Speed Reads

pay your workers

The Trump administration is pushing a socialist tip-pooling scheme for restaurants

The Department of Labor unveiled a proposal Monday that would force workers who receive tips to share that money with untipped workers, The Wall Street Journal reports. The department says the plan would "decrease wage disparities between tipped and non-tipped workers."

Restaurant owners and industry associations frequently argue in favor of tip-pooling, claiming it eases the difficulty of finding people to fill the less lucrative untipped positions. Labor advocates say that in reality, the practice is often exploited by restaurant owners to pay their workers less.

Under the Trump administration's proposal, workers paid the minimum wage by their employer would have to pool their tips with "back of house" employees like cooks and dishwashers. Workers who receive tip credits and are paid the federal minimum tipped wage of $2.13 would not be subject to the tip-pooling. Many restaurants voluntarily pool tips for "front of house" employees like barbacks, waiters, service staff, and bartenders, but federal law prohibits untipped employees from participating in those pools.

Critics say the Labor Department's idea is a gift to restaurant owners. "All this proposal will do is make it harder for tipped workers to get by — yet another example of the Trump administration's elevation of corporate interests over those of working people," the National Employment Law Project, a nonprofit that advocates for workers, said in a statement Monday.

The Trump administration will formally submit the proposal Tuesday, after which it will be open for public comment for 30 days.