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Guest MINDSETTER™ Joey L DeFrancesco: Senate Drops Ball on Tip Theft Bill

Friday, June 22, 2012

 

Our state Senate missed a big opportunity to help working Rhode Islanders last week when the Labor Committee allowed a bill to end tip-theft die even after it had overwhelmingly passed the House.

That means it's still perfectly legal in our state for employers to skim off as much of workers' gratuities as they want so long as they don't drive anyone below minimum wage. There's no federal law against the practice, and it happens a lot more than you think.

I experienced tip stealing firsthand over the three years I worked as a Room Service server at the Renaissance Providence Downtown Hotel. I depended on gratuities to pay my bills because I only made $5.50/hr, but I wasn't allowed to take home all the tip-money I was earning. The hotel's tipping system was a convoluted set-up of “Service Charges” and “Additional Gratuity” lines where both the company and our supervisors were dipping into my money. At the end of the day, I was taking home less than half of what customers thought they were giving me.

Existing laws aren't sufficient to stop this kind of robbery. In 2011 I filed a complaint with the US Department of Labor over the hotel's gratuity system. After a few months of investigating the DOL told me that yes, the company was stealing my tips, but because I still kept enough to make minimum wage they couldn't do anything about it.

My hotel isn't an isolated case. Speak with anyone who's been in the industry long enough and they'll have a similar story. While talking with workers about the legislation, I heard about tip-theft happening everywhere from small bistros on Thayer St. and Federal Hill to big corporate fast-food chains. Sometimes bosses steal tips through deceiving service charges, sometimes by taking a portion of credit card tips, and sometimes by bluntly demanding a cut of a worker's cash at the end of a shift.

A few states have already banned the practice, including Massachusetts, New York, and California. In those states, workers have effectively used their laws to fight back against unfair employers. In one recent high-profile case, employees at celebrity chef Mario Batali's New York restaurants won $5.25 million as backpay for years of stolen tips.

Tip theft isn't just an problem for workers—it's also a scam to consumers. When diners leave a tip, they intend their money to go to servers. If that money is redirected by disingenuous bosses or misleading service charges, the customer is being defrauded.

The tip theft bill wouldn't hurt RI businesses. It adds no taxes or fees to restaurant owners' bills. It simply ensures low-wage workers are getting the gratuities they deserve, and that customers' money is going where they intend it to go.

It's a shame the Senate didn't push this common-sense law through. Still, the legislation generated enough press that many Rhode Islanders are now aware of an injustice largely unknown beyond service workers, and that's a big victory. We'll be back with another bill next year, but for now tip theft will continue legally in Rhode Island--so be sure to ask your server where that credit card tip or service charge really ends up.

Joey L DeFrancesco is a former hotel worker and rank-and-file union organizer. Since his viral video of him quitting his hotel job, “Joey Quits,” he's pursued service worker activism through his website http://www.joeyquits.com and elsewhere. He helped to create and promote the Rhode Island tip-theft bill submitted by State Rep. Chris Blazejewski (D-Dist. 2, Providence, East Providence).

 

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