This Op-Ed Piece was Published by Gatehouse News/Wicked Local which owns over 60 weeklies and 7 Daily Newspapers in Massachusetts.

Throughout this election season we have heard candidates denounce regulations that hamper small businesses. Their logic is simple: when government simplifies regulations, business owners are free to expand and hire new workers.

In Massachusetts, one regulation is not only harming small businesses, it’s also taking money out of the pockets of employees in virtually every city and town. Massachusetts’ tip-pooling law is preventing people who work behind the counter at Dunkin’ Donuts and other quick service restaurants from receiving tips.  Leaving extra change—or an occasional dollar bill—in a tip cup is a time-honored tradition for Bay State coffee drinkers. Since the early days of Dunkin’ Donuts, when people sat at counters enjoying a hot cup of coffee, customers have enjoyed the freedom to leave a tip as a reward for excellent service, often from someone they see every morning.

In 2004—in response to news stories detailing how managers at high-end restaurants and banquet facilities were forcing workers to give them a cut of their tips—the Legislature changed the statute covering tip pooling to prevent those with any “managerial authority” from sharing in the pool.  The law rightly protects waiters and bartenders in casual and fine-dining establishments from managers who take a cut of the tips, but has had an unintended consequence for low-wage workers who lose the extra income.

At Dunkin’ Donuts and other quick service restaurants, shift supervisors and others with “managerial authority” spend the balance of their time serving customers. These workers earn only slightly more per hour but, because of the law’s ambiguity, have been lumped together with managers that have the power to hire and fire.

After the law was changed, it didn’t take long before trial lawyers began exploiting the law’s indefinite terminology. Since 2004, multiple lawsuits have been filed against Dunkin’ Donuts franchise owners, costing them millions of dollars in fines and settlements. Many have responded by eliminating tip cups entirely.  In Massachusetts there are over 1100 Dunkin’ Donuts shops that employ over 25,000 people; these shops are all independently owned and operated.

Then, in an amazing legal turnabout, a franchise owner was sued last year because he removed the tip cup and eliminated the employees’ ability to augment income with tips. It is sadly ironic that the law has been exploited to enrich powerful lawyers and deny tips to ordinary servers who’ve worked hard to earn them.

A Massachusetts-based association of Dunkin’ Donuts franchise owners (DDIFO), which is independent of Dunkin’ Brands, has stepped in to propose narrow changes to the existing law to treat quick serve restaurants differently than fine dining establishments and banquet facilities.  The changes would clarify how and when tips can be accepted and pooled and would remove the ambiguity that surrounds “managerial authority”. The changes will protect employees who rely on tips to supplement their income, and enable business owners to continue investing in building more businesses which create jobs, pay taxes and support local communities.

Regulations can play an important role in protecting workers and the marketplace, but when these regulations punish business owners and their employees, everyone suffers.

Jim Coen is President of the DD Independent Franchise Owners Association, which represents owners of over 2500 Dunkin’ Donuts shops in the U.S.

This Op-Ed Piece was Published by Gatehouse News/Wicked Local which owns over 60 weeklies and 7 Daily Newspapers in Massachusetts.