On Tuesday, June 7, 2016, the District of Columbia Council voted unanimously to raise the District’s minimum wage for both tipped and non-tipped employees.

For non-tipped employees, the current minimum wage in the District is $10.50 per hour and is scheduled to increase to $11.50 on July 1, 2016. Under the ordinance, titled "The Fair Shot Minimum Wage Amendment Act of 2016," the minimum wage rate will gradually increase each year until it reaches $15 per hour in 2020. Moreover, in a compromise measure reached in response to the hospitality industry's strenuous objections to a proposed higher wage hike, the minimum wage for tipped employees will increase from $2.77 to $5.00 per hour over the same period. After 2020, the minimum wage rate will be subject to automatic annual updates based upon the Consumer Price Index.

Although the ordinance has yet to be signed by Mayor Muriel Bowser, she has pledged her support and is expected to sign the bill. Once signed, the measure will undergo a mandatory review by the U.S. Congress under the D.C. Home Rule Act before it becomes District law.

Unless amended or vetoed by Congress, the District will join several other cities, including San Francisco, Seattle, and Los Angeles, in implementing phased minimum hourly wage increases that will eventually reach $15 per hour. States such as New York and California have likewise passed similar $15 per hour minimum wage legislation in this growing nationwide trend.

Employers with employees in D.C. are advised to plan accordingly. Employers can start preparations now by:

  • Verifying that employees working at current minimum wage rates will receive increases when they are required;
  • Calculating any corresponding overtime pay rates based on the revised hourly minimum wage rate;
  • Ensuring that Wage Theft Act Notices are timely distributed to employees;
  • Reviewing staffing levels and automation options; and
  • Updating computer software used to implement and calculate new minimum wage rates.