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Tip Credit Update

The State Department of Labor completed its final public hearing on eliminating the tip credit at the end of June. So what happens next? We wait…there is no timetable on the decision and no formal process to make a decision. Unlike an actual proposal to change a regulation which has a regimented process, this is an informal process under which the Labor Department is soliciting comments and seeking research to help them answer the question “should the tip credit be eliminated?” We’re expecting the outcome will be a report from the Department that makes a recommendation to the Governor, but even that is somewhat speculative. We could wake up one day and read a press release that announces the outcome, whatever that is, or we can never hear anything on the subject leaving the possibility of eliminating the tip credit hanging over our heads for the foreseeable future or even longer.

So what can we do in the meantime? Our priority has been to keep up the public activity demonstrating strong opposition to any change from those most effected – the serving staff. The “Supporters of the Tip Credit” Facebook page continues to bring servers into the discussion and the Restaurant Workers of America are regularly speaking out as opportunities present themselves.

Of course, even if the Governor and Department of Labor don’t pursue a change in the tip credit we still have a problem in the State Legislature. There are bills in both the Assembly and Senate to eliminate the tip credit and while they’re not going anywhere now, that could change in the future. Restaurant Opportunities Center (ROC) is not going to relent in their efforts to eliminate the tip credit. For that reason, as the Summer fades and Fall approaches we’re planning a legislative education effort to make sure legislators and candidates know how devastating eliminating the tip credit will be to our industry – especially tipped workers. Keep an eye out for future updates and our call to action!