Coun­cil OKs min­i­mum wage boost

Los An­ge­les law­mak­ers leave many cru­cial de­tails un­re­solved in hik­ing pay to $15 by 2020.

Los Angeles Times - - FRONT PAGE - By Emily Alpert Reyes and David Zah­niser

A land­mark or­di­nance boost­ing the min­i­mum wage in Los An­ge­les won ap­proval Wed­nes­day from the City Coun­cil de­spite a va­ri­ety of un­re­solved is­sues about how the law would work.

The law, which would raise the min­i­mum wage to $15 an hour by 2020, af­fects hun­dreds of thou­sands of work­ers and makes Los An­ge­les the largest city in the coun­try to man­date higher pay for work­ers at the bot­tom of the in­come lad­der. Back­ers pre­dicted the ac­tion here could re­ver­ber­ate across the na­tion, ul­ti­mately aid­ing mil­lions of Amer­i­cans.

“The winds in this coun­try do blow from the west to the east,” Coun­cil Pres­i­dent Herb Wes­son said. “And cities through­out the United States will watch what we do, and they will do the same.”

But coun­cil mem­bers opted to de­fer, at least tem­po­rar­ily, some of the most di­vi­sive is­sues sur­round­ing the wage or­di­nance. Sev­eral amend­ments could be made be­fore the law takes ef­fect.

One lin­ger­ing, highly con­tentious ques­tion is whether union­ized com­pa­nies should be al­lowed to ne­go­ti­ate for a sub-min­i­mum wage with their em­ploy­ees. The Los An­ge­les County Fed­er­a­tion of La­bor sought to add that pro­vi­sion to the or­di­nance in the fi­nal days of the de­bate, say­ing that it would help avert le­gal chal­lenges and al­low union work­ers to trade pay in­creases for other ben­e­fits as they saw fit.

Busi­ness groups an­grily at­tacked it as a ploy to prod com­pa­nies to union­ize. Del­uged with crit­i­cism, coun­cil mem­bers agreed to study the pro­vi­sion fur­ther.

Law­mak­ers say that they also will de­cide on a pro­vi­sion sought by or­ga­nized la­bor that would in­crease the num­ber of paid sick days over what the state has re­quired.

Other sen­si­tive, pend­ing is­sues in­clude whether to loosen the min­i­mum wage re­quire­ment for pro­grams that train the dis­ad­van­taged and dis­af­fected for jobs. Another un­re­solved mat­ter is whether to re­strict restau­rants’ use of sur­charges to offset added la­bor costs.

Law­mak­ers are also ex­am­in­ing how the wage law would ap­ply to out-of-town

com­pa­nies whose work­ers ven­ture into Los An­ge­les. Sev­eral coun­cil mem­bers also asked for a report on whether to ex­empt small busi­nesses — those with up to 50 work­ers — when the value of em­ployee ben­e­fits meets or ex­ceeds the wage re­quire­ments.

Asked why they ap­proved the or­di­nance with so many is­sues in flux, coun­cil mem­bers said they wanted to give busi­nesses and work­ers time to plan for the new wage man­dates.

“There’s a tremen­dous sense of ur­gency on this be­cause peo­ple are liv­ing be­low the poverty line and they need to know what’s go­ing to be go­ing on in their lives,” said Coun­cil­man Mike Bonin.

The vote puts the city at the fore­front of a na­tional cam­paign to lift work­ers out of poverty.

It rep­re­sented a win for or­ga­nized la­bor and for Mayor Eric Garcetti, who helped kick­start the City Hall de­bate nine months ago with his own plan to raise wages.

“This vic­tory is a tes­ta­ment to the un­de­ni­able power of ev­ery­day peo­ple com­ing to­gether in full force against in­come in­equal­ity,” said Bob Schoonover, pres­i­dent of Ser­vice Em­ploy­ees In­ter­na­tional Union Lo­cal 721, one of the pro­po­nents of the wage in­crease.

