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Committee advances bill to codify tip-pooling rules and cut off litigation
Summary
The Employment, Labor and Pensions committee passed SB 245 to codify federal tip-pooling regulations into state law and make the change retroactive to 2023; sponsor said the bill will preserve industry practice and end a pending lawsuit. The committee approved the bill 12-0.
Senator Freeman introduced Senate Bill 245 on tip pooling, saying the measure would put the federal regulatory framework for tip pools into state law and blunt litigation that followed recent federal regulatory shifts.
"All this bill will do is codify in state law the federal regulations regarding this to allow for tip pulling," Freeman said, and added that the measure "is gonna it's retroactive, until, like, 2023, and we're shutting down a lawsuit." He told members the bill reflects long-standing industry practice and is intended to stop what he described as frivolous suits against local establishments.
Representative Mosley asked whether the retroactivity would make any current lawsuit moot; Freeman replied that was his intention and that it "should." Committee members with industry experience, including Representative Issa, said the bill aligns with standard restaurant practice. Representative Abbott framed the bill as codifying existing practice rather than changing how tips are distributed.
Chip Garver, counsel for Tony’s (Fegree Dreaker), testified in support and asked the committee to move the measure forward, saying he agreed with the sponsor’s presentation.
After brief discussion, a committee member moved to pass SB 245; the motion carried on a recorded/announced tally of 12-0. The measure advanced out of committee.
The next step for SB 245 is assignment to the next committee or floor scheduling according to chamber rules.
