| Update Applicable to: | Effective Date |
| All Employers in DC | Immediate change (pause) October 1, 2025 – Tipped Minimum Wage Increase |
What happened?
On June 30, 2025, the District of Columbia enacted emergency legislation delaying a scheduled increase in the tipped minimum wage from $10 to $12 per hour.
Overview:
What Employers Need to Know
- The increase, originally set for July 1, 2025, is paused until at least October 1, 2025.
- Employers may continue to:
- Pay tipped employees a cash wage of $10/hour.
- Take a tip credit of $7.95/hour, reflecting the new standard minimum wage of $17.95/hour.
- This delay stems from:
- The Mayor’s proposed repeal of Initiative 82, which aims to eliminate the tip credit by 2027.
- Ongoing federal discussions on tip taxation.
- The emergency legislation (D.C. Act 26-94) is temporary and will expire on September 28, 2025, unless extended.
Employer Action Steps
- Maintain the $10/hour tipped wage and apply the updated $7.95/hour tip credit.
- Ensure total compensation (wages + tips) meets or exceeds $17.95/hour.
- Monitor local and federal developments that may impact wage requirements.
Source References
- DC Council – Press Release
- DC Council Resolution
- DC Act 26-94 – Tipped Minimum Wage Increase Clarification Emergency Amendment Act of 2025
Resources
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