Concerns over Trump administration restaurant 'tipping' proposal

Published: Dec. 6, 2017 at 6:09 PM EST
Email this link
Share on Pinterest
Share on LinkedIn

(12/6/17) - For people working in the restaurant industry, tips are a big part of their take home pay.

But changes could soon be coming to the way they're distributed under a proposal from the Trump administration.

Right now, restaurant owners are required to distribute tips to their tipped employees.

Under this new rule, published in the Federal Register, restaurants would be able to pool tips from servers and share them with untipped employees, like busers and dish washers.

"Most independent restaurants in this area are probably working on a sub 5 percent margin, so when there's the ability to compensate the people in the back of the house that don't quite make as much money and folks in the front of the house that make a little bit more money, it does make sense," said Starlite Diner owner Jason Hester.

And while Hester agrees it makes sense for smaller mom and pop type places, there are concerns with bigger corporate run restaurants where he says transparency would need to be key.

Another topic of concern, he says is accountability that those higher up on the chain will not dip in for themselves.

"We're at like an all time high for food inflation, wage inflation across the board; there's a lot of constraints that hit the restaurant business and so to find good people, we have to continually pay more, but for a business like ours, we rarely raise our prices," he said.

The Department of Labor argues that tip pooling will help reward those who don't normally get tips.

Right now it's just a proposal.

If approved the new rules could take effect as soon as early next year.

Latest News

Latest News