Dem Lawmakers Call on Labor Department to Rescind Tip-Pooling Rule

House Democrats are calling on the Department of Labor to withdraw it’s proposed tip-pooling rule following a report that agency officials hid an unfavorable economic analysis.

Bobby Scott (Va.), the top Democrat on the House Education and the Workforce Committee, and Rep. Mark Takano (Calif.), the ranking Democrat on the Workforce Protections Subcommittee, said the public cannot fully comment on the rule without access to all the information.

Bloomberg Law reported Thursday that senior department officials withheld a report showing that employees could lose billions of dollars in tips if the agency changes the Fair Labor Standards Act and allows employers to pool the tips of workers who make at least the federal minimum wage, which is $7.25 an hour.

The proposal did not include employees who make less than the federal minimum wage and earn tips to supplement their pay.

In a statement, Scott said he’s deeply troubled by the report and plans to send an oversight letter to the department, requesting they share any and all economic analyses they have on the effects of the tip rule.

“When an agency puts out a rule, it must demonstrate that the rule's benefits justify its costs,” he said.

Takano said the Bloomberg Law report raises serious concerns about the integrity of the rulemaking process.

“In light of this information, the only appropriate course of action is to withdraw the proposed rule,” he said.

“The Department of Labor, as well as the Office of Management and Budget, have serious questions to answer about the transparency of their rulemaking process. I look forward to getting answers to those questions in the coming days.”

Comments on the proposed rule are due Feb. 5. 

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