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 MurrayOvernight Health Care: Trump officials defend changes to family planning program | Senators unveil bipartisan package on health costs | Democrats pass T spending bill with HHS funds Overnight Health Care: Trump officials defend changes to family planning program | Senators unveil bipartisan package on health costs | Democrats pass T spending bill with HHS funds Chris Murphy may oppose bipartisan health bill unless it addresses ObamaCare 'sabotage' MORE (D-Wash.) reached the deal with Labor Secretary Alexander AcostaRene (Alex) Alexander AcostaTop aide to Labor secretary to leave amid friction with White House George Conway slams Trump for calling Biden 'creepy': You 'palled around with Jeffrey Epstein' Melania Trump expands mission of 'Be Best' on its one-year anniversary 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 TrumpBooker hits Biden's defense of remarks about segregationist senators: 'He's better than this' Booker hits Biden's defense of remarks about segregationist senators: 'He's better than this' Trump says Democrats are handing out subpoenas 'like they're cookies' 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 MulvaneyCongressional leaders, White House officials fail to reach budget deal Congressional leaders, White House officials fail to reach budget deal Congressional leaders, White House officials to meet Wednesday on spending 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 ScottTop Trump health official warned against controversial ObamaCare changes in private memo Top Trump health official warned against controversial ObamaCare changes in private memo Centrist Democrats raise concerns over minimum wage push MORE (D-Va.) and Reps. Keith EllisonKeith Maurice EllisonHillicon Valley: Facebook unveils new cryptocurrency | Waters wants company to halt plans | Democrats look to force votes on election security | Advertisers partner with tech giants on 'digital safety' | House GOP unveils cyber agenda Hillicon Valley: Facebook unveils new cryptocurrency | Waters wants company to halt plans | Democrats look to force votes on election security | Advertisers partner with tech giants on 'digital safety' | House GOP unveils cyber agenda State attorneys general demand that Congress take action on election security MORE (D-Minn.), Mark TakanoMark Allan TakanoSteyer group targeting 12 congressional Democrats over impeachment Steyer group targeting 12 congressional Democrats over impeachment ICE does not know how many veterans it has deported, watchdog says MORE (D-Calif.) and Suzanne BonamiciSuzanne Marie BonamiciWHIP LIST: Number of Democrats backing Trump impeachment inquiry rises WHIP LIST: Number of Democrats backing Trump impeachment inquiry rises DeVos defends controversial guidance on transgender students MORE (D-Ore.) said in a joint statement.