Tip Pooling: Why Is the Newport Restaurant Industry So Afraid of Freedom?


Sometimes the morning papers arrive and a practical reader can’t help but wonder what perspective makes something newsworthy.  That was my reaction to a big front-page article in a February Newport Daily News by Sean Flynn.  The story is that the Trump administration is undoing an Obama-era power grab whereby the federal government dictated rules for tipping in every restaurant across the country.

After an opening paragraph stating the most extreme interpretation of the legislation, Flynn spends nine paragraphs quoting local waitstaff who strongly oppose the change.  (“The proposal is kind of disgusting,” says Schae Williams of Blue Plate Diner.)  If a reader is interested enough to wade through all that and turn to page A10, he or she will find this:

The proposed rule just reverses an Obama-era rule that prohibited employers from setting up tip-pooling arrangements that include employees who are not customarily tipped, such as dishwashers and cooks, Amador argued.

Critics say nothing in the rule change would require the employers to actually redistribute all the tips.

Amador countered that some states have laws similar to New York, where gratuities left by guests and customers can only be shared with non-managerial employees, not employers or managers.

But that would leave the matter up to the 50 individual states whether or not to enforce such a law, the critics say.

Then we get more paragraphs of the opposition’s arguments and lamentations.  At no point, by the way, does the article mention that Rhode Island would be primed to take the position that these servers want.  In 2012, the Rhode Island House passed legislation that would ban employer tip collection and tip pooling.  It didn’t get through the Senate, but the Obama administration had already acted, so it couldn’t have been a priority at the state level.

Without getting into the merits of that argument, though, why do these people feel so threatened by others’ freedom?  Nothing in the rule change would require any change to the way restaurants handle tips.  As the article illustrates by quoting restaurant managers who support servers’ keeping their tips, the status quo — which was the status quo even before Obama’s power grab — would remain in place.  Regulations could be imposed at the state level, if that’s what Rhode Island wants, and individual businesses could figure out what works for them.

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If skimming or pooling tips really bites into the income of servers, then restaurants that do it won’t keep their servers, unless they’ve got some good reason that employees find helps them, too.  Americans (Rhode Islanders, especially) tend too much to the mentality that everybody should be forced to do things in a way that works for any particular individual or group.