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First D.C. Tip Credit Elimination Act Measures Soon to Become Effective

By Alyson J. Guyan on April 14, 2023
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Beginning May 1, 2023, the hourly minimum wage for tipped employees in the District of Columbia will increase from $5.35 to $6.00. This increase is the first step in the eventual elimination of the tip credit altogether in the District.

The next phase will occur on July 1, 2023, when the base hourly minimum wage for tipped employees will increase from $6.00 to $8.00. That increase will coincide with an increase in the District’s full hourly minimum wage, from $16.10 to $17.00, for all workers regardless of the size of the employer. If, averaged weekly, a tipped employee’s combination of tips and their base minimum wage do not equal the District’s full minimum wage, the employer must pay the difference.

During the November 2022 elections, the D.C. Council passed the Tip Credit Elimination Act. Under previous District law, employers of tipped workers were permitted to take a credit against tipped wages received by workers to satisfy the minimum wage guaranteed to all workers under the law. The Tip Credit Elimination Act gradually will reduce the tip credit until, in 2027, the tip credit is eliminated altogether and the base wage for tipped workers will match the District’s full minimum wage.

The first step in the reduction of the tip credit originally was scheduled to take effect on January 1, 2023, but was delayed due to the lengthy voting process to elect Representative Kevin McCarthy (R-Cal.) as speaker of the U.S. House of Representatives and its impact on the timeframe Congress is given to review approved D.C. voter initiatives or Council legislation.

If you have any questions about this development or any other wage and hour question, please contact the Jackson Lewis attorney(s) with whom you regularly work.

Photo of Alyson J. Guyan Alyson J. Guyan

Alyson J. Guyan is a principal in the Washington, D.C. Region office of Jackson Lewis P.C. She represents corporations and other entities in a wide variety of employment, discrimination, harassment, and wage and hour matters.

Aly advises and represents employers in a broad…

Alyson J. Guyan is a principal in the Washington, D.C. Region office of Jackson Lewis P.C. She represents corporations and other entities in a wide variety of employment, discrimination, harassment, and wage and hour matters.

Aly advises and represents employers in a broad range of employment law matters arising under federal and state law, including claims based on the Fair Labor Standards Act, Title VII of the Civil Rights Act, the Family and Medical Leave Act, and the Americans with Disabilities Act. She also works on administrative matters before the Equal Employment Opportunity Commission, as well as state agencies. As part of her counseling practice, Aly provides daily advice and training to management to help employers avoid litigation. She regularly advises employers on various employment-related issues, including hiring, performance management, leave, compensation, termination, employment contracts, personnel policies and handbooks.

Read more about Alyson J. GuyanEmail
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  • Posted in:
    Employment & Labor
  • Blog:
    Wage & Hour Law Update
  • Organization:
    Jackson Lewis P.C.

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