Restaurant workers want to claw back some of their lost tips in Philadelphia
Restaurant workers are preparing to lobby Philadelphia City Council in favor of legislation that would make it illegal for employers to take a portion of a worker's tips to defray the costs of accepting credit cards. Calculating the exact amount workers are losing is tough.
Fabricio Rodriguez leads a non-profit called "The Restaurant Opportunities Center of Philadelphia." He said in addition to restaurant workers, the legislation could help taxi drivers, hair stylists and spa workers.
"We think that as much as 25-30% of the restaurant industry is already using the practice of deducting credit card fees from peoples' tips and that's not just what a customer is intending when they leave that tip," said Rodriguez.
Rodriguez said a business owner taking a portion of a waiter's tip to cover business expenses is the same as someone stealing a tip off a table.
Patrick Conway is President of the Pennsylvania Restaurant Association. He believes the bill is well intentioned but it would add an additional burden to small business owners.
"Right now the credit card companies and banks can unilaterally charge a fee for their credit card processing fee and that fee is paid by the restaurant or the small business," said Conway. "We think a better approach would be to pass legislation that would not allow the banks and credit card companies to assess a credit card processing fee on tipped portions of the bill."
Conway said the bill could end up cutting into the money servers make. He said to avoid paying the fee charged by credit card companies, businesses may discourage customers from using credit cards for purchases. He said that could be bad for workers because people usually tip more when leaving it on a credit card than tipping in cash.