The next time you leave a tip at your favorite bar, restaurant or hotel, be warned that all the money you leave your server might not be headed in their pocket. Rep. Christopher R. Blazejewski, D-Providence, is intent on changing that.
Blazejewski has proposed a bill banning establishments from taking “tip credits” out of tips left for wait staff. “My district in Fox Point has a lot of college students and working-class people that have to work more than one job. They have frequently told me that they have had some, or all, of their tips taken from them,” he said. “This bill does two things: It prevents tips from being taken from waiters and waitresses that have earned them. It also prevents fraud on the patrons that pay those tips and have the reasonable expectation that the tips reward the wait staff for good service.”
The bill not only seeks to clarify Rhode Island law but is also stricter than what is currently allowed by the U.S. Department of Labor.
In Rhode Island, wait staff must be paid at least a minimum wage of $2.89 per hour. According to the law, employers are allowed to keep the difference between the minimum wage of $7.40 and the wage of $2.89, or $4.51 per hour from the employees’ tips.
Many restaurants and companies in the service industry simply allow their employees to keep their entire tips, however some follow this tip-credits practice. Taking more is not allowed by federal law, even if the worker is paid a full hourly minimum wage, $7.40 in the Ocean State.
The bill allows for individuals to keep their tips and service charges, or for members of a wait staff – waiters, waitresses, bus boys, bartenders and the like – to pool the money. It prohibits others, such as floor managers, to remove funds from tips, pooled or not. Also, in cases where a credit card is used, credit card usage fees cannot be taken from the tip and it is to be given to the wait staff on the same business day.
Estate and Corporate Income Taxes are changing next year, and business owners and executives should know the details. The PBN Summit on November 6th will provide those details and more - including how much Obamacare's Employer Mandate could cost.
PBN's annual Book of Lists has been an essential resource for the local business community for almost 30 years. The Book of Lists features a wealth of company rankings from a variety of fields and industries, including banking, health care, real estate, law, hospitality, education, not-for-profits, technology and many more.