Compromise and Uncertainty on Tipping in the Appropriations Act

The past few years have been tumultuous for tip pooling regulations, leaving restaurants with some confusion and unresolved questions.  Nearly 300,000 businesses across the United States employ tipped workers.

In 2011, the Department of Labor under the Obama Administration passed regulations on tip pooling.  These regulations specified that tips were considered the property of the service-facing employee (such as waiters, bartenders, and others who directly interact with customers in the chain of service), and employers could not require service-facing employees to share their tips with back of the house employees (i.e. kitchen staff who would not interact with customers directly in the chain of service) who would not traditionally receive tips. 

Additionally, the regulations required employers to notify tipped employees of any required tip pool contribution amount, limit their tip credit for the amount of tips each tipped employee ultimately receives, and prevented employers from…