United States

DC Voters Pass Measure to Raise Tipped Workers' Minimum Wage

D.C. voters passed a measure to gradually raise the minimum wage for tipped workers to match the minimum wage for non-tipped workers.

Supporters of Initiative 77 said it protects vulnerable populations from discrimination and harassment.

Opponents said the law could end up lowering wages and put restaurants out of business.

D.C. has been hiking its minimum wage since 2014, and it will continue to rise to $15 by 2020. The minimum wage in D.C. is currently $12.50, but tipped employees are exempt and paid just $3.33 hourly. If tipped employees don't earn minimum wage with the addition of their tips, their employers are required to pay the difference.

Initiative 77 requires restaurants to annually raise the minimum wages of tipped employees by $1.50 until 2025, when the rate is set to match the $15 minimum wage for non-tipped employees.

A 2017 D.C. Department of Employment Services' Minimum Wage Economic Impact Study found that more than 27,000 employees in D.C. work for tips. More than half of those employees are not waiters or bartenders; they're hostesses, parking lot attendants and salon employees.

An audit by the department found 419 cases of employers violating the law requiring employers to pay up to minimum wage.

More than half of the D.C. Council and Mayor Muriel Bowser expressed opposition to the initiative.

Those against the initiative say workers may make less in tips than they do now because restaurants would compensate paying higher wages by raising prices or adding service charges.

Supporters of Initiative 77 argued the higher minimum wage won't stop people from tipping.

Restaurants could reduce hours or shut down their bars completely, the group against Initiative 77, Save our Tips, said on its website.

Those in favor of the measure argued it can be tough for servers worried about losing their jobs to ask their bosses for more money.

The Restaurant Opportunities Center of D.C. helps organize equal pay efforts for tipped workers around the country and formed One Fair Wage D.C. to advocate on behalf of the District initiative. The group said employees, especially women and members of minority groups, endure sexual harassment and other inappropriate behavior from customers as they work to make tips. 

Save Our Tips raised more than $300,000 to fight Initiative 77. It pulled in over $170,000 in donations from industry groups, according to financial disclosures.

The Restaurant Association Metropolitan and the National Restaurant Association cut checks worth about $150,000, the filings say. Chicago-based Lettuce Entertain You Enterprises paid about $20,000.

Another group advocating against the initiative, NO2DC77, raised over $40,000, mainly from restaurants and management groups.

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