In an emergency vote Tuesday, the D.C. Council voted to pause the increase of the tipped minimum wage in the city, which would have taken effect July 1.
Initiative 82 was passed by an overwhelming majority of D.C. voters in 2022 and entails raising the minimum wage of tipped workers — such as restaurant employees or hair stylists — from $10 to $12 in July 2025 to $17.50 by 2027.
But since Mayor Muriel Bowser announced her fiscal 2026 budget would likely repeal Initiative 82 as part of her plan to transform the city’s federally dependent economy, critics of the controversial law, including the Restaurant Association Metropolitan Washington, have voiced their support.
In a letter to the council Tuesday morning, Bowser wrote that the repeal of the law would “support the ongoing viability of our local restaurants amidst significant economic headwinds.”
In a statement Tuesday, RAMW said the emergency pause on the next phase of Initiative 82 “creates a powerful opportunity for us to look carefully at the data and listen to even more of our workers.”
“Economic conditions have changed drastically since Initiative 82 was on the ballot in 2022. It’s our shared responsibility to consider the world as it is rather than as it was,” the organization wrote.
RAMW shared in a report earlier this year that 44% of restaurant operators fear closing down in 2025. Association president and CEO Shawn Townsend told WTOP that the extra two-dollar raise that tipped workers would have gotten in July would’ve caused a $40,000-plus increase in labor costs.
Workers on behalf of One Fair Wage, a nonprofit organization that pushes for restaurant workers to receive living wages, testified Tuesday before the 8-4 vote was held and called the emergency passage “a backroom attempt to override the will of DC voters — who have twice backed the elimination of the subminimum wage at the ballot box.”‘
One Fair Wage President Saru Jayaraman said in a statement that moving to pause the increased wages would result in “extremely harmful” effects during an already contentious “affordability crisis.”
“We should be fighting for living wages and not reversing raises that voters overwhelmingly approved. The Council must stand with workers, not the corporate interests trying to undermine them,” she wrote.
‘No Tax on Tips’
Mayor Bowser also wrote to the council regarding Congress’ recent passage of the “No Tax on Tips Act,” a bill that establishes a new tax deduction, eliminating federal income taxes on up to $25,000 in cash tips of employees who make under $160,000 in 2025.
Experts say some middle-income service workers would benefit from a tax break but warn that it could heighten inequities. Among tipped workers who make enough to owe Uncle Sam, the average tax cut would be about $1,800, according to the Urban-Brookings Tax Policy Center.
RAMW also urged the D.C. Council to consider how the “no tax on tips” would “open a new path to prosperity for workers and significantly reduce the burden on restaurant owners.”
Bowser added, “The pause on increasing the tipped minimum wage will provide much needed clarity and predictability to local restaurants as these local and federal bills are being debated.”
One Fair Wage said the measure would offer “moderate relief for some” but is part of a tax package that “just helps the richest while leaving the vast majority behind.”
The Associated Press contributed to this report.
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