Nina Martinez, co-authored article for presentation: Practice before the New York City Human Rights Commission, NELA/NY Spring 2018 Conference, New York, NY, May 2018
Sally J. Abrahamson, O&G Employment Law Blog, May 7, 2018
In late March, the Trump administration backed off from a proposal that would have effectively given restaurants and other employers the legal right to pocket workers' tips. The U.S. Department of Labor (DOL) announced the proposed rule change last December, saying it would give employers the "freedom to share tips between traditionally tipped and non-tipped workers." It would have rolled back regulations introduced in 2011 by the Obama administration that barred employers from redistributing tips to anyone other than the employees who would normally receive them.
Too often, however, tip-pooling with non-tipped workers becomes wage theft when employers use it as a way to redirect tips to themselves. In the case of the DOL proposal, managers, supervisors and even business owners would have been legally entitled to receive a portion of workers' tips.
Thankfully, the backlash that erupted in response to the proposed change forced the DOL to reconsider the proposal and, ultimately, put forward amendments to the Fair Labor Standards Act (FLSA) that better protect tipped workers.