A new regulation proposed by the Trump administration would enable employers to commandeer the tips that their wait staff receives from their customers in appreciation of good service.
The new rule being put forth by the Department of Labor would roll back current regulations restricting “tip pooling”, a system where rather than each server retaining all of the money offered as a gratuity, every server’s tips are put into a pool and divided evenly amongst all the wait staff, with cuts often being shared with the bussers and dishwashers as well.
For a Republican administration to eliminate restrictions on tip pooling would be highly unusual given the system’s strong resemblance to a socialist redistribution of wealth. However, the language in the proposed ruling explains why Trump’s Labor Department is solidly behind the regulatory change.
The new rule does not actually require business owners to turn the tips over to their workers. In fact, it would make it perfectly legal for the owners to pocket all of the tips for their own benefit, as long as they are paying their staff at least minimum wage. Less like socialism, more like organized crime.
According to a report released by the Economic Policy Institute (EPI), workers can expect their employers to take advantage of them under the new rule:
“Recent research suggests that the total wages stolen from workers due to minimum wage violations exceeds $15 billion each year, and workers in restaurants and bars are much more likely to suffer minimum wage violations than workers in other industries. With that much illegal wage theft currently taking place, it seems obvious that when employers can legally pocket the tips earned by their employees, many will do so.”
The EPI reports that, although the federal rulemaking policies are explicit in requiring that all quantifiable costs and benefits “to the fullest extent that these can be usefully estimated must be assessed in proposing new regulations, no estimate was included in the proposal of the amount of money that would be shifted from workers to employers as a result of the rule, despite the fact that data is available to produce such an estimate.
“When there is uncertainty about a quantifiable cost or benefit, agencies typically do something like provide a range—they don’t forgo providing an estimate altogether. It is obvious why the department left out the required estimate: this rule is bad for workers, and any estimate would have made that crystal clear,” the EPI report continues.
“Make no mistake: as a result of this rule, workers will take home less, and their loss will be employers’ gain. And Trump’s DOL is willing to break the requirements of the rulemaking process to attempt to hide that fact.”
Trump is draining the swamp alright, right onto the floors of your local bistro. He deserves a tip for that. Here’s a good tip for him — hire a food tester next time you visit a restaurant.