Washington, D.C. Mayor Muriel Bowser on Monday called for the return of the restaurant tip credit.
Two years into a three-year phaseout of the tipped minimum wage across the nation’s capital known as Initiative 82, the city’s mayor would like to see things return to the way they were before the measure was implemented in 2023, when the tipped wage was $5.35 per hour.
Bowser called for a repeal of Initiative 82 in her proposed budget for next year, which seeks to remove barriers to business growth. Restaurants in D.C. “need special attention” among the District’s industries, she said.
“We think our restaurants are facing a perfect storm with increased operating and supply costs, higher rents and unique labor challenges,” Bowser said in a press conference outlining the proposed budget.
Repealing Initiative 82 would bring the District of Columbia’s policies in line with that of Maryland and Virginia, which make up the metropolitan area known as the DMV, Bowser said.
The move to eliminate D.C.’s tip credit was approved by referendum in late 2022. The measure called for the tipped wage to increase in stages until July 2027, when tipped workers would receive the same minimum wage as non-tipped workers. The current tipped wage in D.C. is $10 per hour, and it will increase to $12 per hour on July 1. The non-tipped minimum wage is $17.50 per hour and will increase to $17.95 on July 1.
Though approved by voters, Initiative 82 has been controversial. Data has pointed to job losses in the industry, though without drawing a clear line to the tipped wage increases.
Shawn Townsend, president and CEO of the Restaurant Association of Metropolitan Washington (RAMW) urged the city council to support the repeal of Initiative 82, saying it would save jobs, save the economy and help stabilize a vital sector of the city’s economy, saying, “The industry is at a breaking point. Immediate relief is needed.”
Townsend said nearly 70% of the city’s restaurant operators have been forced to cut hours and lay off staff. In 2024, the city saw a record 74 restaurant closures. “The consequences of inaction are not hypothetical,” he said. “They’re happening now.”
Restaurants in the DMV now face the added economic pressure of what Bowser called the “DOGE economy,” with the layoff of thousands of federal workers who live in and around D.C., which has forced many to cut back on dining out.
Mike Whatley, vice president of state affairs and grassroots advocacy for the National Restaurant Association, said much has changed in D.C.’s dining scene since the city became the first jurisdiction in more than 20 years to begin eliminating the tip credit.
“In the last three years, we’ve seen beloved restaurants close, tipped employees lose their jobs, and prices go up for customers,” Whatley said in a statement. “We applaud Mayor Bowser for including a repeal of tip wage elimination in her budget. This action takes into account the real-life implications of phasing out the tip wage and will provide relief for restaurants across the city.”
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