AFL-CIO groups demand DOL withdraw rule to allow employers to keep workers’ tips

Trump DOL omitted key data showing workers would lose $5.8 billion in tips – $4.6 billion from women

Washington – The Labor Coalition for Community Action, which consists of six AFL-CIO constituency groups, is demanding the Department of Labor (DOL) withdraw its proposed “tip theft” rule that would shift ownership of tips from workers to employers.

In a statement, the Labor Coalition said:

“This proposed rule to steal hard-earned tips from the pockets of restaurant workers is utterly despicable. Instead of affirming that tips are the property of workers, the Trump administration is championing corporate greed and acting as an extension for the National Restaurant Association.

“With tip theft already a common occurrence in the restaurant industry, the legalization to shift ownership of tips to employers is another example of working people being robbed of what they are due. Trickle down policies, such as this proposed rule, will maintain the status quo and wedge an even larger gap between the richest and the poorest.

“If enacted, workers will lose an estimated $5.8 billion in tips, with $4.6 billion of that coming from women workers,” information that the Trump administration’s Department of Labor has tried to hide from the public.

DOL OMITTED KEY DATA

Bloomberg Law reports that the DOL omitted key data from the tip pooling proposal, hiding from the public estimates of gratuities that employees could be cheated out of by employers, lending credence to concerns from Democrats and Labor organizers that the proposed rule will shortchange workers.

The intentional omission also raises questions about how much the DOL intends to take public feedback into account in shaping a final version of the rule.

“The Department of Labor under the Trump administration already has demonstrated that handouts to employers take precedence over workers’ health, safety and economic security,” Shanna Devine, worker health and safety advocate for the government watchdog group Public Citizen’s Congress Watch division said.

“At every turn, the department has made it harder, not easier, for hardworking Americans to earn a decent wage. Along with efforts to weaken the overtime and fiduciary rules, hiding economic data that proves the tipped wage rule rollback is a bad deal for restaurant workers is just another example that the department’s mission under President Donald Trump is to please corporate interests, not protect workers,” Devine said.

‘POLITICALLY INCONVENIENT’

“When its own data showed that its proposed rule on tips would enable employers to steal billions from employees,” the DOL “covered up the data,” Public Citizen’s regulatory policy advocate Amit Narang added.

“It is astonishing and deeply troubling that the department would intentionally hide economic data that shows just how much restaurant workers stand to lose to their employers if the Trump administration rescinds the tipped wage rule,” Narang said. “This administration has pledged that its regulatory rollbacks would be firmly grounded in economic analysis and has falsely criticized the Obama administration for not doing so. Yet this news makes clear that this administration is more than willing to throw economic analysis out the window when it is politically inconvenient.”

WOMEN, PEOPLE OF COLOR WOULD BE HURT WORST

With women and workers of color comprising the lowest paid segments of the restaurant industry, this proposed tip theft rule would disproportionately impact the most vulnerable workers and feed into a cycle of poverty and economic instability.

“We are committed to advocating for the rights of workers in all industries and to fighting against greedy policies that fuel into the systematic oppression of people of color, women, and LGBTQ workers,” the Labor Coalition said in its statement. “We demand that the Department of Labor withdraw this disgusting “tip theft” rule immediately and call on it to do its job: to fight for workers, not employers.”

The Labor Coalition for Community Action includes: the A. Philip Randolph Institute, Asian Pacific American Labor Alliance, Coalition of Black Trade Unionists, Coalition of Labor Union Women, Labor Council for Latin American Advancement and Pride at Work.