While personally I try to avoid establishments that utilize tip pooling, reading through all the arguments and most of the links, I cannot argue for the added federal level of involvement in this aspect of labor.
From one of the articles links:
Promulgation of the regulation would also make clear that where an employer does not claim the tip credit under section 3(m) and pays a direct wage that satisfies the FLSA’s minimum wage requirements, the treatment and disposition of tips is a matter of agreement between the employer and employees or of state law.
end quote
In the long run, employers who decide to 'tip-pool' will face issues of employee retention, employee poaching, trickling down to customer retention and it will balance out in the end. The market will drive these employers to offer good wages to good servers to retain their services. Additionally, the rule change does not ban server retained tips, leaving that part of the employment contract to the individual business.
From one of the articles links:
Promulgation of the regulation would also make clear that where an employer does not claim the tip credit under section 3(m) and pays a direct wage that satisfies the FLSA’s minimum wage requirements, the treatment and disposition of tips is a matter of agreement between the employer and employees or of state law.
end quote
In the long run, employers who decide to 'tip-pool' will face issues of employee retention, employee poaching, trickling down to customer retention and it will balance out in the end. The market will drive these employers to offer good wages to good servers to retain their services. Additionally, the rule change does not ban server retained tips, leaving that part of the employment contract to the individual business.
