EPI Warns R.I. House: Tip Credit Elimination Will Turn Rhode Island into D.C. Disaster

Ending the Tip Credit Would Slash Over $10 Million in Tipped Worker Earnings
  • Publication Date: March 2024

On Wednesday, the Rhode Island House Labor Committee will hear public testimony on House Bill 7531, which would eliminate the state’s tip credit and more than triple the current required hourly wage for tipped employees.

Rebekah Paxton, research director for the Employment Policies Institute (EPI), submitted written testimony ahead of the hearing, highlighting the adverse impacts this policy would have on Rhode Island’s servers, bartenders, and restaurants. Her testimony (available here) will include:

  • Insights from economic studies on the harmful track record of these policies across the country.

Ahead of the hearing, Paxton issued the following statement:

“Proposals like this have been opposed by actual tipped restaurant employees across the country for years, including last year in Rhode Island when the Labor Committee tabled a similar bill.  Decades of economic evidence show that tip credit elimination kills jobs, reduces employees’ take-home pay, and shutters restaurants. The legislature should avoid bringing the D.C. restaurant disaster to Rhode Island.”

*** The hearing will begin at 4:00 pm on Wednesday, March 27 in the State House Room 101. A livestream can be viewed here.***


Economists and employees alike reject this policy as a way to help tipped restaurant employees. Research indicates that eliminating tip credits causes earnings and job losses for restaurant employees, and forces businesses to shut down. Substantial research finds: