Chicago city councilors opposed to the elimination of the tip credit failed to muster enough votes on Wednesday to override Mayor Brandon Johnson’s veto of a March bill preserving a 24% tip credit, according to a recording of the council’s meeting. The veto override fell several votes shy of the two-thirds support required to reverse the mayor’s action.
Chicago’s stepwise elimination of the tip credit, which passed the council in 2023, will continue as a result of the failure of the veto override.
In his veto, Johnson cited the unpredictability of tips and the pressure of inflation on worker earnings. Johnson also said city data indicated Chicago’s foodservice sector was still growing: “adding a net 680 Food Retail Establishment licenses in 2024 and another 664 in 2025.” However, those numbers encompass all Food Retail Establishments, rather than the subset of licenses issued to restaurants taking a tip credit.
The tip credit issue is not settled, however. Several alders — Chicago’s term for members of its City Council — proposed an amendment delaying the elimination of the tip credit, according to the meeting recording. That amendment must work its way through the council’s committees before receiving a vote.
The National Restaurant Association said in a statement that the proposed amendment would pause increases in the tipped wage for two years.
“The tip wage is far from settled,” Mike Whatley, vice president of state affairs and grassroots advocacy at the association, said in a statement. He also thanked the council for “keeping the dialogue on the importance of the tip wage going.”
The Illinois Restaurant Association said in a press release that it was disappointed with the failure of the veto override, but noted that the override secured support from a majority of alders.
“We hope the mayor’s office acknowledges this widespread support, recognizes the significant concerns with the current plan, and commits to finding a solution,” said Sam Toia, president and CEO of the IRA.
