Ending the Tipped Minimum Wage Will Reduce Poverty and Inequality
“The Raise the Wage Act, which was reintroduced in Congress on January 26, would gradually lift the federal minimum wage from $7.25 per hour—where it has been stuck since 2009—to $15 per hour by 2025 and index it to median wage growth thereafter.1 Importantly, the bill’s sponsors in Congress also recognize the need to eliminate the subminimum wage, which has allowed employers to pay a much smaller base rate to tipped employees, teenagers employed for 90 or fewer days, and disabled workers. The subminimum wage for disabled workers would phase out by 2025, while tipped and temporary teenage workers would see their minimum wages gradually rise until they are equal to the regular minimum wage by 2027.”