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 MurrayTrump health officials grilled over reports of politics in COVID-19 response CDC director pushes back on Caputo claim of 'resistance unit' at agency The Hill's Morning Report - Sponsored by The Air Line Pilots Association - Pence lauds Harris as 'experienced debater'; Trump, Biden diverge over debate prep MORE (D-Wash.) reached the deal with Labor Secretary Alexander AcostaAlex Alexander AcostaFederal litigator files complaint alleging Labor secretary abused his authority Appeals court to review legality of Epstein plea deal Appeals court finds prosecutors' secret plea agreement with Epstein didn't break law 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 TrumpObama calls on Senate not to fill Ginsburg's vacancy until after election Planned Parenthood: 'The fate of our rights' depends on Ginsburg replacement Progressive group to spend M in ad campaign on Supreme Court vacancy 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 MulvaneyMick MulvaneyMick Mulvaney to start hedge fund Fauci says positive White House task force reports don't always match what he hears on the ground Bottom line 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 ScottHouse passes bill to allow private lawsuits against public schools for discriminatory practices Pelosi: House will stay in session until agreement is reached on coronavirus relief This week: House returns for pre-election sprint MORE (D-Va.) and Reps. Keith EllisonKeith Maurice EllisonOfficers in George Floyd's death appear in court, motion for separate trials Ex-Minneapolis officer involved in Floyd death asks judge to dismiss murder charge Over 50 current, former law enforcement professionals sign letter urging Congress to decriminalize marijuana MORE (D-Minn.), Mark TakanoMark Allan TakanoCongress missed the point when it came to helping veterans During Suicide Prevention Month, Trump needs to do more for troops' mental health The Hill's Coronavirus Report: Fauci says focus should be on pausing reopenings rather than reverting to shutdowns; WHO director pleads for international unity in pandemic response MORE (D-Calif.) and Suzanne BonamiciSuzanne Marie BonamiciPelosi, Blumenaur condemn 'egregious abuses of power' by Trump against Oregon protestors Federal agents deployed to Portland did not have training in riot control: NYT US attorney calls for investigation into unmarked federal agents arresting protesters in Oregon MORE (D-Ore.) said in a joint statement.