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Labor Dept. proposal triggers a battle over employee gratuities

Joe Mont | February 7, 2018

There are two things we have learned during the first year of the Department of Labor under the Trump Administration: it isn’t afraid to court controversy; and anything promulgated under the Obama administration has a big bull’s-eye on it.

A recent effort that could force waiters and waitresses to share gratuities with non-server co-workers falls under both categories.

In December, the Department of Labor announced a Notice of Proposed Rulemaking regarding the tip regulations under the Fair Labor Standards Act . Under the proposed rule, workplaces “would have the freedom to allow sharing of tips among more employees” and “help decrease wage disparities between tipped and non-tipped workers,” an option that is currently restricted by a rule promulgated in 2011 and subsequently challenged in a number of courts.

The Department’s proposal only applies where employers pay a full minimum wage and do not take a tip credit and “allows sharing tips through a tip pool...

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