Mulvaney, Acosta Override Regulatory Office to Hide Tips Rule Data

Labor Department leadership convinced OMB Director Mick Mulvaney to overrule the White House regulatory affairs chief and release a controversial tip-sharing rule without data showing it could allow businesses to skim $640 million in gratuities.

Mulvaney sided with Labor Secretary Alexander Acosta over the government’s rulemaking clearinghouse—a little-known but critical wing of the White House called the Office of Information and Regulatory Affairs—three current and former executive branch officials told Bloomberg Law. That allowed the department to delete from the proposal internal estimates showing businesses could take hundreds of millions in gratuities from their workers.

The proposed rule, which reverses ...