Bill Overview
Title: Small Business Flexibility Act
Description: This bill allows the pooling of tips among employees who (1) customarily and regularly receive tips (as under current law), (2) customarily and regularly receive tips and are paid at least minimum wage, and (3) do not customarily and regularly receive tips.
Sponsors: Rep. Biggs, Andy [R-AZ-5]
Target Audience
Population: Service industry employees who are involved in tip pooling
Estimated Size: 11000000
- The bill specifically addresses the notion of tip pooling, which directly impacts employees who work in service industries where tipping is common, such as waitstaff or bartenders.
- The bill extends to include employees who are paid at least minimum wage and those who do not normally receive tips, broadening the impacted population.
- In the United States, the service industry accounts for a significant portion of the workforce. According to the Bureau of Labor Statistics, there are millions of workers in the bar, restaurant, and other service-related industries like hospitality, personal services, etc.
Reasoning
- The Small Business Flexibility Act primarily impacts employees in service industries where tipping is customary, such as restaurants and bars.
- The policy introduces a more inclusive tip pooling system, potentially affecting service industry hierarchy and incentives.
- The budget constraints necessitate focusing on a representative sample of workers both directly and indirectly affected by the policy.
- The simulated interviews reflect a diverse range of situations, such as direct impact on waitstaff and broader implications for those in non-tipped roles within the same organizations.
Simulated Interviews
Waitress (New York City, NY)
Age: 25 | Gender: female
Wellbeing Before Policy: 5
Duration of Impact: 5.0 years
Commonness: 15/20
Statement of Opinion:
- I think it's a fair policy. Those who work hard in the back deserve a share too.
- My main concern is that it might reduce overall tip amounts because tips are often a reward for personal service.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 5 |
| Year 2 | 7 | 5 |
| Year 3 | 7 | 5 |
| Year 5 | 8 | 5 |
| Year 10 | 7 | 5 |
| Year 20 | 6 | 5 |
Bartender (Austin, TX)
Age: 32 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 3.0 years
Commonness: 12/20
Statement of Opinion:
- I depend on my tips, and sharing them means I could lose out.
- However, it might create a better team environment if everyone is sharing the rewards.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 7 | 7 |
| Year 5 | 7 | 7 |
| Year 10 | 6 | 7 |
| Year 20 | 6 | 7 |
Hostess (San Francisco, CA)
Age: 29 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 10.0 years
Commonness: 8/20
Statement of Opinion:
- I've never really gotten tips myself, so it could be nice to see some cut from the pool.
- Policies like these encourage fairness in the workplace.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 7 | 6 |
| Year 5 | 7 | 6 |
| Year 10 | 8 | 6 |
| Year 20 | 7 | 6 |
Chef (Chicago, IL)
Age: 45 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 1.0 years
Commonness: 5/20
Statement of Opinion:
- It’s interesting to be included, wasn't expecting this change.
- As long as this doesn’t negatively affect customer experiences, I'm indifferent.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 7 | 7 |
| Year 5 | 6 | 7 |
| Year 10 | 6 | 7 |
| Year 20 | 6 | 7 |
Dishwasher (Miami, FL)
Age: 38 | Gender: female
Wellbeing Before Policy: 4
Duration of Impact: 10.0 years
Commonness: 10/20
Statement of Opinion:
- This policy will help people like me who work hard behind the scenes.
- It feels good to be recognized and valued in this way.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 4 |
| Year 2 | 6 | 4 |
| Year 3 | 7 | 4 |
| Year 5 | 7 | 4 |
| Year 10 | 8 | 4 |
| Year 20 | 7 | 4 |
Busser (Columbus, OH)
Age: 22 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 2.0 years
Commonness: 13/20
Statement of Opinion:
- Including non-tipped staff might thin out the pool, but it also feels fair.
- I'm hopeful that it leads to more cooperation among staff.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 7 | 6 |
| Year 5 | 7 | 6 |
| Year 10 | 6 | 6 |
| Year 20 | 6 | 6 |
Barista (Seattle, WA)
Age: 27 | Gender: female
Wellbeing Before Policy: 8
Duration of Impact: 1.5 years
Commonness: 14/20
Statement of Opinion:
- This could lead to less motivation for personal excellence in customer service.
- On the other hand, teamwork could improve as everyone is interconnected through tips.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 8 |
| Year 2 | 7 | 8 |
| Year 3 | 8 | 8 |
| Year 5 | 8 | 8 |
| Year 10 | 8 | 8 |
| Year 20 | 7 | 8 |
Restaurant Manager (Denver, CO)
Age: 35 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 5.0 years
Commonness: 4/20
Statement of Opinion:
- It's going to shake things up, but could eventually lead to more equity if rolled out right.
- Main concern is initial resistance and potential drop in staff efficiency.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 6 | 6 |
| Year 5 | 7 | 6 |
| Year 10 | 6 | 6 |
| Year 20 | 6 | 6 |
Food Runner (Portland, OR)
Age: 28 | Gender: male
Wellbeing Before Policy: 5
Duration of Impact: 4.0 years
Commonness: 9/20
Statement of Opinion:
- As a food runner, I do quite a bit in the service experience, so tipping pool inclusion is appreciated.
- This policy is innovative and seems to promise greater fairness.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 5 |
| Year 2 | 6 | 5 |
| Year 3 | 7 | 5 |
| Year 5 | 7 | 5 |
| Year 10 | 6 | 5 |
| Year 20 | 5 | 5 |
Receptionist (Atlanta, GA)
Age: 40 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 1.0 years
Commonness: 7/20
Statement of Opinion:
- Interesting to see a policy potentially affecting pay structure in our industry.
- Though not directly impacted, I am concerned about changing dynamics among service staff.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 7 | 7 |
| Year 5 | 7 | 7 |
| Year 10 | 7 | 7 |
| Year 20 | 7 | 7 |
Cost Estimates
Year 1: $2000000 (Low: $1000000, High: $3000000)
Year 2: $1500000 (Low: $750000, High: $2500000)
Year 3: $1000000 (Low: $500000, High: $2000000)
Year 5: $500000 (Low: $250000, High: $1000000)
Year 10: $500000 (Low: $250000, High: $1000000)
Year 100: $500000 (Low: $250000, High: $1000000)
Key Considerations
- The policy pertains mainly to labor law adjustments rather than financial expenditures.
- Any cost implications would largely be administrative for federal agencies overseeing labor compliance.
- There could be uncertain economic behavior adjustments as employees' tip income dynamics change.