Posted January 29, 2018
New polling released today shows that voters overwhelmingly disapprove of a U.S. Department of Labor proposal to allow employers to keep their workers’ tips, and that the rule change would negatively affect how much and how often patrons tip the workers who serve them.
On December 5th, the Labor Department proposed a rule that would allow employers to keep all the tips their workers receive, so long as the employer pays them at least the federal minimum wage of $7.25 per hour. While, in theory, employers could redistribute the tips to raise pay for workers who don’t normally receive tips, they also could also use these tips for their own purposes, such as making business improvements or just keeping the money for themselves—a possibility the Labor Department acknowledges.
The poll of more than 800 registered voters, conducted by Hart Research Associates and released by the National Employment Law Project, described the proposal to respondents, asked if they favored or opposed it, and inquired as to how it would impact their tipping practices. Fully 82% of respondents across party and geographic lines opposed the proposal (61% strongly opposed), and 57% said that if the proposal became law, they would likely tip workers less and tip less often.
More than 300,000 Americans have weighed in against the proposal so far.
“Voters understand that this is a blatant attempt to transfer billions of dollars from consumers and workers to restaurant chain owners,” said Christine Owens, executive director at the National Employment Law Project. “Worse yet, this poll provides further evidence that consumers will tip less and less often if they think their tips will go to the CEO instead of their server. The Labor Department should listen to voters, consumers, and restaurant workers and scrap this outrageous proposal.”
The Economic Policy Institute estimates that this proposal would result in employers pocketing $5.8 billion in tips that would ordinarily remain in the hands of service workers in industries ranging from restaurants, to hotels and hospitality, to parking attendants. A recent analysis by NELP shows that servers and bartenders depend on tips for more than half their earnings: for wait staff, $5.85 of every $10 earned comes from tips, while for bartenders, $5.40 of every $10 comes from tips.