Bowser called for repealing Initiative 82 as part of her 2026 budget request, though it’s unlikely to pass the city council.
Washington, D.C.’s experiment with increasing the minimum wage for tipped workers proved so disastrous for the city’s restaurant industry and workers alike that Democratic Mayor Muriel Bowser is seeking its repeal.
Earlier this month, Bowser called for repealing D.C.’s Initiative 82 as part of her fiscal year 2026 budget request. Initiative 82 is a D.C. ballot measured passed in November 2022 that replaced the district’s tipped minimum wage of $5.35 with the minimum wage for non-tipped employees.
“DC restaurants are facing a perfect storm — from increased operating and supply costs to higher rents and unique labor challenges,” Bowser said in a statement. “DC must rebalance our system to ensure local restaurants can survive, compete, and employ DC residents.”
By 2027, Initiative 82 would have set the minimum wage for tipped employees at $15 an hour, following incremental increases in the years prior. The ballot measure was considered a success for left-wing activist organizations, including One Fair Wage, a progressive group that previously attempted to skirt tax laws on nonprofit lobbying. One Fair Wage supports minimum wage increases and has pushed similar initiatives in blue areas nationwide, with limited success thus far.
“Mayor Bowser is siding with industry lobbyists who have fought fair wages for decades, rather than respecting the twice-expressed will of voters who chose dignity, fairness, and economic justice,” One Fair Wage president Saru Jayaraman said.
A full repeal is unlikely to pass muster with D.C.’s Democratic city council, unlike 2018, when city council members and Mayor Bowser repealed Initiative 77, a similar measure.
“There’s no way for restauranteurs to absorb the higher costs other than passing them on to customers. And that’s always just basic economics 101,” said Sean Higgins, an economist at the free-market Competitive Enterprise Institute.
“Most of these restaurants operate on very thin margins. A lot of them are always teetering around closure even at the best of times. Forcing them to pay their workers more is just a problem for them,” he added.
D.C.’s restaurant industry trade group, the Restaurant Association Metropolitan Washington, thanked Bowser for her stance, citing the perilous times the industry is facing.
“Let us be clear — repealing Initiative 82 is about saving jobs, saving restaurants, and stabilizing a vital sector of the District’s economy. Restaurants are cornerstones of our communities,” the association said in a statement.
“Yet nearly 70% of them have already been forced to cut hours and lay off staff. In 2024 alone, the city saw a record 74 closures. The consequences of inaction are not hypothetical — they’re happening now.”
D.C.’s restaurant industry is facing a full-blown crisis, with multiple popular eateries citing I-82 as one of the reasons they closed down. A recent survey found that 44 percent of D.C. restaurants were “likely to close” by the end of the year, a stark finding reflective of the sour mood among restaurant owners in the nation’s capital.
A November 2023 survey conducted by the Restaurant Association Metropolitan Washington in the first year I-82 came into effect and found that 91 percent of restaurants were paying higher wages and 75 percent had experienced decreased profits compared to pre-Covid-19 times.
“We thank Mayor Bowser for proposing decisive steps to address the devastation tipped workers have faced from Initiative 82,” said Rebekah Paxton, research director at the Employment Policies Institute, a free market think tank.
“Advocates promised the law would bring higher wages with no impact on tips, but all D.C. tipped workers actually got were fewer tips, lost jobs, and closed restaurants.”
The Employment Policies Institute crafted a report detailing the economic fallout from I-82, estimating that D.C’s restaurant industry lost 1,000 jobs because of the ballot measure, based on Bureau of Labor Statistics data. The true number of job losses is likely higher because the report’s total does not include job turnover, shift reductions, or stalled hiring.
The 3.5 percent job loss the D.C. restaurant industry experienced after I-82 followed a 15.3 percent jobs increase from May 2022 to May 2023, though that increase was likely driven in part by the lifting of Covid-19 restrictions.
Furthermore, the Employment Policies Institute cited anecdotal evidence and economic research showing decreased restaurant tips in connection with increased minimum wages for tipped workers, leading to lower overall earnings.
Customers normally tip workers at their own discretion, with the average tip being around 15 to 20 percent of the overall bill. Left-wing activists believe a standard minimum wage for tipped workers makes them less dependent on customers’s generosity and ensures they will not be underpaid by greedy employers.
Unite Here Local 25, a D.C.-area hospitality workers union, supports I-82 and disputed statistics showing the D.C. area’s restaurant industry has battled economic headwinds over the past few years. The report cited D.C. statistics on liquor licenses and federal data on wages for D.C. food service workers.
Some Democratic areas have rejected attempts to impose an increased minimum wage for tipped workers, despite One Fair Wage’s best efforts. Massachusetts voters rejected a ballot question in November to raise the minimum wage for tipped workers to $15 an hour and Michigan Governor Gretchen Whitmer (D) signed bipartisan legislation earlier this year protecting the tip credit in her state.