This week, polls opened for early voting in Washington, D.C. This season’s campaign has been contentious when it comes to Initiative 77, a ballot measure that would gradually phase out D.C.’s tipped minimum wage, currently $3.33 per hour, and replace it with a unified minimum wage by 2026. The National Restaurant Association has come out hard against it, and signs opposing the measure have appeared in high-end dining establishments across the city.
The trouble is, there isn’t much actual information beyond the signage—and the information being shared isn’t backed by research.
D.C.’s overall minimum wage is $12.50 per hour, and will increase to $15 by 2020. By law, employers have to ensure that tipped workers make that amount as well—by combining the base wage of $3.33 with their tips—and if workers’ wages are too low, employers are required to supplement them. In practice, employers often fail to do this. Research by the Economic Policy Institute found that recent Department of Labor investigations of close to 9,000 restaurants resulted in workers receiving nearly $5.5 million in back pay because of tipped wage violations.
Low wages have left many tipped workers struggling to make ends meet. Roughly 1 in 4 D.C. bartenders, servers, manicurists and pedicurists, and shampooers made $11.71 per hour or less in 2017*—well below a living wage in the district. D.C.’s tipped workers are also nearly twice as likely to live in poverty compared to the city’s overall workforce.
The concerns with the tipped wage go beyond just money—the power dynamics of the tipping system allow discrimination and inequality to flourish. One study showed that black servers receive tips that average 15 percent to 25 percent less than white servers, and in D.C., tipped female workers are twice as likely as tipped male workers to live in poverty. It also paves the way for sexual harassment: 1 in 7 sexual harassment charges filed with the Equal Employment Opportunity Commission are in the accommodation and food service industry.
While the evidence is clear on the positive impacts for D.C.’s lower-wage tipped workers, the District’s high-end restaurant and bar scene, with its higher-paid workforce, has been the center of attention during much of the debate, with figures ranging from Mayor Muriel Bowser to Chef José Andrés voicing concerns that the unified minimum wage will lead to higher prices and lower pay. In contrast, research shows that the eight states without a tipped minimum wage have higher average earnings and lower poverty rates among tipped workers, without hurting their employment rates. Specifically, in equal treatment states, tipped workers’ median earnings are 14 percent higher and the growth of restaurants and restaurant employment is more robust compared with states that use the federal minimum tipped wage of $2.13 per hour. Research also suggests that abolishing the tipped minimum wage may be particularly advantageous for women, as the average wage gap for women tipped workers in equal treatment states is one-third smaller than the wage gap for women tipped workers in states that maintain the federal tipped minimum wage.
It’s tough to envision that high-end establishments’ well-off clientele, wine-and-dine lobbyists, and company-credit-card-wielding business travelers will suddenly become highly price-sensitive if the cost of a meal rises slightly. And any increase would likely be relatively small: Labor costs only account for an average of 30 percent of restaurant operating costs, and businesses absorb higher minimum wages through reductions in costly turnover and increases in productivity. It’s also unlikely diners would compensate for higher prices by offering a smaller gratuity: data on tipping show that tipping behavior in equal treatment states is virtually indistinguishable from tipping behavior in states that have different minimum wages for tipped workers.
What’s more, this focus on D.C.’s high-end establishments misses the bigger picture. Not only is the district home to many restaurant workers who struggle to make ends meet—even after tips—but one-fifth of D.C.’s tipped workers aren’t in the restaurant industry at all. Many valets and manicurists, for example, don’t earn 20 percent on top of an expensive meal, but the Department of Labor allows their employers to pay them D.C.’s $3.33 per hour base wage as long as they “customarily and regularly” receive $30 or more per month in tips.
Initiative 77—which 70 percent of voters support—would reduce poverty and increase economic security among tipped workers in the district, as well as better protect them against discrimination, wage theft, and sexual harassment. The effects would be particularly powerful for women and people of color. Chipping in a little more for craft cocktails and small plates at happy hour seems like a small price to pay.
* Note: At the time these data were collected, the minimum wage in Washington, D.C. was $11.50 per hour.
Truthout Is Preparing to Meet Trump’s Agenda With Resistance at Every Turn
Dear Truthout Community,
If you feel rage, despondency, confusion and deep fear today, you are not alone. We’re feeling it too. We are heartsick. Facing down Trump’s fascist agenda, we are desperately worried about the most vulnerable people among us, including our loved ones and everyone in the Truthout community, and our minds are racing a million miles a minute to try to map out all that needs to be done.
We must give ourselves space to grieve and feel our fear, feel our rage, and keep in the forefront of our mind the stark truth that millions of real human lives are on the line. And simultaneously, we’ve got to get to work, take stock of our resources, and prepare to throw ourselves full force into the movement.
Journalism is a linchpin of that movement. Even as we are reeling, we’re summoning up all the energy we can to face down what’s coming, because we know that one of the sharpest weapons against fascism is publishing the truth.
There are many terrifying planks to the Trump agenda, and we plan to devote ourselves to reporting thoroughly on each one and, crucially, covering the movements resisting them. We also recognize that Trump is a dire threat to journalism itself, and that we must take this seriously from the outset.
After the election, the four of us sat down to have some hard but necessary conversations about Truthout under a Trump presidency. How would we defend our publication from an avalanche of far right lawsuits that seek to bankrupt us? How would we keep our reporters safe if they need to cover outbreaks of political violence, or if they are targeted by authorities? How will we urgently produce the practical analysis, tools and movement coverage that you need right now — breaking through our normal routines to meet a terrifying moment in ways that best serve you?
It will be a tough, scary four years to produce social justice-driven journalism. We need to deliver news, strategy, liberatory ideas, tools and movement-sparking solutions with a force that we never have had to before. And at the same time, we desperately need to protect our ability to do so.
We know this is such a painful moment and donations may understandably be the last thing on your mind. But we must ask for your support, which is needed in a new and urgent way.
We promise we will kick into an even higher gear to give you truthful news that cuts against the disinformation and vitriol and hate and violence. We promise to publish analyses that will serve the needs of the movements we all rely on to survive the next four years, and even build for the future. We promise to be responsive, to recognize you as members of our community with a vital stake and voice in this work.
Please dig deep if you can, but a donation of any amount will be a truly meaningful and tangible action in this cataclysmic historical moment.
We’re with you. Let’s do all we can to move forward together.
With love, rage, and solidarity,
Maya, Negin, Saima, and Ziggy