Restaurant Owners and Managers Cannot Keep Servers’ Tips, Per New Budget Bill

The Department of Labor’s proposed tip-pooling regulations have been overruled

by Andrea Strong Updated Mar 23, 2018, 2:02pm EDT

• The government has passed its new budget proposal, which includes protections for tipped workers. President Trump signed it into law hours after threatening to veto it.

• The bill expressly prohibits employers, managers, or supervisors from collecting or retaining tips made by employees — one of the biggest concerns opponents had against the Department of Labor’s most recent, and widely hated, proposal. The bill nullifies that previous proposal.

• The new law allows tip sharing between tipped and non-tipped employees — for example, between servers and cooks — if a restaurant pays the full minimum wage to all employees. The is a departure from Obama-era rules, which did not allow such sharing of tips.


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