But busi­ness lead­ers such as Stu­art Wald­man, pres­i­dent of the Val­ley In­dus­try and Com­merce Assn., said elected of­fi­cials are ig­nor­ing the more cru­cial need to at­tract com­pa­nies to the city that will in­crease the num­ber of high­pay­ing jobs. Wed­nes­day’s de­ci­sion is a sign, he ar­gued, that city lead­ers have ac­cepted the idea that the bulk of Los An­ge­les jobs go­ing for­ward will pay min­i­mum wage.

“They’re do­ing noth­ing to bring in good pay­ing jobs,” Wald­man said. “The city needs bet­ter and de­serves bet­ter than that.”

Un­cer­tainty re­mains over how the wage boost will af­fect the Los An­ge­les econ­omy. Three dif­fer­ent stud­ies, one sought by la­bor, one by the Los An­ge­les Area Cham­ber of Com­merce, and one by the city, drew sharply dif­fer­ent con­clu­sions about its eco­nomic ef­fects, rang­ing from the omi­nous to the op­ti­mistic.

La­bor and com­mu­nity ac­tivists in­sist that the higher wages will stim­u­late the lo­cal econ­omy. But lead­ing busi­ness groups warn that the new law could end up hurt­ing work­ers as em­ploy­ers cut jobs to sur­vive.

“To­day, you made the Amer­i­can dream for so many harder in Los An­ge­les,” Ruben Gon­za­lez of the Cham­ber of Com­merce told law­mak­ers.

Even some schol­ars who said the wage plan would have a pos­i­tive ef­fect cau­tioned that their pre­dic­tions hinge on eco­nomic fac­tors that could change.

“The high den­sity of lowwage jobs in Los An­ge­les means that the ben­e­fits of rais­ing the min­i­mum wage will be con­sid­er­able,” a UC Berke­ley re­search team stated. “It also means that the risks of un­in­tended ef­fects are greater, es­pe­cially at higher wage lev­els” that take ef­fect in later years.

Also un­clear is how many cities in Los An­ge­les County will fol­low suit.

Of­fi­cials in West Hol­ly­wood and Santa Mon­ica say they plan to pur­sue their own min­i­mum wage hikes. And the Los An­ge­les County Board of Su­per­vi­sors is set to con­sider its own set of in­creases for un­in­cor­po­rated ar­eas such as Al­tadena and East Los An­ge­les.

But in El Se­gundo, which bor­ders Los An­ge­les, two coun­cil mem­bers have pub­licly dis­missed the idea. In nearby Tor­rance, one of­fi­cial said there was no plan to fol­low Los An­ge­les’ lead.

“While I re­spect what Mayor Garcetti has been able to ac­com­plish, I re­ally be­lieve that min­i­mum wage is an is­sue that is bet­ter ad­dressed by the state,” said Mayor Pat Furey.

Sacra­mento law­mak­ers are weigh­ing leg­is­la­tion that would in­crease pay state- wide to $13 per hour by the mid­dle of 2017, a year ear­lier than an­tic­i­pated un­der the Los An­ge­les or­di­nance. And a health­care work­ers union is lead­ing a statewide bal­lot ef­fort to raise Cal­i­for­nia’s min­i­mum wage to $15 an hour by 2021.

Pas­sage of the Los An­ge­les wage hike “ab­so­lutely helps” the chances of that pro­posed bal­lot mea­sure, said Dave Re­gan, pres­i­dent of Ser­vice Em­ploy­ees In­ter- na­tional Union-United Health­care Work­ers West. “It demon­strates to peo­ple that this is an achiev­able goal.”

Ei­ther state mea­sure could ease fears that Los An­ge­les will lose busi­nesses to neigh­bor­ing cities with lower la­bor costs. Coun­cil­man Gil Cedillo said his wor­ries about po­ten­tial job losses sub­sided as a state min­i­mum wage in­crease gained mo­men­tum.

Be­cause the wage or­di­nance did not pass unan­i­mously — Coun­cil­man Mitch Eng­lan­der op­posed it — it re­quires a sec­ond, pro­ce­dural vote next week be­fore it can be sent to the mayor for his sig­na­ture.

Al Seib Los An­ge­les Times

IRENE GON­ZA­LEZ, cen­ter, joins sup­port­ers of the wage hike march­ing to City Hall on Wed­nes­day.

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