Raising the Tipped Minimum Wage Won’t Harm the Restaurant Industry

Elizabeth Falcon

 June 10, 2025

FacebookTwitterRedditBlueskyEmail

Photograph Source: Canadian2006 – CC BY-SA 4.0

This week, the D.C. Council voted to pause a wage increase related to Initiative 82, the 2022 ballot measure that incrementally raises the tipped wage. The law, which was passed with 74 percent of the vote, will eventually bring tipped workers’ wages up to the minimum wage.

The initiative has been under renewed scrutiny from some lawmakers and Mayor Muriel Bowser, who proposed last week in her 2026 budget to repeal the law entirely.

“We have been alarmed over the last several years with the changes to the [restaurant] industry, [some] outside of our control but some within our control,” the mayor said at an event last month. “We think our restaurants are facing a perfect storm with increased operating and supply costs, higher rents, and unique labor challenges.”

Mayor Bowser and her allies on the council are caving to misguided talking points from the Restaurant Association of Metropolitan Washington, an industry group, that restaurants are on a decline — and that it’s Initiative 82’s fault.

But the facts simply do not bear that out. There is no evidence that I-82 is harming restaurants or workers. According to the U.S. Bureau of Labor Statistics, between 2022 and 2024 (through November), employment at full-service restaurants in the District grew 8.7 percent. In the surrounding metro areas, the increase was only 5.4 percent. Self-reporting that restaurants feel like they might close is not the same as having data that the industry is not doing well.

In fact, many restaurants are making new investments in D.C. In the past 18 months, STARR Restaurant Group, which operates Le Diplomate and St. Anselm, has opened four new restaurants in the city. Data from the D.C. Council’s own budget office shows that in the last 10 years, the three months with the highest levels of restaurant employment were in the last two quarters (Q4 2024 and Q1 2025, see graph on p1), and there are more full-service restaurants (see graph on p4) and restaurant liquor licenses in D.C. than there were before I-82. While there are many anecdotes of restaurants closing, the overall industry is doing better than it ever has.

Before I-82 passed, my workplace, D.C. Jobs with Justice, put out a study of the accuracy and rate of reporting into D.C.’s Tip Portal. This tool should tell us what workers are actually making and confirm there is no wage theft (restaurants are required to pay workers up to the minimum wage if they don’t make that much in tips). However, in the year we studied, only 11 percent of D.C. businesses reported every quarter, and 64% never reported at all. There is currently no transparency into the actual wages of tipped workers.

In their fight against I-82, the restaurant lobby has already won concessions. The council passed a bill last year protecting restaurants from private lawsuits over deceptive marketing related to service fees, which many have implemented to make up for increased labor cost (and which have resulted in confusion and lost wages for servers, bartenders, and other workers).

At the same time, RAMW argued D.C. should speed up implementation, claiming that they were ready to “put the past behind us” in testimony to the D.C. Council. This claim made me skeptical as they have consistently opposed wage increases and seemed to be pushing for more instability in the industry by creating a massive one-time wage increase rather than a gradual one. That portion of the bill was rejected by the D.C. Council, which chose to stay the course on I-82. Now, RAMW has come clean. They want to overturn I-82, and they want to reduce workers’ wages.

Unfortunately, the D.C. Council is buying their inconsistent arguments. Eight councilmembers voted to pause the planned wage increase for clarity. I-82 is the law and is extremely clear already: every year, the tipped minimum wage will increase on July 1. Instead of clarity, the council offers chaos to the workers who were counting on a pay increase next month.

The council has many pressing issues to address in the D.C. budget—issues with fiscal impacts that affect D.C.’s ability to raise and spend revenue on needed services. This is not one of them, and the council should swiftly and decisively move on from conversations about changes to I-82 and on to the important work of funding our government services.

This piece originally appeared in The 51st, a worker-led nonprofit newsroom covering Washington, D.C.

Elizabeth Falcon is the Executive Director of DC Jobs With Justice.