| Chapter 245 |
| 2022 -- H 7510 SUBSTITUTE A Enacted 06/28/2022 |
| A N A C T |
| RELATING TO LABOR AND LABOR RELATIONS - TIP PROTECTION |
Introduced By: Representatives Morales, Felix, Williams, Alzate, Kislak, Tanzi, Speakman, Henries, Vella-Wilkinson, and McEntee |
| Date Introduced: February 16, 2022 |
| It is enacted by the General Assembly as follows: |
| SECTION 1. Title 28 of the General Laws entitled "LABOR AND LABOR RELATIONS" |
| is hereby amended by adding thereto the following chapter: |
| CHAPTER 14.1 |
| TIP PROTECTION |
| 28-14.1-1. Definitions. |
| Whenever used in this chapter: |
| (1) "Employer" means any individual, firm, partnership, association, joint stock company, |
| trust, corporation, receiver, or other like officer appointed by a court of this state, and any agent or |
| officer of any of the previously mentioned classes, employing any person in this state. |
| (2) "Service charge" means a compulsory fee charged by an employer to a patron. |
| (3) "Tip" means voluntary monetary compensation received directly or indirectly by the |
| employee for services rendered. |
| (4) "Tipped employee" means any employee engaged in an occupation in which the |
| employee customarily and regularly receives more than thirty dollars ($30.00) a month in tips. |
| 28-14.1-2. Restrictions on tip pooling. |
| (a) A tip is the sole property of the tipped employee. Any arrangement between the |
| employer and the tipped employee whereby any part of the tip received becomes the property of |
| the employer is prohibited. |
| (b) The requirement that an employee must retain all tips does not preclude a valid tip |
| pooling or sharing arrangement among employees who customarily and regularly receive tips. |
| (1) An employer must notify its employees of any required tip pool contribution amount, |
| may only take a tip credit for the amount of tips each employee ultimately receives, and may not |
| retain any of the employees' tips for any other purpose, except as provided in § 28-14.1-4. |
| (2) An employer that pays the full minimum wage and takes no tip credit may allow |
| employees who are not tipped employees to participate in the tip pool. This shall not apply to |
| exempt employees as defined by section 13(a)(1) of the Fair Labor Standards Act as defined by |
| regulations 29 C.F.R. Part 541. |
| 28-14.1-3. Service charges. |
| Service charges are part of the employer's gross receipts. Sums distributed to employees |
| from service charges cannot be counted as tips received, but may be used to satisfy the employer's |
| minimum wage and overtime requirements pursuant to the provisions of §§ 28-12-4.1 and 28-12- |
| 5. If an employee receives tips in addition to the compulsory service charge, those tips may be |
| considered in determining whether the employee is a tipped employee and in the application of the |
| tip credit. |
| 28-14.1-4. Credit cards. |
| Where tips are charged on a credit card and the employer must pay the credit card company |
| a percentage on each sale, the employer may deduct that percentage from the employee's tips, |
| provided that the employer notifies the employee of the deduction. This charge on the tip may not |
| reduce the employee's wage below the required minimum wage. The amount due the employee |
| must be paid no later than the regular pay day and may not be held while the employer is awaiting |
| reimbursement from the credit card company. |
| SECTION 2. This act shall take effect upon passage. |
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| LC003950/SUB A |
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