Spending bill prevents employers from pocketing tips under tip-pooling rule

Spending bill prevents employers from pocketing tips under tip-pooling rule
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The $1.3 trillion spending deal released late Wednesday night includes language to prevent employers from being able to steal workers’ tips under the Labor Department’s controversial tip-pooling rule.

Sen. Patty MurrayPatricia (Patty) Lynn MurrayGOP leader criticizes Republican senators for not showing up to work Senate Dems press Sessions for records on racial discrimination complaints Dem senators introduce resolution calling on Trump to stop attacking the press MORE (D-Wash.) reached the deal with Labor Secretary Alexander AcostaRene (Alex) Alexander AcostaTrump Jr. falsely claims that GDP growth never passed 2 percent under Obama Small businesses just scored a win on health-care costs RNC chairwoman, Labor secretary pull out of annual Latino conference MORE to add a rider in the bill that amends the Fair Labor Standards Act to prevent employers, managers or supervisors from pocketing workers’ tips regardless of whether they earn gratuities on top of a full minimum wage.

The language gives workers the right to sue to recover any stolen tips with added damages and gives the secretary of Labor the ability to impose civil penalties on employers who violate the law.

“When President TrumpDonald John TrumpBrennan fires new shot at Trump: ‘He’s drunk on power’ Trump aides discussed using security clearance revocations to distract from negative stories: report Trump tried to dissuade Melania from 'Be Best' anti-bullying campaign: report MORE proposed a rule that would have allowed corporations to pocket workers’ tips for themselves, workers across the country organized and made their voices heard,” Murray said in a statement.

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“Those workers sent the Trump Administration a message — and I’m pleased that Secretary Acosta listened, reversed course, and worked with me on legislation to make sure that big businesses can’t steal their workers’ tips. For the millions of workers who rely on their tips to pay their bills and support their families, most of whom are women, this change comes as a sigh of relief,” she said.

Acosta has been under fire since the rule was first proposed in December to allow employers to pool the tips of workers who make the full minimum wage and split them with nontipped workers.

The rule does not apply to workers who make less than a full minimum wage and use tips to supplement their pay, but labor groups said there was nothing in the regulation to stop employers from pocketing a portion of employees’ tips.

A Bloomberg Law report later revealed agency officials had withheld an unfavorable report that showed workers stand to lose billions in gratuities if the rule is finalized.

Democrats, labor groups and 17 state attorneys general have since demanded Acosta withdraw the rule.

And in a second report Wednesday morning, Bloomberg Law reported that Acosta convinced Office of Management and Budget (OMB) Director Mick MulvaneyJohn (Mick) Michael MulvaneyPentagon, GOP breathe sign of relief after Trump cancels parade Middle-class Americans can't afford another trillion financial crash Treasury retweets Trump, possibly violating campaign law MORE to overrule the nation’s regulatory czar to release the rule.

OMB fired back against that report Wednesday afternoon.

In a statement to The Hill, office spokesman Coalter Baker said OMB historically does not comment on the deliberative process, but is making an exception in this case.

"We will make an exception now, as the premise of this reporting is false: there is zero daylight between Director Mulvaney and [Office of Information and Regulatory Affairs] Administrator [Neomi] Rao on regulatory policy," he said. 

Top Democrats on the House Education and the Workforce Committee said Wednesday they will be requesting a hearing to examine the department's conduct and Acosta’s role in this controversy.

“This latest report from Bloomberg Law that Labor Secretary Acosta urged OMB Director Mick Mulvaney to exclude a legally required analysis only intensifies existing concerns about the integrity of the rulemaking process for its proposed rule to allow employers to keep and control how to redistribute workers' tips,” Committee ranking member Rep. Bobby ScottRobert (Bobby) Cortez ScottOvernight Health Care: Senate takes up massive HHS spending bill next week | Companies see no sign of drugmakers cutting prices, despite Trump claims | Manchin hits opponent on ObamaCare lawsuit The Hill's Morning Report: Dems have a majority in the Senate (this week) Overnight Health Care: Supreme Court nomination reignites abortion fight in states | Trump urges Sessions to sue opioid makers | FDA approves first generic version of EpiPen MORE (D-Va.) and Reps. Keith EllisonKeith Maurice Ellison#BelieveAllWomen, in the Ellison era, looks more like #BelieveTheConvenientWomen Ellison ex-girlfriend details abuse allegations Dem requests DOJ probe on law enforcement use of facial recognition technology MORE (D-Minn.), Mark TakanoMark Allan TakanoHouse panel advances major VA reform bill Spending bill prevents employers from pocketing tips under tip-pooling rule Veterans Health Administration needs stronger recruitment methods MORE (D-Calif.) and Suzanne BonamiciSuzanne Marie BonamiciLawmakers, media serve up laughs at annual 'Will on the Hill' Congress — when considering women’s health, don’t forget about lung cancer Overnight Energy: Two top Pruitt aides resign at EPA | 17 states sue EPA over car emissions rules | Volkswagen to pay West Virginia .5M over emissions cheating MORE (D-Ore.) said in a joint statement.