02.02.18

Top Democrats Demand DOL Share Estimates about Effects of Harmful Proposed Tip Rule

"[This] conduct raises serious questions about the integrity of the Department's rule making process."

WASHINGTON – Congressman Bobby Scott (VA-03),  ranking member of the Education and the Workforce Committee, Congressman Keith Ellison (MN-05), vice chair of the Congressional Progressive Caucus, Congressman Mark Takano (CA-41), ranking member of the Subcommittee on Workforce Protections, and Congresswoman Suzanne Bonamici (OR-01), vice ranking member of the Committee on Education and the Workforce, sent a letter to Department of Labor (DOL) Secretary R. Alexander Acosta requesting the Department share any and all economic analyses they have on the effects of the tip rule. This request is in response to a Bloomberg BNA report that DOL intentionally withheld estimates that its proposed tip rule would cost workers billions of dollars in lost income.  


“If the Department has withheld such analysis and then misrepresented this relevant fact in the NPRM, such conduct raises serious questions about the integrity of the Department’s rule making process,” the Members wrote. “Further, a Department spokesperson speaking to Politico stated, “after receiving public comment, the department intends to publish an informed cost-benefit analysis as part of any final rule.”  This deviates from the requirements of Executive Order 13563.”


The members have asked that the DOL respond to their questions and requests for internal communications relating to a decision to withhold estimates no later than Monday, February 5, 2018. The members previously raised concerns about this lack of analysis, urging the Department to extend the rule’s public comment period and hold public hearings on the rule. The public cannot fully weigh in if the process excludes analysis of how much workers will lose under this rule.


The text of the letter is enclosed below:

 
Dear Secretary Acosta:


On February 1, 2018, Bloomberg BNA reported that the Department of Labor (DOL) prepared and intentionally withheld an economic analysis quantifying the loss of tip income for tipped workers as part of its Notice of Proposed Rulemaking (RIN 1235-AA21), Tip Regulations under the Fair Labor Standards Act (FLSA) (hereinafter “NPRM”).  The article states that the DOL “scrubbed an unfavorable internal analysis from” the NPRM, and also states that “senior department political officials—faced with a government analysis showing that workers could lose billions of dollars as a result of the proposal—ordered staff to revise the data methodology to lessen the expected impact, several sources said.” 


This internal economic analysis reportedly includes estimates that workers would lose billions in income as a result of the rule.  If this is correct, such analysis would contradict the NPRM, which stated “[t]he potential benefits and transfers have not been quantified” for the proposed rule. 


If the Department has withheld such analysis and then misrepresented this relevant fact in the NPRM, such conduct raises serious questions about the integrity of the Department’s rule making process.   Further, a Department spokesperson speaking to Politico stated, “after receiving public comment, the department intends to publish an informed cost-benefit analysis as part of any final rule.”  This deviates from the requirements of Executive Order 13563.

Pursuant to our oversight responsibilities under the Rules of the House of Representatives, this letter requests the Department provide no later than February 5, 2018 the following information related to the economic analyses that are or have been in the possession of the DOL regarding the impacts of the proposed Tip Regulations:

  1. Has there been any draft, interim, proposed or completed quantitative or economic analysis, including any cost-benefit analysis, that was prepared, procured or otherwise commissioned by the Department of Labor in the connection with or related to the NPRM?
  2. A copy of each and every draft, interim, proposed or completed economic analysis covered in item #1.
  3. Were the findings of any of these analyses disclosed in the NPRM?
  4. A copy of the methodology used in each draft, interim, proposed or completed economic analysis covered in item #1.
  5. A copy of any documents and communications, as defined in Appendix A, involving DOL personnel regarding the preparation or review of such economic analysis covered in item #1, including any communications regarding proposals or directives to change the methodology used to estimate impacts in order to lessen the potential impact of the rule.
  6. A copy of all documents and communications that discussed the basis for including or excluding such economic analysis in the NPRM.
  7. A list of all meetings held to discuss whether to include or exclude such economic analysis in the NPRM. Please provide the date and the participants in such meetings, whether conducted in person or by teleconference.
  8. A list of the names of all DOL officials who were involved in reviewing or deciding whether to include or exclude the results of such economic analysis in the NPRM.  Please provide the title and email contact information for each individual.
  9. A copy of any documents and communications between the DOL and any private party outside the DOL regarding the economic analysis covered in item #1.
  10. A copy of any documents and communications between the Office of Management and Budget and the DOL pertaining to the preparation or inclusion of such quantitative or economic analysis in the NPRM.

Sincerely,

 

Bobby Scott (VA-03), Committee on Education and the Workforce, Ranking Member
Keith Ellison (MN-05), Congressional Progressive Caucus, Vice Chair
Mark Takano (CA-41), Subcommittee on Workforce Protections, Ranking Member
Suzanne Bonamici (OR-01), Committee on Education and the Workforce, Vice Ranking Member 

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