Yes On 77 In D.C.

If you walk around D.C., you might have seen (likely you have) restaurants displaying “No on 77” signs. This is referring to Referendum 77 in D.C., to be held on June 19, which would raise the minimum wage for tipped workers to the ‘regular’ minimum wage by 2026 (in D.C., by 2020, the minimum wage will be $15/hour); currently the tipped minimum wage. Jared Bernstein and Ben Spielberg explain why Yes on 77 is a good idea (boldface mine):

In 2016, D.C. lawmakers set in motion a gradual increase to the city’s minimum wage to $15 by 2020. Because of pressure from the U.S. Chamber of Commerce and restaurant industry, however, the city’s tipped workers — food-service workers, hairstylists, hotel workers, taxi drivers and other employees for whom tipping is customary — got a substantially smaller increase. Their minimum wage, which is $3.33, will rise to only $5 an hour by 2020. Initiative 77 would, over the next eight years, phase out this subminimum wage for tipped workers such that by 2026, the city’s minimum wage for tipped workers would match the city’s regular minimum wage.

Under the law, tipped employees are still supposed to receive the minimum wage. If there’s a slow week at the hair salon and a hairstylist’s base pay plus tips works out to lower than the minimum wage, the salon is supposed to make up the difference. The problem is that the law is hard to enforce. Too often, workers in tipped industries who do not receive the added pay from their employers are unable to fight back because of fears of retaliation.

Related: EPI brings the wonk.

As the U.S. Labor Department’s former chief economist Heidi Shierholz has noted, 4 out of every 5 full-service restaurants the department investigated between 2009 and 2015 were violating wage and hour laws, with one of the most common violations being the failure to adequately compensate tipped workers. Tipped workers are significantly more likely than untipped workers to report that their hourly wages, including tips, are below the minimum wage.

And WE HAZ DATA!

As with minimum wage increases in general, the best way to gauge the impact of this policy is to see what’s happened in places that have implemented it. Eight states have already abolished the subminimum wage for tipped workers: Alaska, California, Hawaii, Minnesota, Montana, Nevada, Oregon and Washington. Several cities have, too. The results are that poverty has come down, pay has gone up, and employment remains stable.

For untipped workers, poverty rates are comparable across states whether they maintain a subminimum wage for tipped workers (see figure). But poverty rates for waiters and bartenders are substantially lower in the eight states that have one fair wage for everyone than in other states. Restaurant workers in these eight states also make about 20 percent more than their counterparts in states where the tipped minimum wage is $2.13 an hour (the federal tipped wage floor).

Being a notorious Dirty Fucking Hippie, I support Yes on 77. While this very well could hit waiters at high-end who can make good money off of tips (though I doubt it), I remember when, after Sept. 11, 2001, no one was eating out in D.C. (I just happened to be there shortly after the attacks for vacation), and even the high end servers were having a hard time making ends meet; I can’t even imagine what happened at the downscale restaurants. A living minimum wage can avert catastrophe.

Also, there are a lot of upper-middle class and gentry class people who live very well, in part because their ‘servant’ class does not, on the whole, get paid very well–or more honestly, they get paid shit. That’s wrong. Intelligent Designer forbid, you might have to pay more for dinner out.

If many of us, to have a good time, have to pay people a non-living wage to do so, then it’s time to change that.

This entry was posted in DC, Economics. Bookmark the permalink.

5 Responses to Yes On 77 In D.C.

  1. gchaffin4278 says:

    Heck Yea! I really am surprised so many DC leaders are against this.

    On Tue, Jun 5, 2018 at 10:01 AM Mike the Mad Biologist wrote:

    > mikethemadbiologist posted: “If you walk around D.C., you might have seen > (likely you have) restaurants displaying “No on 77″ signs. This is > referring to Referendum 77 in D.C., to be held on June 19, which would > raise the minimum wage for tipped workers to the ‘regular’ minimum wage” >

  2. JDM says:

    When I lived near DC in the 70s, I had a friend who worked as a waiter, as did his girlfriend. His girlfriend worked at a high end fine dining place; the friend worked at an all you can eat seafood place frequented by families. He made far more money than she did, not just due to table turnover, but due to vastly larger tips as a percentage of the bill.

  3. Bern says:

    Interesting. The waiters I talk to fear vastly reduced tips will counterbalance the wage increase, not to mention the chance that their hours/benefits will be cut…

  4. zero says:

    American tipping is a disgusting power game. Subminimums should be abolished everywhere. Every job should pay a decent wage, and tips should be optional for excellent service.

  5. kaleberg says:

    In Seattle, where the minimum wage has been rising, the trend is towards a fixed service fee. I’ve seen it at more and more restaurants. Even restaurants that have traditional tipping often add a service charge for parties of six or more. A lot of this isn’t about the tipped workers as much as the kitchen staff. Imposing a service charge means the wait staff gets at least minimum wage as does the kitchen staff, but the service charge goes to both the wait staff and the kitchen staff, something not allowed for tips.
    Right now, new restaurants are opening at an impressive rate in Seattle. We haven’t been able to keep up. We’re sure that a shakedown is coming. Not every newcomer will survive. Still, the higher minimum wage doesn’t seem to have hurt the business, nor has the new service charge policy.

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