Los Angeles’ plan for a citywide $15 minimum wage hit a last-minute snag when the organized labor groups that had been pushing for it demanded an exception for unionized businesses. That is, they want unionized workers to be able to be paid less than the new minimum.
The call has provoked anger from other supporters of the higher wage and charges of hypocrisy from business groups and their allies who have opposed the increase.
Rusty Hicks, executive secretary of the Los Angeles County AFL-CIO, nevertheless said Wednesday that unionized companies need to be excepted from paying the new minimum wage. He argued that mandating that all workers get paid $15 an hour would hurt the collective bargaining process.
“With a collective bargaining agreement, a business owner and the employees negotiate an agreement that works for them both. The agreement allows each party to prioritize what is important to them. This provision gives the parties the option, the freedom, to negotiate that agreement. And that is a good thing,” Hicks told the Los Angeles Times.
Hicks is also a leader of L.A. Raise The Wage, a coalition group that has pushed for the increase over the past eight months. On its website, the coalition calls for “$15.25/hr for every full time worker,” as well as “strong enforcement that holds all employers accountable to the law.” The language on the web page does not include an exception for unionized businesses. It had previously opposed loopholes in the new ordinance for small businesses.
Unions argue they need to have the flexibility during collective bargaining. In theory, the workers are trading it away for something else, such as better benefits. Neither the L.A. AFL-CIO nor L.A. Raise the Wage responded to a request for comment.
The calls came at the eleventh hour. The City Council voted last week to raise the wage and Mayor Eric Garcetti has said he supports it. But it might not be too late. On Thursday, he told reporters he was open to revisiting the proposal.
“I think a lot of people have opinions, whether it’s business or labor, or stakeholders. We’ll always listen to that,” the mayor told reporters.
Business leaders said the call for the exception exposed the hypocrisy behind the whole effort. “What we are seeing is that the whole Fight for $15 movement is not about raising wages. It is about pressuring businesses to unionize,” said Glenn Spencer, vice president of the Workforce Freedom Initiative, a Chamber of Commerce-backed group.
The exception, he notes, gives businesses a huge incentive to unionize their workers, since if they strike a deal with union leaders they can avoid paying the new minimum and thus avoid higher labor costs. The workers could find themselves not only not getting paid the new minimum but also having to pay the union representation fees.
Spencer notes that last year, the L.A. council boosted the minimum wage for large hotels to $15.37 an hour, but included an exception for unionized ones. That exception was championed by Unite Here, which represents workers in the hospitality industry.
“This $15 citywide [rule] completely undercuts that. The hotels would have no incentive to unionize anymore if everybody has to pay $15 an hour regardless,” Spencer said, adding it was “odd” that the unions let the city proposal get this far without including the exception.
San Francisco and SeaTac., Washington — two other cities that recently raised their minimum wages to $15 — also included carve-outs for unionized businesses. Similar waivers were included in recent minimum wage increases in Long Beach, San Jose, Richmond and Oakland, Calif., as well as Milwaukee County, Wis. In each case, the minimum wage push was largely backed by organized labor acting through grassroots groups and liberal coalitions.
