House Passes Funding Bill Seeking Riders on Tip Pooling, Other Labor Issues (1)

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By Tyrone Richardson

The House March 22 passed a massive government appropriations bill that would increase funds for the Labor Department and include provisions preventing employers from pocketing workers’ tips as part of a controversial DOL rule.

The $1.3 trillion omnibus package, a combination of appropriations measures for funding through September, passed the House in a 256-167 vote. That tees up the legislation for Senate floor consideration before it would land on President Donald Trump’s desk for signature. It wasn’t immediately known on the afternoon of March 22 if the Senate would vote on the legislation during the day.

The legislation provides $12.2 billion in discretionary funding for the DOL, an increase of $192 million from fiscal year 2017. That includes increased agency funding for services such as veteran job placement and job training and apprenticeship programs.

The bill keeps the National Labor Relations Board funding flat, at $274 million. The Equal Employment Opportunity Commission would get $379.5 million, an increase from $364.5 million in fiscal 2017.

The bill also includes a series of policy riders such as a federal wage law exemption for minor league baseball players and an effort to thwart controversy stemming from a DOL rule on tip pooling. It excludes a provision that would block the NLRB’s 2015 ruling on joint-employer liability.

Negotiators were cautious about any controversial policy riders because the bill has to draw some bipartisan support to pass both chambers of Congress.

Lawmakers in the House and Senate must pass the omnibus by March 23 to avoid another government shutdown. Congress last month reached a deal to raise spending caps by almost $300 billion for two years. That left it to appropriators to decide how to use the increased allocations in an omnibus bill.

Tip Pooling Gets Served

The omnibus legislation includes a provision that would allow employers to impose tip-pooling arrangements at restaurants and other workplaces but ban management from participating in the pools. The legislation stems from Democratic and employee advocate criticism of the DOL proposed tip-pooling rule.

The criticism of the rule picked up steam since Bloomberg Law reported that the department scrapped an economic analysis showing that a proposed tip-sharing regulation could allow employers to skim billions of dollars in tips.

Senate Health, Education, Labor and Pensions ranking member Sen. Patty Murray (D-Wash.) has said a policy rider in the spending bill “prohibits employers from pocketing workers’ tips, including taking tips to pay managers and supervisors. It gives workers the right to sue to recover any stolen tips with added damages—regardless of how much they are paid.”

Some Democrats have raised issue with the rider. That includes Education and the Workforce Committee ranking member Rep. Bobby Scott (Va.), who told Bloomberg Law that he opposes the language in the provision.

“Reading the language, I don’t see how it’s not a bad thing,” he said. “It’s almost as bad as the original Department of Labor proposal that allowed the employer to take and keep the tips. This allows him to take the tips and redistribute them somehow without any requirement that it be done equitably.”

That could allow businesses to drop pay for back-of-house workers who don’t normally receive gratuities and force front-of-the-house employees to make up the difference by sharing their tips, he added.

Scott said he opposes the rider but applauded additional funding for education and military, a major economic driver for his district in Virginia’s Hampton Roads region.

“There are some good and bad” in the omnibus, Scott said. “Waiters are going to find out what’s in the bill the hard way.”

Scott was among a total of 111 Democrats who voted in favor of the omnibus bill March 22.

He is also among several Democrats who are asking for DOL Secretary Alexander Acosta to rescind the proposed tip-sharing rule.

Pitch Minor League Baseball Exemption

The omnibus also includes a provision that would exempt minor league baseball players from minimum wage and overtime pay requirements under the Fair Labor Standards Act. The language is plucked from Save America’s Pastime Act (H.R. 5580).

This is a result of Major League Baseball teams facing litigation from players who claim they weren’t paid for all hours worked during the season. The players allege they regularly worked as many as 70 hours per week and were required to participate in off-season training and instructional sessions without compensation.

The exemption would exclude the federal rule requiring workers must be paid at least $7.25 an hour and time-and-a-half wages for all hours beyond 40 each week.

Joint Employer Rider Excluded From Bill

The bill doesn’t include a measure to overturn the 2015 NLRB decision in Browning-Ferris Industries of California Inc. The controversial ruling has prompted efforts by the Trump labor board, courts, and Congress to reverse the decision that multiple organizations can be considered joint employers if they exercise indirect control over workers.

Republicans and business advocates have argued that the NLRB overreached with its 2015 decision. But some Democrats have said the NLRB decision better reflects workplace realities, including often complex contractual relationships between workers and businesses.

Groups are urging the Senate to vote on the House-passed Save Local Business Act (H.R. 3441), which would limit the extent to which affiliated businesses are considered joint employers for wage-and-hour and collective bargaining purposes.

The legislation passed the House Nov. 7 in a 242-181 vote, which included eight Democrats crossing the aisle to vote in favor of the bill.

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