Washington, D.C. voters passed Initiative 77 this past June. Initiative 77 eliminated the tipped minimum wage.
If you’re wondering what the tipped minimum wage is, you’re not alone. In Washington, D.C. minimum wage is $12.50 per hour (and it is set to rise to $15 by 2020). This minimum wage, however, does not apply to tipped workers. The minimum wage for tipped workers – servers, bartenders, and others – is $3.33.
That base hourly wage may shock you at first, but Washington, D.C. law requires employers to make up the difference if tipped workers fail to earn at least $12.50 (or the current minimum wage) per hour through gratuity. Initiative 77 would have gradually raised that $3.33 minimum wage for tipped workers to the standard minimum wage of $12.50.
Essentially, tipped workers would no longer rely on the generosity of strangers to meet the minimum wage. Opponents argue, however, that tipped workers actually make more than the minimum wage, so doing this would hurt rather help them.
Council Overturns Votes
Initiative 77 was on the ballot in D.C. this past June, and it passed by more than 8,000 votes. The Washington, D.C. Council however – a council made up of 13 elected members (one member from each of the eight wards and five others, including the Chairman, elected at large) – voted to repeal Initiative 77 just last week. Councilmembers claim that the wording of the initiative was misleading and most who voted in its favor didn’t realize what they were doing. They claim the initiative would have resulted in a pay cut for tipped workers and put an undue burden on businessowners – especially small, independently owned restaurants.
Proponents of eliminating the tipped minimum wage argue that doing so helps prevent sexual harassment. They claim that servers are subjected to higher rates of sexual harassment but are less likely to report it when they work in states where there is a tipped minimum wage. It makes sense that those servers who rely on the generosity of strangers are less likely to complain about patrons’ conduct for fear of receiving a smaller tip – or no tip at all. Proponents also argue that laws requiring employers to make up the difference between the minimum wage and the tipped minimum wage are not enforced and too lax.
Alaska, California, Minnesota, Montana, Nevada, Oregon, and Washington have all passed similar initiatives that eliminate the tipped minimum wage. However, no one seems to be able to agree on whether eliminating the tipped minimum wage has resulted in a positive outcome. Studies have been done and statistics have been released, but they are inconsistent, so it really depends on whom you ask.
One other thing to consider is that Initiative 77 would not have banned tipping – restaurant-goers would still be free to tip as they saw fit, but servers and bartenders would no longer be relying exclusively on patrons’ generosity, and the amount of their pay would be more reliable week to week. On the other hand, some restaurant owners have said that they would initiate a mandatory service charge to help cover the higher cost of payroll, which they would not be required to share with their employees. So, restaurant goers would be paying more for their meal, but that higher cost would likely not be shared amongst employees.
While the benefits or drawbacks to eliminating the tipped minimum wage are not yet apparent, what is apparent is that a council in Washington, D.C. has overturned an initiative their constituents approved through a referendum. That fact might be the most important message here. The council has essentially told its constituents that they can’t be trusted to read, interpret, and vote on an initiative, and that they can and will overturn the voice of the very people who granted them the power to do so.
In the Council’s defense, it did attempt to address issues like sexual harassment by requiring more training for employers, employees, and owners.