D.C. Set for New $15 Minimum Wage

The “fight for fifteen” may have scored a knockout punch in the nation’s capital this week.

Key Takeaways:

• A new D.C. law raises the minimum wage for most workers to $15 per hour by 2020.
• Tipped employees will have a separate $5.00 per hour minimum wage.
• Starting in 2021, the minimum will increase automatically every year based on the Consumer Price Index.
• The new rate will be more than double the federal minimum, currently $7.25 per hour.

On June 7, the D.C. Council unanimously approved a new law that would increase the District’s minimum wage to $15 per hour by 2020. A second, largely procedural vote on the law is scheduled for June 14.

The law will gradually increase the District’s minimum wage every July starting next year. In a compromise with the restaurant industry, the council set much milder increases for tipped employees. For these workers, the new minimum wage will reach $5.00 per hour by 2020. The full schedule for the increases is:

After 2020, the District’s minimum wage will automatically increase every year to keep pace with the Consumer Price Index. The District’s current minimum wage stands at $10.50. Under a 2014 law, that number will increase to $11.50 on July 1, 2016—next month. 

Mayor Muriel Bowser, who urged the council to act on the minimum wage back in April, hailed the news and pledged that she would sign the measure. In a statement, Bowser said the increase would “put more money in the pockets of working families, and put more people on the pathway to the middle class.” The left-leaning Economic Policy Institute projected that the law would raise wages for 114,000 workers, or about 14 percent of all D.C. residents.

A January poll found that 70 percent of D.C. residents “definitely” supported increasing the minimum wage to $15 per hour. While support from the general public and labor unions has been strong, leading business groups have been unenthusiastic—at best—about an increase. 

Last month, Margaret Singleton, CEO of the D.C. Chamber of Commerce, urged councilmembers to wait for the District’s neighbors to act on the minimum wage first. Acting before then, she argued, could lead some businesses to leave the city and seek out cheaper labor in Maryland and Virginia. House Speaker Paul Ryan also opined that the increase would “do more harm than good” for the District.

Earlier this year, both New York and California passed measures raising their minimum wages to $15 per hour. The federal minimum wage, last raised in 2009, currently stands at $7.25 per hour.