The Corner

Economy & Business

Congress Does the Right Thing on Tipping

(Leah Millis/Reuters)

Last year I wrote about a proposed rule from the Trump administration that would have deregulated restaurant tipping. Specifically, it would have let restaurants decide how tips are distributed to workers, including to “back of the house” employees such as cooks, so long as all workers were paid at least the minimum wage. The previous administration had banned such “tip pooling” in a rule that flagrantly ignored the underlying statute.

I generally supported the new rule on both legal and policy grounds, but I drew attention to the fact that it would allow restaurants to outright keep their employees’ tips, not just pool them among workers. I urged Congress to step in and fix it, considering this was actually a faithful interpretation of the law on the books. And it turns out they did, in a little-noticed provision of the spending bill.

The Washington Post reported late last week:

Tucked into Congress’s 2,200-plus-page omnibus spending bill are a few paragraphs that will prohibit restaurant owners from sharing server tips with supervisors, managers and themselves. But the provision will also allow employers, in some circumstances, to share tips with dishwashers, cooks and other back-of-the-house employees who have traditionally been underpaid compared with their counterparts in the dining room.

Both sides in the tipping wars are claiming victory: worker advocates, who see the provision as a bipartisan rebuke to a proposed Labor Department rule last year that could have legalized a practice now considered wage theft under the law, and the National Restaurant Association, which had been pushing to rescind a 2011 regulation that prohibited tip pooling for back-of-the-house employees in all circumstances.

Good on Congress.

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