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Women Would Be Most Affected By “Tip Stealing” Rule

Nearly 80 percent of the tips that would be stolen by employers would come from female tipped workers.

WASHINGTON - The Department of Labor (DOL) recently proposed a rule that would make it legal for employers to pocket the tips of their tipped workers, as long as they pay their workers the minimum wage. EPI previously estimated that if this “tip stealing” rule is finalized, workers will lose $5.8 billion every year, as tips are shifted from workers to employers. New research finds that of the $5.8 billion, nearly 80 percent—$4.6 billion—would be taken from female tipped workers. Because women are both more likely to be tipped workers and more likely to earn lower wages, these regulations would disproportionately harm them.

“Instead of giving workers a badly needed boost to their paycheck, the Trump administration is actively making it legal to steal tips from working people,” said EPI Director of Policy Heidi Shierholz. “Many women who work for tips already face harassment and discrimination at work, and this rule adds insult to injury.”

The analysis also includes a state-by-state breakdown of how much money tipped workers would lose, as well as a breakdown by race. All tipped workers regardless of race could be penalized from this rule. White non-Hispanic tipped workers would lose $3.5 billion, Hispanic workers would lose $1.4 billion, black non-Hispanic tipped workers would lose $486 million, Asian workers would lose $391 million, and tipped workers who are of another race would lose $104 million.

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The Economic Policy Institute, a nonprofit Washington D.C. think tank, was created in 1986 to broaden the discussion about economic policy to include the interests of low- and middle-income workers. Today, with global competition expanding, wage inequality rising, and the methods and nature of work changing in fundamental ways, it is as crucial as ever that people who work for a living have a voice in the economic discourse.

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