District of Columbia Imposes Important Restrictions on the Hospitality Business

The District of Columbia Council has passed several laws that place significant obligations on employers in DC, especially those in the hospitality industry. The following are summaries of the most recent laws passed in the district and the key obligations under each law.

Changes to the Act to Change the Fairness of Tipped Wage Workers

In 2018, the District of Columbia passed the Employee Fairness Modification Act (the Act) with the primary aim of repealing Initiative 77, a referendum aimed at removing the availability of “tip credit” in the district. While maintaining the use of the tip credit in the district, the law also imposes significant obligations on employers who employ tipped employees, e.g. For example, using an outside payroll service to process payroll and drawing up pay slips that list the tips received from employees. The law also imposes significant training and reporting obligations on all employers of tipped employees, although implementation of these obligations has been delayed as they have been subject to budget approval. However, effective December 3, 2020, the District of Columbia has amended portions of the Act with immediate effect (the “Amended Act”) and immediately put these mandatory training and secondment requirements into effect.

Mandatory training and reporting

The amended law mandates sexual harassment training for all tipped employees and for all managers and owners or operators of companies who tipped employees. The Department of Employment Services (DOES) must offer an approved sexual harassment training course or otherwise certify a list of providers who can offer such training. Once the DOES takes action, employers must conduct training according to the following schedule:

  • Current employees must receive in-person or online training within two years of the training being approved by DOES.
  • New employees must receive in-person or online training within 90 days of being hired (unless they have attended approved training in the past two years).
  • All managers are required to undergo in-person training at least every two years.

Employers must also have sexual harassment prevention policies in place, with clear procedures for reporting incidents. Employers must provide copies of these guidelines to DOES, although the deadline for compliance is not currently known. In addition, employers of employees with tips must offer annual mandatory training on the revision of the 1992 Minimum Wage Act and certify to the DOES that the training requirements have been met.

General booking requirements

These changes now require the mayor to create a website by April 2, 2021 informing workers about certain employment rights under 10 different labor laws, such as: B. on the right to punctual payment and at least the minimum wage. get a detailed payroll; Right to unpaid family and sick leave; be compensated for work-related illness or injury; and to remain free from discrimination and retaliation by the employer. Also by April 2, 2021, the mayor must provide employers with a universal poster of these rights, which must be displayed “in a place accessible to all workers”, including in all break rooms and at all time clocks in the workplace.

Employers viewing the executive summary poster are also not required to meet the individual posting requirements of: (1) the Living Wage Act, (2) the DC Human Rights Act, (3) the DC Family and Medical Leave Act, (4) parental leave Act, (5) the Act on Accumulated Sick People and Safe Holidays, (6) the Act to Revise the Minimum Wage Act, (7) the Act on the Minimum Working Week for Building Technology Employees, (8) the Act to Protect the Fairness of Pregnant Employees and ( 9) the DC Employee Compensation Act.

Employers need to have all the information provided on the new website “from a single source, e.g. B. a “folder” and attach a copy to each place where the required poster is displayed. Employers are responsible for updating this folder at least monthly. Employers can be fined $ 100 per day for the period they fail to meet these requirements.

Public awareness campaign

The changes also concern the formation of a coordination council for employees who have been overturned (Council), which includes employees, employers and representatives of public bodies. The main responsibility of the council will be to improve wage policy coordination, investigate wage theft involving tipped staff, and conduct regular and anonymous case reviews of wage infringement claims.

Quarterly Payroll Report Requirements for Tipped Employees

The District of Columbia Council also changed the Minimum Wage Revision Act to require tip employers to provide the mayor with a quarterly wage report for the previous calendar quarter no later than 30 days after the end of each calendar quarter. This report must certify that each individual salary has received at least the minimum wage required and must also include the following information:

  • Name of each employee; average hourly wage per week during the quarter, total working hours at or above the minimum hourly wage; Gross wage per week; and total tips received per week; and
  • A copy of the employer’s tipping policy that was used during the quarter, or a certificate that such a policy was in place and that the employer is providing this information separately to the mayor.

For non-hotel employers, an external payroll clerk must provide information. Hotel employers can submit payroll reports themselves along with a certificate of accuracy. Employers who agree to file the Tip Pooling Policy directly must do so within 30 days of the end of the calendar quarter. Otherwise, it is assumed that such a policy did not exist for the quarter in question.

Reinstatement of displaced persons

The DC Council passed the Displaced Workers Act, which requires certain retail and hospitality employers to reinstate workers whose jobs were eliminated during the COVID-19 health emergency. before offering other applicants other vacancies.


The legislation applies to owners of restaurants, taverns, brewpubs, nightclubs, clubs, entertainment venues and retail stores that employed 50 or more people as of March 1, 2020, and hotels that employed 50 or more people as of December 1, 2019 were. It also includes contractors who employ 25 or more people and have hired individuals to work as:

  • Food service workers in a hotel, restaurant, cafeteria, apartment building, hospital, facility, or similar facility;
  • Janitorial or building maintenance personnel in an office building, facility or similar facility;
  • non-professional employees who provide healthcare or related services in a hospital, care facility, or similar facility; or
  • Individuals who provide security services in an office building or facility or similar facility.

An “authorized employee” is a person who was employed in a covered operation or for a contractor and who has ceased work in the covered operation or for the contractor for reasons other than voluntary resignation or termination for good cause

Notification requirements

If the mayor approves the law on displaced persons with effect from February 1, 2021, as soon as positions become available in the contractor’s or employer’s company, any insured employer or contractor who wishes to fill a vacancy must first offer the position to employees who are during the State of health discharged were emergency. This reinstatement offer applies to all workers laid off from a Covered Hotel between December 1, 2019 and March 1, 2020 for other insured employers, as well as for the last day of public health emergency designated by the Mayor as Response to the COVID-19 pandemic (currently scheduled for March 31, 2021). Offers do not have to be made to:

  • Salaried exempt employees;
  • Employees who received severance payments in connection with their dismissal; or
  • Employees whose employment was terminated for “demonstrably just cause”.

Offers must be extended to former employees when filling: (1) the employee’s previous position; or (2) a position that performs substantially the same duties and requires substantially the same skills as the previous position. The offer must be made in writing with a period of at least three calendar days for acceptance or rejection. After acceptance, the employee can be asked to report within seven days, unless the employer requests a later deadline. Offers can be submitted on the basis of fixed seniority lists, or conditional offers can be extended to all eligible employees.

Change of control

With limited exceptions, in the event of an expected change of ownership within 15 days of the transaction, the following must be notified: (1) All retained and entitled employees that the employer is experiencing or anticipating a change in control or the employer’s identity as an employer and an employee’s right to Reinstatement or retention; (2) applicable unions; and (3) all interested parties. The new owner cannot dismiss a reinstated or retained employee for no reason within the first 90 days. At the end of the 90-day transition period, the new employer must conduct written performance reviews for each retained employee and, if performance is deemed satisfactory, offer the employee continued employment on the terms set by the new employer.


Employees can assert individual or class claims for possible violations and demand reimbursement, alleged damages up to three times the amount collected and the legal fees.

Next Steps

Despite strong opposition from the industry, the DC Council passed the Displaced Workers Act on December 15, 2020, pending signature by the mayor. Once approved, it is subject to the mandatory congressional review period. The DC Council is also expected to adopt an emergency measure that will incorporate much of the same provisions that will take effect immediately after the mayor’s approval.

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