Los Angeles lawmakers could vote as soon as Wednesday to boost the minimum wage for workers at big hotels to $15.37 -- well above the minimum that Mayor Eric Garcetti is championing for workers citywide.
Labor groups have rallied behind the plan to ramp up the minimum wage for hotel workers, saying it could pull families out of poverty and inject more spending into the local economy. Several council members have championed the idea, including Councilman Curren Price, who said Los Angeles would set the example for the nation as “a progressive leader.”
Critics from business groups counter that hotels could be forced to cut jobs if the plan passes. They argue that it makes little sense to single out the hotel industry for higher wages, especially after the mayor unveiled a separate plan to increase wages citywide.
Garcetti recently announced his push to gradually hike the minimum wage for all Los Angeles workers to $13.25 by 2017, with future increases tied to an inflation index. The Hotel Assn. of Los Angeles says many of its members could back that plan -- but not the proposed hike for hotels.
“It is patently unfair for a dishwasher at a hotel restaurant to have a mandated minimum wage that is higher than a dishwasher at a restaurant across the street,” the association’s executive director, Bob Amano, wrote in a letter to Garcetti. “It does not make economic sense.”
But backers contend that the large hotels targeted by the wage proposal have fared much better than other sectors of the Los Angeles economy, making the industry unique.
“It’s done incredibly well -- in part because of the natural advantages of the city and Southern California,” said James Elmendorf, deputy director of the Los Angeles Alliance for a New Economy, an advocacy group focused on labor and environmental issues. “It’s also benefited from significant subsidies the city has provided.”
Thousands of L.A. hotel workers earn less than $15.37 an hour, with wages averaging around $9 for housekeepers, $11 for clerks and $12 for bellhops, according to an Economic Roundtable report underwritten by the alliance last year.
Earlier this year, a panel of Los Angeles lawmakers asked city staffers to start drafting an ordinance to hike wages at large hotels across the city. The decision came after a report commissioned by the city concluded that the wage boost would be “an inherent trade-off” -- but provided little clarity on how it might ultimately affect the economy.
Before the council pressed ahead to increase hotel wages, however, its president sought three economists to report back on how lower wages in the hotel industry are affecting the Los Angeles economy, among other questions.
Critics of the hotel wage plan had argued that such reports were mandated by the ordinance that years ago hiked wages at hotels near LAX. That earlier ordinance imposed requirements before the city could add new “living wage” rules – a set of hurdles meant to address concerns that the LAX-area ordinance would trigger more such regulations.
A council committee is expected to discuss those reports Tuesday, and the full council could vote as soon as Wednesday on whether to push forward and boost wages at large hotels.
Opponents of the plan say lawmakers are rushing the process. Lynn Mohrfeld, president and chief executive of the California Hotel and Lodging Assn., argued that the city had still failed to meet all the requirements before hiking wages. Central City Assn. chief executive Carol Schatz complained there was scant time for lawmakers and the public to review the reports drafted by economists, two of which weren’t publicly posted on the council website as of Friday afternoon. City officials say the reports are due Monday.
“The city has shown a complete disregard for a fair process,” Schatz said.
Elmendorf countered that months had passed since the plan was proposed, giving lawmakers, business groups and the public plenty of time to consider the idea.
“At every stage of this, opponents say, ‘“We need more time,’” he said.
If Los Angeles lawmakers approve the wage boost, it would go into effect next July for hotels with at least 300 rooms, and take effect a year later for smaller hotels with at least 125 rooms.
Unionized hotels could be exempt: The proposed ordinance includes a clause allowing the rules to be waived. It also includes a yearlong “hardship waiver” for hotels that face severe financial challenges paying the increased wages.
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