VERIFY: Can Restaurant Owners Soon Steal Servers' Tips?

Verify: No More Restaurant Tipping? Pt.2

VERIFY QUESTION

You ask - we VERIFY. Monday, we took on a Good Morning Show viewer question about tips -- you know, the kind you give to your restaurant server if he or she does a good job.

Good Morning Show viewer Brock Lee reached out asking us to VERIFY this video. It's a PSA in which actress Jane Fonda alleges the Department of Labor has proposed a new rule that would "let restaurant owners legally steal their workers' tips." The video has received nearly half a million shares, but is it accurate?

VERIFY SOURCES

To VERIFY, we looked at the real proposal named 82-FR-5956-2, the tip regulations under the Fair Labor Standards Act. 

We also consulted the North Carolina Restaurant and Lodging Association.

VERIFY PROCESS

The Department of Labor filed a proposal in December aiming to reverse an Obama-era rule that prohibited employers from setting up tip-pooling arrangements.

The Trump administration proposal would allow so-called tip pooling, meaning the server would have to share the tip with other staff like waiters and dish washers.

Sounds fair, right? The problem Jane Fonda alleges in the video is that the law allows restaurant owners to control what is done with the tip and can either pool it out to staff or keep it for themselves.

That part is partially true, the way the law is currently written, but there is more to the story. We consulted the NC Restaurant and Lodging Association. The marketing director explained the rule applies only to servers already making at least the $7.25 minimum wage in addition to their tips. Employees who make the lower minimum wage of $2.13 plus tips would still get to keep their tips.

So, the NC Restaurant and Lodging Association indicated it supports the proposal. Marketing director Mindy Wharton issued WFMY News 2 a statement:

"Success in the restaurant industry is keeping the customer happy. Confining tips to just servers creates a disparity between the servers and those in the back of the house washing dishes and preparing the meal. They're all working toward the same goal of providing a great guest experience."

VERIFY CONCLUSION

In conclusion, we verified what the video alleges is partially true, but 'stealing' might not be the most accurate word choice. Under the proposal, restaurant owners who pay their employees the $7.25-an-hour wage would control tips and decide what they do with them. Employees who get the lower $2.13 wage with tips would be allowed to keep them.

Help VERIFY

Help our journalists VERIFY the news. Do you know someone else we should interview for this story? Did we miss anything in our reporting? Is there another story you'd like us to VERIFY? Click here.

Copyright 2017 WFMY


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