12.15.20

Chairman Scott: Government Watchdog Confirms DOL Broke the Law

The Department of Labor Intentionally Hid Data that Showed its Proposed Rule Would Cost Workers Billions and is Set to Strip Struggling Tipped Workers of Protections Again

WASHINGTON – Chairman Robert C. “Bobby” Scott (VA-03) issued the following statement after the Department of Labor Office of Inspector General (OIG) released the findings of its investigation into the Department’s rulemaking process for its 2017 proposed tip rule.  The report found that, among other errors, the Department improperly withheld information regarding the expected impact of the rule on tipped workers. The 2019 proposed tip rule places no limitation on the amount of time a tipped employee can perform related, non-tipped activities and still be paid the subminimum wage. 

“The Department of Labor (DOL) Inspector General confirmed what we have known for years: DOL purposefully withheld data that showed that the 2017 tip rule would have let employers pocket billions in workers’ tips.  

“Now, the Department is on the verge of finalizing another rule that would cost tipped workers. The Department’s 2019 proposal to codify the repeal of the 80/20 rule would allow employers to pay workers a subminimum wage while assigning them work that does not provide them with ample opportunity to earn tips.  The Economic Policy Institute estimates that, if finalized, this rule would cost workers more than $700 million each year.  The Department is also relying on the same excuses it used in the 2017 rule to withhold the potential economic impacts of the 2019 rule for workers, even while conceding that the rule could reduce the employment of workers, such as dishwashers or busboys, who currently perform non-tipped duties.

“Well before the COVID-19 pandemic, America’s tipped workers earned lower wages and experienced poverty at higher rates than non-tipped workers.  Now, tipped workers need protections against wage theft more than ever.  The Department must uphold its mission to serve our nation’s workers by rescinding the Department’s 2019 proposed tip rule and supporting legislation to phase out the subminimum wage for tipped workers.”

 

###

Press Contact

Democratic Press Office, 202-226-0853