Reps fighting over tips
By Kevin Huelsmann, Jackson Hole, Wyoming
February 14, 2013
A bill that would let employers oversee tip distribution programs for their staff won a final Senate approval Wednesday.
But senators also tacked on an amendment frequently criticized by many legislators, including the bill’s sponsor, Jackson Republican Rep. Ruth Ann Petroff.
LaGrange Republican Sen. Curt Meier narrowly pushed the amendment through the Senate on Wednesday, during the bill’s final reading.
Immediately after, members of the House voted against the new version of the bill.
That triggered a conference committee, whose members will seek a compromise between the two versions.
The amendment changes a reference to minimum wage in the bill. The initial version said money could be collected from employees and put into the tip pool only after they had reached the federal minimum wage. Meier’s amendment changed that so it referred specifically to the minimum wage for “non-tipped employees.”
Federal minimum wage for a tipped employee is $2.13 an hour. For non-tipped staffers, it’s $7.25 an hour.
Meier said the amendment would ensure that Wyoming employers comply with federal standards. It also would make clear that employers are responsible for meeting the minimum wage, not employees, he said.
But the change is a killer for some.
“This makes it where it’s an unworkable system,” said Sen. Ogden Driskill, R-Devil’s Tower.
Petroff said the amendment goes too far outside her bill’s intention by changing the minimum wage requirement. It also has the potential to create some untenable situations for employers, she said.
“Basically, if you have a restaurant, even if you don’t want to have a tip-pooling arrangement, your employers could get together and say, ‘We want to have an organized system,’ ” Petroff said. “Then they could force higher wages.”
Petroff is one of three representatives who will serve on the conference committee. Senate leaders have not picked their three members — two who voted in favor and one who voted against the bill.
The members of the committee likely will convene early next week, Petroff said. Once they settle on a compromise, the bill must go through each chamber once more.
Senators also approved another amendment to the bill. That one, however, was welcomed by supporters of the legislation.
The amendment would make it clear that employees have the ability to opt out of any tip distribution program.
Petroff’s bill seeks to create a formal program to replace the “loosey-goosey” system that’s in place now, said Chris Brown, executive director of the Wyoming Lodging and Restaurant Association.
“The intent of the bill all along is to give employers an opportunity to have a system that governs the tipping out that already occurs between staff,” Brown said, adding that Wyoming is one of only three states that doesn’t allow employers to oversee this process.
The legislation was one of two tip-related bills Petroff had before the Senate on Wednesday.
House Bill 111 make all tips exempt from sales tax. Existing state law requires restaurants to charge sales tax on tips that are automatically added to a bill, most often for large groups.
The bill would exempt all gratuities from taxation, regardless of whether they are voluntarily offered or added to a diner’s bill.