The District of Columbia Tip Credit Elimination Act of 2021, more often referred to as “Initiative 82,” passed with overwhelming support. It received about 74 percent of the votes in-favor with 94 percent of votes counted as of Nov. 21. The initiative will gradually increase the tipped minimum wage to $16.10, plus tips, by 2027. Before the bill’s passage, the District required employers to pay tipped employees $5.35 an hour and supplement workers if they didn’t earn the equivalent of the standard minimum wage of $16.10 plus tips.
Maria Quinn (SFS ’25) started working as a server at The Tombs this semester. Last spring, she also worked as a tipped worker at bubble tea restaurant Gong Cha.
“You usually make more [than $16.10 an hour],” Quinn said. “It’s usually more like 20 bucks an hour.”
With the new initiative, tipping wouldn’t go away. Tipped workers would simply rely less on the money of customers for continuity in their paychecks.
“I don’t know if a lot of people realize that [employees are] getting paid the restaurant minimum wage, which is five bucks,” Quinn said. “So the tips are really, really important to supplement that income.”
A recent report released by DC Jobs with Justice stated that only 11 percent of D.C. restaurants consistently reported their wages to the Department of Employment Services, despite all restaurants being required to do so. During the four quarters investigated, 64 percent of restaurants failed to report at all. The report was based on data collected before July, when the subminimum wage was raised from $5.05 to $5.35.
Wage theft within the restaurant industry is “pretty rampant,” proposer of Initiative 82, Ryan O’Leary, said. “Some of the restaurants that have reported are reporting that they’re paying everybody $5 an hour or $4.45 an hour,” he said.
O’Leary blamed the wage theft on the tipped subminimum wage. “Why is the restaurant industry special for having so many wage theft violations? It’s because of the subminimum wage,” he said. “It overly complicates the way in which workers get paid and it keeps them in the dark for when they’re not being paid what they should be.”
Initiative 82 supporters also often cite the racist and sexist origins of tipping culture. After the Civil War, tipping gained popularity among employers in the United States who did not want to pay their workers. Women who work as tipped laborers, and especially women of color, often have to withstand harassment to earn tips: “The price of resistance would be the loss of tips that I had rightfully earned,” former waitress Michelle Alexander for the New York Times wrote.
“In states that don’t have a subminimum wage, the pay gaps for women and people of color are lower,” O’Leary said.
Eliminating the tipped minimum wage may also improve socioeconomic conditions for workers, according to O’Leary. “In every state that’s eliminated the subminimum wage, the poverty rate amongst workers has gone down, their incomes have gone up, and businesses still thrive,” said O’Leary said. “I think this is an important thing for us to do as a progressive leader in this country.”
Many restaurants and tipped workers fought hard against the initiative. While Quinn supported the initiative, she was conflicted about some of its possible effects.
“The money has to come from somewhere, so that means that restaurants will probably have to raise prices or raise surcharges,” Quinn said. “I’m not really sure how restaurants would budget it.”
Geoffrey Tracy (COL ’95), owner of D.C.’s Chef Geoff’s and Chef Geoff’s West End, has been vocally opposed to the initiative. He was also the president of the Vote No on 82 campaign.
“Tipped employment is an option. It’s just one choice that a potential worker could try to find,” Tracy said. “It’s really up to the person seeking the job.” Tracy said he sees the initiative as taking away the employment options available to potential employees. With the introduction of Initiative 82, Tracy’s tipped employees could see an increase in wages from their current rates of about $35 or $40 an hour, up to possibly $45 or $50 an hour.
“I think that’s excessive when you look at the wages that, say, line cooks make, which is around $20,” Tracy said. “That crests a sort of struggle. Should a server be making $40 an hour when a sauté cook is making $20? ”
To supplement the wage increase, Tracy is leaning towards adopting a “quasi-service charge” system. For example, instead of the restaurant asking customers to pay 20 percent of the bill directly to the worker, customers would be charged a 10 percent service charge alongside a 10 percent tip. The service charge would offset the increase in payroll. Other restaurants are considering replacing tipping with service charges, said Tracy. One complication Tracy noted is that this system presents is that the sales tax, paid by customers, applies to the service charge, whereas the tax on tips is paid by the employee.
“I am shocked that we allowed a ballot initiative to decide these complex economic issues,” Tracy said.
Some tipped workers lobbied against the initiative. “I make well above $26 per hour, which is the D.C. average [for tipped workers], on a consistent and regular basis,” one tipped employee wrote in a post on Vote No on 82’s website. “If Initiative 82 were to pass, my ability to earn a sustainable salary that allows me to live and work in this city would be eliminated”
Initiative 82 won an even greater percentage of the popular vote than the almost identical Initiative 77 won in 2018. The DC council voted 8-5 to repeal Initiative 77 a few months after its passage.
Before the election, O’Leary said he was confident about winning the popular vote. “I just want to make sure that we win by more than we did with Initiative 77,” said O’Leary. “Six of the 13 council members have signed a pledge that I wrote up that explicitly states they will not amend, alter, or overturn this initiative in any way that is contrary to the spirit of the initiative.”
According to an article published in the DCist in 2016, only around 30 percent of District workers live in the city, with the number of low-wage workers who call the District home rapidly decreasing as the cost of living increases. As a result, many of the people most affected by this measure did not have the ability to vote on the initiative.
“The people who feed us and serve us should also be able to live here,” O’Leary said.
Quinn, who is from a suburb of Chicago, said it can be strange to have her income decided by an election she can’t vote in. “It makes me think. I don’t have the power to change this,” she said. “This is something that affects me so directly and I don’t have much of a say in it.”