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Tipping point: DC Council hears pros, cons of Initiative 77 minimum-wage plan

WASHINGTON — Restaurant and bar employees, and D.C. business owners, have been voicing opinions on whether the D.C. Council should repeal Initiative 77 — a voter-approved plan that would require hospitality businesses to pay tipped employees a $15 minimum hourly wage by the year 2026.

Restaurateurs and many servers supported the repeal.

“If this isn’t repealed, it’s going to have a devastating affect on Washington,” said John Guggenmos, owner of Trade Bar Nine.

“Money doesn’t come from thin air,” Guggenmos said. “In the real world, costs have to be paid for, and we can’t pretend that’s not an integral part of the equation.”

Opponents of the repeal, including Matt Hanson, director of DC Working Families, said the council was going over voters’ heads by trying to undo the initiative, which passed with 56 percent of the vote in the June primary election.

“When voters go to the polls, we expect our decisions at the ballot box to be respected,” Hanson said.

Hanson attempted to counter the argument that restaurants and bars would have to charge astronomical prices to compensate for the large increase in hourly wages.

“At Ruth’s Steak House in D.C., the live lobster is $29 — in San Francisco it’s $29.50,” said Hanson. “I think most customers would be happy to pay a little bit more for workers to receive even better wages and tips, and that’s why voters approved it.”

However, restaurant workers, including Michael Haresign, said tipped employees, and small restaurants and bars, could be priced out of existence.

“I think it’s important to remember that $15 an hour is really zero dollars an hour if the job doesn’t exist,” Haresign said.

With 252 people set to testify before the D.C. Council, the overwhelming majority of early speakers supported repealing the initiative, saying Initiative 77 would make it near-impossible for small business owners to survive the jump.

The minimum wage in the District is $12.50 per hour, and will rise to $15 by 2020. Restaurant servers and bartenders have a lower minimum wage — $3.33 an hour, which will go up to $5 by 2020.

By law, employers currently have to make up the difference to $12.50 if employees don’t make enough in tips to reach the minimum wage.

Supporters of Initiative 77, which got on the ballot after a push from the national advocacy group Restaurant Opportunities Centers United, have said it would help reduce discrimination and harassment endured by tipped employees.


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