WASHINGTON (DC News Now)—This November, voters in the District could make changes to how tipped workers are paid.
Ballot initiative 82, or the District of Columbia Tax Credit Elimination Act of 2021, aims to gradually get rid of the tipped credit employers can take against their tipped staff.
Right now, tipped employees can be paid a minimum of $5.35, plus tips. However, under law their average hourly pay, including tips, must reach the minimum wage of $16.10. If not, the employer must make up the difference. If initiative 82 passes, tipped workers would make a base salary of $16.10, plus tips.
“In any other career pretty much, you get paid for showing up for work and doing your job and this the one job where if the weather is bad, if the restaurant gets a bad review, you might not get paid,” said Adam Eidinger, Treasurer of the DC Committee to Build a Better Restaurant Industry, which is pushing the initiative.
Eidinger said this would level the playing field for members of the restaurant industry .
“Customers want to make sure the workers are being paid a fair wage. Tips should be extra. The vast majority of tipped workers want this. There’s a small minority that doesn’t,” he said.
Bartender Valerie Torres, is against it.
“It would harm the workers that it’s supposed to be helping. It’s a very nuanced issue that can’t just be remedied by a blanket legislation that wouldn’t necessarily apply or be helpful to all establishments,” she said.
Torres fears a change in how tipped workers are paid will result in less money for workers because she believes restaurant owners will implement a service charge on each check to help cover the additional labor costs.
“There’s this misconception that if the establishment is applying a service charge that all that money will now go to the person waiting on your table, but once it’s a service charge it’s no longer gratuity. So now it’s revenue for the establishment,” she said.
“My servers make somewhere between $30 and $40 an hour. So, I sort of question those that advocate for initiative 82, why are you advocating for this group that doesn’t really want to be advocated for?” said Geoffrey Tracy, owner of Chef Geoff’s.
Tracy is against the ballot initiative. And agreed that consumers will be left footing the bill for it.
“Everyone realizes you’ll have to come up with some sort of way of passing the expense onto the customer,” he said.
And, he believes it could also result in a loss of jobs.
“If I have to increase my wages $10 an hour for every full-time tipped employee that’s an additional over $20,000. So, if I have 25 full time people that’s a $500,000 expense. You can look at my profit and law statement, I can’t absorb $500,000,” he explained.
“I actually think the restaurants are crying wolf when they say they won’t be able to survive,” said Eidinger. “This has been done in seven states, and there was no collapse of the restaurant industry.”
Supporters of the change do not believe restaurant owners need to implement a service charge to cover the costs. And if costs do need to increase, Edinger does not believe it’ll be noticeable for customers.
“A business isn’t just a labor. It’s the cost of food, it’s the cost of rent. Those things are always going up but, for some reason the wages aren’t going up. We have to make them go up,” he said. “The typical restaurant goer will need to pay about $1 for these workers to get a fair wage. No one is going to notice it.”