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Trump’s DOL Concealed Data to Hide Numbers Showing Its Tip Rule Will Likely Cost Workers Billions

Feb. 7, 2018

Trump’s DOL Concealed Data to Hide Numbers Showing Its Tip Rule Will Likely Cost Workers Billions

More Than 50 Groups Call on Labor Department to Release Hidden Analysis Questioning Controversial Tip Rule

WASHINGTON, D.C. – Officials at President Donald Trump’s U.S. Department of Labor (DOL) are deliberately hiding a report that shows its new “tip pooling” rule quite literally will allow restaurant owners to take money out of the pockets of their employees, Public Citizen and more than 50 other groups said in a letter to the department today.

Following revelations that the DOL covered up an internal analysis of its controversial tip proposal, Public Citizen and 55 groups today urged U.S. Labor Secretary Alexander Acosta to immediately release the economic analysis and underlying data and to withdraw the proposed rule.

In the letter, the groups – in support of government accountability, workers, women and families and civil justice – said they are deeply disturbed by the Bloomberg report that senior DOL officials sought and received authorization from the White House to exclude the economic transfer data in order to conceal the expected impact of the rule.

“If accurately reported, such actions are profoundly troubling,” the letter says. “The report indicates that a predetermined outcome was sought, rather than an evidence-based analysis – and when the data got in the way, it was suppressed.”

Tip pooling hurts workers by allowing restaurant owners to garnish servers’ gratuities and distribute them to cooks and dishwashers (in states where servers make at least the minimum wage). But the proposal also allows restaurant owners to transfer those tips to their own pockets. In the wake of the reported DOL cover-up, the department’s Office of Inspector General (OIG) has initiated an audit of the related rulemaking process. The proposed rule, conducted by the department’s Wage and Hour Division, has come under widespread attack by worker advocates for allowing management to take employee gratuities to use at the employers’ own discretion.

“If news reports are accurate, it’s shameful that Secretary Acosta would hide the DOL’s own estimates that employers could cheat employees out of billions of dollars in hard-earned tips – in an effort to conceal the very real negative impacts its tip pooling proposal will have on U.S. workers in the service sector,” said Robert Weissman, president of Public Citizen. “The department must immediately withdraw this industry-driven proposal and fully comply with the OIG audit into the cover-up.”

The full letter can be found here.