decision, the
`Supreme Court’s intervening opinion in Loper Bright requires us to depart
`from the district court’s analysis at the very start. We must parse the text of
`the FLSA using the traditional tools of statutory interpretation. As the
`district court correctly put it, “[t]he dispute in this case turns on the meaning
`of the statutory phrase ‘engaged in an occupation’ and the term
`‘occupation,’ both of which are used in the definition of ‘tipped employee’
`but are undefined in the FLSA.”
`
`“As usual, we start with the statutory text.” Tanzin v. Tanvir, 592
`U.S. 43, 46 (2020). Terms that the statute leaves undefined should be given
`their “ordinary, contemporary, common meaning.” Contender Farms, LLP
`v. U.S. Dep’t of Agric., 779 F.3d 258, 269 (quoting Wilderness Soc’y v. U.S.
`Fish & Wildlife Serv., 353 F.3d 1051, 1060 (9th Cir. 2003)). Section 203(t)’s
`text is simple. A “tipped employee” means “any employee engaged in an
`occupation in which he customarily and regularly receives more than $30 a
`month in tips.” 29 U.S.C. § 203(t) (emphasis added).
`
`Because the FLSA defines neither “engaged in” nor “occupation,”
`the ordinary meaning of these terms in 1966, when the tip credit was added
`to the FLSA, controls. See Contender Farms, 779 F.3d at 269. We turn first
`to contemporary dictionary definitions. See Taniguchi v. Kan Pacific Saipan,
`Ltd., 566 U.S. 560, 566–69 (2012).
`
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`Start with the word “engaged.” Several cited contemporary
`dictionaries define it as: (1) “occupied; employed”;2 (2) “busy or occupied;
`involved”;3 and (3) “to employ or involve oneself.”4
`
`And as for “occupation,” those same dictionaries define that term as:
`(1) “the principal business of one’s life: a craft, trade, profession, or other
`means of earning a living: employment; vocation <his occupation is
`farming>”;5 (2) “one’s usual or principal work or business, esp. as a means
`of earning a living: His occupation was dentistry”;6 and (3) “Vocation. That
`which principally takes up one’s time, thought, and energies; especially,
`one’s regular business or employment; also whatever one follows as the
`means of making a livelihood.”7
`
`The Associations are correct that “engaged in an occupation” most
`naturally indicates a focus “on the field of work and the job as a whole,”
`
`_____________________
`
`2 1 Webster’s Third New International Dictionary 751 (1961 ed.).
`3 The Random House Dictionary of the English Language 473 (1967 ed.).
`4 Engage, Black’s Law Dictionary 622 (4th ed. 1957).
`5 2 Webster’s Third New International Dictionary, supra note 2, at 1560. While at
`least one esteemed jurist might have looked askance at the use of Webster’s Third, MCI
`Telecomms. Corp. v. American Tel. & Tel. Co., 512 U.S. 218, 225–28, 228 n.3 (1994), we cite
`this contemporaneous edition here for completeness. In any event, the definitions that
`Webster’s Third offers for both “engaged” and “occupation” did not significantly change
`from previous editions. See Webster’s Second New International Dictionary 847 (1958 ed.)
`(defining “engaged” as “occupied; employed”); id. at 1684 (defining occupation as “[t]hat
`which occupies, or engages, the time and attention; the principal business of one’s life;
`vocation; business”).
`6 The Random House Dictionary of the English Language, supra note 3, at 996.
`7 Occupation, Black’s Law Dictionary, supra note 4, at 1230.
`
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`rather than on specific tasks. In other words, “engaged in an occupation”
`closely resembles “employed in a job.”8
`
`But this conclusion does not alone resolve the question. Indeed, DOL
`appears to fully acknowledge that “occupation” must refer to the entire job.
