The proposed bill aims to prohibit employers from deducting credit card transaction processing fees from employee tips. It amends RCW 49.46.020 to ensure that employees receive the full amount of tips or gratuities indicated by customers on credit card slips, without any deductions for processing fees. The bill also establishes a new chapter in Title 19 RCW, which includes definitions related to electronic payment transactions, such as "credit card," "debit card," and "processing fee." Additionally, it outlines the responsibilities of payment card networks and acquirer banks regarding the handling of gratuity amounts and imposes civil penalties for violations.

Furthermore, the bill mandates that payment card networks provide a mechanism for merchants to transmit gratuity amount data as part of the electronic payment transaction process within two years of the effective date. It specifies that any entity involved in processing electronic payment transactions must not misuse transaction data and establishes penalties for violations. The act is set to take effect on July 1, 2026, unless specific funding is not provided by June 30, 2025, in which case the act would be null and void.

Statutes affected:
Original Bill: 49.46.020
Substitute Bill: 49.46.020