WHD faces audit over handling of tip pool regulations
- The U.S. Department of Labor's Office of Inspector General is initiating an audit of the rulemaking process used by the Wage and Hour Division (WHD) to rescind Obama-era tip pooling rules, it said in a Feb. 5 letter.
- The letter, sent to WHD's acting administrator, came shortly after it was revealed the division omitted an internal analysis from its December Notice of Proposed Rulemaking (NPRM).
- The NPRM proposed to roll back regulations that limited employers' ability to require that tipped employees share their gratuities with non-tipped employees. DOL's analysis that senior officials scrapped noted that, if adopted, the rescission could allow employers to pocket tips themselves, according to a Bloomberg BNA report.
The news comes on the heels of a similar announcement from the National Labor Relations Board's inspector general. There, a Board member faces an investigation over concerns that he shouldn't have weighed in on an action concerning a joint employment case because it involved his former law firm.
It's not clear what effect these investigations will have on the outcome of these issues, but if nothing else, they may at least delay final resolution of some questions that have plagued employers for some time.
Simultaneously, a petition to review the tip pool rules is pending before the U.S. Supreme Court. DOL has obtained several extensions to reply to the petition but, in light of the rulemaking process, it seems likely that the agency will tell the Court that it doesn't need to hear the case now.
- U.S. Department of Labor Initiation of Audit: Tip Regulations under the Fair Labor Standards Act
- HR Dive Ethics investigation at NLRB centers on joint employer question
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