Tipping? It's complicated

Checking in on DC's minimum wage fight with Washingtonian's Jessica Sidman

photo via Unsplash

Update: On June 3, the DC Council voted to delay the next tipped minimum wage increase until October.

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Tipping is back in the news, this time thanks to a pair of bills working through Congress that seek to eliminate federal income tax on tips. The idea plays well in headlines: Employees that earn much of their income from tips will be taxed less. But economists say if implemented, it could harm more people than it helps. Like most policies trying to regulate, or even eliminate, tipping, it’s divisive.

There’s a second, localized tipping fight happening in our nation’s capital worth paying attention to. In 2022, voters passed a ballot measure to change how tipped workers in Washington, DC earn base wages. Three years in, there are calls for change… again.

Tips have long been a controversial form of compensation in restaurants with roots in slavery and racism. Detractors say tipping creates a power imbalance between diner and employee and can perpetuate inequalities based on race, gender, and other factors. But the practice is so far entrenched in the restaurant industry that it’s proving challenging to climb out of.

In some states, employers can pay tipped workers a subminimum wage, with the guarantee that they’ll make take home at least the standard wage; a portion of their tips goes toward making up the difference. DC has a tipped minimum wage, too, but in 2022 District voters overwhelmingly passed Initiative 82, which phases it out by gradually raising the tipped minimum, which was then $5.35 per hour. It went into effect in May 2023, and the tipped minimum has increased incrementally since. It’ll rise again on July 1, from $10 to $12 per hour.

This law, too, is contentious. As recently as March, One Fair Wage, an advocacy group that helped champion the legislation, called it a “success story” it wants to replicate in more places. (A similar measure in Massachusetts did not pass last November.) In a recent report, the org cites data from restaurant point of sale company Toast that “shows that DC workers continue to enjoy strong hourly averages in tips.” Additionally, it says employment at full service restaurants in the District has remained steady.

But a recent analysis from the Employment Policies Institute, a nonprofit research org, found that the initiative has cost DC employees $11.8 million in potential earnings.

Now, calls to ditch the law are gaining traction. A few weeks ago, DC Mayor Muriel Bowser joined the call to repeal the law as part of her 2026 budget.

Why? Well, it’s complicated. So complicated, that I had trouble keeping up from across the country. I asked Jessica Sidman, food editor at D.C.’s Washingtonian, to explain what’s happening on the ground. In our interview, she lays out the stakes from both sides… but no one knows what happens next.

Our conversation has been lightly edited for length and clarity.

Expedite: I remember when voters passed this initiative. It was popular.

Jessica Sidman, Washingtonian: “Initiative 82 passed overwhelmingly in 2022, with about three-fourths of the vote. This is actually the second time that voters have passed an inactive like this. There was a similar ballot measure in 2018 approved by voters, but later overturned by the DC Council.”

I didn’t know that! Who was behind the most recent effort? The same people?