`Rather, DOL points out that an employee is not truly “engaged in” his
`occupation (or job) if he is not performing the customary duties associated
`with that occupation. In other words, DOL shifts the focus from
`“occupation” to “engaged in.” From there, DOL further argues that
`“engaged in” must have some nexus to whether an employee’s duties relate
`to the pursuit of tips—the characteristic with which Congress was
`supposedly concerned.
`
`While initially plausible, DOL’s argument rests on an ambiguity of its
`own making. Section 203(t) is silent, DOL maintains, as to when an
`employee is truly engaged in her occupation. The FLSA, the argument goes,
`therefore confers on DOL the authority to make that determination by
`reference to whether an employee is in any given moment pursuing tips (or,
`with a small allowance, directly supporting that pursuit). We cannot agree.
`
`_____________________
`
`8 There is no other fair way to read these terms in the context of § 203(t). To read
`“occupation” as meaning something closer to “activity” or “duty” would lead to curious
`results. It would necessarily mean that § 203(t)’s $30-per-month threshold would apply
`separately to every discrete genre of duty that an employee may perform, rather than simply
`to that employee’s job as a whole. A server’s employer would need to determine when the
`server had crossed that threshold and earned $30 in tips for, to name a few examples, taking
`orders, delivering food, folding silverware into napkins, and singing “Happy Birthday” to
`patrons. Putting aside the obvious line-drawing problem, giving tips to an employee based
`on each individual activity that the employee performs is simply not how tipping works in
`practice. One occupation, one $30-per-month requirement. That § 203(t)’s use of the
`term “occupation” refers to individual discrete activities, rather than to the job as a whole
`is, we think, highly unlikely.
`
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`At the threshold, and as explained above, “engaged in” means, inter
`alia, “employed.” DOL does not address this fact, taking for granted that to
`be “engaged in an occupation” must mean something more granular than
`simply to be “employed in a job.” We do not see why we should depart from
`the more natural interpretation. Regardless, the logical knots into which
`DOL invites us to tie ourselves further confirms that its interpretation is not
`the best reading of the statute.
`
`DOL’s interpretation sits uncomfortably with the operative statutory
`term: “tipped employee.” Under the Final Rule, if an employee is not
`engaged in her occupation at a given moment, then she is not a “tipped
`employee” at that moment. The Final Rule necessarily means, therefore,
`that when an employee is not engaged in her “tipped occupation,” as the
`regulatory language puts it, she is engaged in some other occupation. Because
`the Final Rule is so granular in divvying up component tasks, a single
`occupation could quickly break apart, implausibly, into many.
`
`As Judge Ikuta put it in Marsh:
`
`[A] waitress doing typical waitress duties remains a waitress,
`even if (in five-minute increments throughout her workweek)
`she spends 60 percent of her time waiting tables, 10 percent
`cleaning tables, 10 percent toasting bread, 10 percent making
`coffee, and 10 percent washing dishes. The dual jobs regula-
`tion—and common sense—tells us that the waitress is 100 per-
`cent engaged in the single tipped occupation of waitressing—
`she is not 60 percent a waitress, 10 percent a janitor, 10 percent
`a baker, 10 percent a barrista [sic], and 10 percent a dishwasher.
`
`905 F.3d at 645 (Ikuta, J., dissenting) (citation omitted). Although Marsh
`examined the validity of DOL’s sub-regulatory guidance rather than that of
`the Final Rule, these observations remain the same. And this conceptual
`difficulty with the 80/20 guidance is even further exacerbated by the Final
`Rule’s additional 30-minute requirement. At minute 31, a server who has
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`been “setting and bussing tables” is no longer engaged in her tipped
`occupation even though the duty itself has not changed. 29 C.F.R. §
`531.56(f)(3)(ii) (describing setting tables as a server’s “directly supporting
`work”). But “the term ‘occupation’ does not mean how often a person
`performs a task.” Marsh, 905 F.3d at 646 (Ikuta, J., dissenting).
