You are here:Home-Industry News-Foodservice-Trump Administration Ruling Would Let Restaurants Pool Tips

Trump Administration Ruling Would Let Restaurants Pool Tips

The Department of Labor may soon eliminate an Obama-era restriction on mandatory tip pooling among restaurant staff, opening the door for employers to redistribute tips from service staff to their colleagues behind the scenes.

In 2011, the U.S. Department of Labor added language to the Fair Labor Standards Act, or FSLA — which establishes minimum wage, overtime pay, recordkeeping, and youth employment standards in both government and the private sector — to ban restaurant and bar tip pooling between front-of-house workers (servers, bartenders, etc.) and non-tipped back-of-house employees (such as chefs and dishwashers).

Depending on the state, tipped employees may be paid as little as $2.13 an hour, the idea being that the balance of the applicable minimum wage is made up with tips. Untipped back-of-house staff, on the other hand, must be paid at least the regular minimum wage.

The Department of Labor instituted the 2011 rule out of concern that tip pooling would be used as an argument by employers to pay the lower minimum to all employees.

Read more