February 1, 2018 / 9:40 PM / in 3 months

Some Democrats urge Trump administration to drop tip-pooling plan

Feb 1 (Reuters) - Three Democrats in the U.S. Congress on Thursday called on the Trump administration to withdraw a proposal that would allow restaurants and other employers to pool workers’ tips, a measure that has drawn fire from restaurant workers and labor advocates.

U.S. Senator Patty Murray of Washington and Representatives Robert Scott of Virginia and Mark Takano of California cited a news report that accused the U.S. Department of Labor of failing to disclose the results of an analysis that determined pooling tips could cost workers billions of dollars.

The lawmakers said the Labor Department may have violated federal law by withholding information, after Bloomberg Law reported that the department had shelved the analysis.

All three lawmakers are the senior Democrats on committees that make labor policy: Murray on the Senate Health, Education, Labor and Pensions Committee; Scott on the House Committee on Education and the Workforce; and Takano on the House Subcommittee on Workforce Protections.

The Labor Department stuck by its proposal and said in a statement it intends to publish “an informed cost benefit analysis” after a public comment period on the proposal closes on Monday.

“As part of every rulemaking process, the department works to provide the public accurate analysis based on informed assumptions to productively engage in the notice and comment period,” the department said.

The proposal would allow businesses to collect workers’ tips and redistribute them to non-tipped employees. Currently, companies that pay workers the tipped minimum wage, which is lower than the standard minimum wage of $7.25 per hour, cannot pool tips in this way.

The proposal on tips is one of several attempts to undo Obama administration labor rules. Federal agencies have taken steps toward repealing rules to extend mandatory overtime pay to 4 million workers and to require companies to report wage data broken down by sex and race.

The Trump administration and business groups that support the proposed tipping rule say it will allow employers to redistribute tips to cooks and dishwashers, raising their pay.

But critics say that under the proposal, once businesses meet their obligation to pay workers the minimum wage, they could pocket any tips that remain.

If the department publishes a final rule that does not include an analysis of how workers would be affected, it could form the basis of a legal challenge, said Christine Owens, the executive director of the union-backed National Employment Law Project. (Reporting by Daniel Wiessner in New York, Editing by Alexia Garamfalvi and David Gregorio)

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