Final Rule Expands DOL’s Power to Fine Businesses for Tip Theft (1)

The U.S. Labor Department revised a Trump-era regulation by expanding the circumstances in which businesses can be fined for pocketing workers’ tips.

In a final rule published Thursday, the department asserted authority to penalize restaurants and other employers up to $1,100 per violation, plus back wages owed, whenever it determines tipped workers have been cheated. The Trump measure, which never took effect, allowed fines to be levied only for “repeated and willful” violations.

The new penalty provisions only apply when employers, including supervisors and managers, keep tips intended for workers, such as servers and bartenders. Employers retaining tips became a ...