`
`This problem is especially driven home by the Final Rule’s treatment
`of idle time. Time that a server spends idle during a slow shift, for example,
`is defined as directly supporting work subject to the 20-percent and 30-
`minute limits. 29 C.F.R. § 531.56(f)(3)(i); 86 Fed. Reg. 60,114, 60,130.
`Therefore, if the server is idly standing by to serve customers for 21 percent
`of his workweek, or for 31 continuous minutes, he is no longer engaged in his
`occupation and is no longer a tipped employee for the duration of that excess
`time. What occupation, then, would he be engaged in? The Final Rule
`creates a paradox that is not obviously capable of resolution.
`
`The Final Rule is attempting to answer a question that DOL itself, not
`the FLSA, has posed. The FLSA is clear: an employer may claim the tip
`credit for any employee who, when “engaged in” her given “occupation . . .
`customarily and regularly receives more than $30 a month in tips.” 29 U.S.C.
`§ 203(t) (emphasis added). The FLSA does not ask whether duties
`composing that given occupation are themselves each individually tip-
`producing.
`
`Put another way, being “engaged in an occupation in which [the
`employee] customarily and regularly receives more than $30 a month in tips”
`cannot be twisted to mean being “engaged in duties that directly produce
`tips, or in duties that directly support such tip-producing duties (but only if
`those supporting duties have not already made up 20 percent of the work
`week and have not been occurring for 30 consecutive minutes) and not
`engaged in duties that do not produce tips.”
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`We do not agree with DOL that our interpretation threatens to read
`“engaged in” out of the statute. This is because “engaged in” still performs
`the work of identifying the occupation in which an employee receives tips. It
`therefore clarifies that the tip credit applies to occupations, rather than, for
`example, to the entire employment relationship even where the employee
`performs the work of two or more occupations. To put a finer point on it, we
`do not hold that § 203(t) can be read as: “‘tipped employee’ means any
`employee who customarily and regularly receives more than $30 a month in
`tips.”
`
`Indeed, it is DOL’s interpretation that threatens to turn the $30-
`threshold requirement into a nullity by focusing instead on individual tasks.
`DOL’s interpretation functionally turns § 203(t) into: “‘tipped employee’
`means any employee who, in a given moment, is engaged in tip-producing
`work.” We conclude that our interpretation of the statutory language is the
`best one because it gives full effect to the entirety of the provision.
`
`We pause to note that, even in the absence of Chevron, courts are well-
`advised to consider agency “interpretations issued contemporaneously with
`the statute at issue, and which have remained consistent over time.” Loper
`Bright, 144 S. Ct. at 2262. As DOL points out, the 80/20 standard (but not
`the 30-minute requirement) is indeed of some vintage, having been applied
`with brief interregna since at least 1988. But while longstanding agency
`practice might have the “power to persuade,” it has never had the “power
`to control.” See Skidmore v. Swift & Co., 323 U.S. 134, 140 (1944). Nor can
`we permit agency practice to “defeat a statute’s text by ‘adverse
`possession.’” Airlines for Am. v. Dep’t of Transp., No. 24-60231, 2024 WL
`3580314, at *3 (5th Cir. July 29, 2024) (quoting Rapanos v. United States, 547
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`U.S. 715, 752 (2006)). We are not persuaded that the 80/20 standard,
`however longstanding, can defeat the FLSA’s plain text.9
`
`As a final point, in no way does our holding bear on the validity of the
`dual-jobs regulation, which is not challenged here. The dual-jobs regulation,
`unlike the Final Rule, does not countenance a percentage-based—much less
`a 30-minute-increment-cutoff-based—approach to identifying how much
`untipped work is too much. See Rafferty, 13 F.4th at 1201 (Luck, J.,
`concurring in the result). Indeed, it focusses on “whether the employee
`performs tasks unrelated to his or her tipped occupation,” not the “amount of
`time” spent on untipped tasks. See Marsh, 905 F.3d at 635 (Graber, J.,
`concurring in part and dissenting in part). It therefore suffers from none of
`the infirmities th