HR Management & Compliance

Washington, D.C., employers to face $15 minimum wage

The “Fight for $15” movement got a boost on June 7 when the Washington, D.C., City Council approved a minimum wage increase that will have the city’s lowest-wage workers earning $15 an hour by 2020.

The council unanimously approved the measure after council committee discussions worked out differences related to raising the city’s tipped minimum wage. Another council vote is required before the measure can be enacted, but that vote is seen as a formality. Mayor Muriel E. Bowser has said she will sign the measure.

The city’s current minimum wage is $10.50 an hour and was already scheduled to go to $11.50 in July. Under the new measure, the minimum wage will increase by about 70 cents per year until it hits $15 in 2020. After that, annual increases will be tied to inflation.

Under the measure, the city’s tipped minimum wage will rise from $2.77 to $5 an hour. Workers who hold jobs in which they receive tips may be paid the lower rate, but if their tips don’t bring their pay up to the regular minimum wage, employers must make up the difference.

Although the measure to raise the minimum wage has been cheered by labor unions working for higher wages across the country, it has sparked criticism among conservative groups. For example, the Cato Institute, a conservative think tank, posted an entry on its blog predicting the increase will hurt many workers.

“Supporters of the new bill may say that they want to ensure that hard work is rewarded and that people can support their families, but D.C.’s substantial minimum wage increases will make it much harder for many people, especially younger workers and people with limited job skills, to find any work at all,” the blog post says.

Wisconsin Republican Paul Ryan, speaker of the U.S. House of Representatives, also spoke out against the increase. He was quoted in The Washington Post as saying the increase will “actually do more harm than good in so many instances, because what it does is it prices entry-level jobs away from people.”

But Mayor Bowser says the measure will help low-income workers. “When I see how much it costs to live in Washington, D.C.—and that cost is only going up—we know that it takes more money for every household to be able to afford to live,” she was quoted as saying in The Washington Post. “There are families working day in and day out, sometimes two or three jobs, but barely making ends meet.”

Before the council’s vote, advocates of a higher minimum wage were pushing for a ballot initiative in November to increase the minimum wage to $15 for all workers, including tipped employees.

A report released by the Economic Policy Institute in May praised the proposed ballot initiative, calling it “a powerful and much-needed step to help ensure workers in the Washington area can achieve a decent quality of life.” The report also praised a proposal to phase out the tipped minimum wage, calling the subminimum wage “a system that exacerbates poverty and amplifies gender and racial inequities.”