On November 8, 2022, voters in Washington, D.C. chose to eliminate the lower minimum wage—called the tipped minimum wage or tip credit rate—for tipped workers by approving ballot Initiative 82.
The tipped minimum wage allows establishments whose customers pay partially via tips, such as restaurants, salons, parking facilities, etc., to pay employees a sub-minimum wage of $5.35 per hour, as long as employees make up the rest of the full minimum wage, currently $16.10 per hour, in tips. If they do not make up the rest in tips, the establishment must “true them up” to make up the difference.
The passage of Initiative 82 means that, assuming the D.C. counsel does not overturn it (as it did in 2018, although this is not likely to happen again) and assuming it makes it through the 30-day congressional review period, D.C. tipped establishments will have a phase-in period to slowly bring their employees up to the full minimum wage by 2027. As it currently stands, the phase-in schedule would be as follows:
| Date (on or before) | Minimum Wage Requirement |
| January 1, 2023 | $6.00/hr. |
| July 1, 2023 | $8.00/hr. |
| July 1, 2024 | $10.00/hr. |
| July 1, 2025 | $12.00/hr. |
| July 1, 2026 | $14.00/hr. |
| July 1, 2027 | Minimum wage |
This means that tipped establishments in D.C. will need to make changes. Establishments could raise prices to offset the increased wages they will now have to pay. Establishments could also change their business models to reduce labor costs—such...
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