May 08--A Los Angeles city councilman is floating a compromise plan on boosting the minimum wage, one that would move more gradually to increase hourly pay to $15.25 than other proposals being studied at City Hall.
Councilman Paul Krekorian has been circulating a plan that would offer some relief to small businesses and some nonprofit groups worried about how they would handle increased costs.
Krekorian said in a statement that in the face of growing wage inequality that has degraded the middle class, "we have an opportunity right now to lift many of our own hard-working residents out of poverty. We also need to ensure that our growing economy, led by small businesses, continues to expand and create new jobs."
"My proposal strikes that balance," Krekorian said.
Los Angeles City Council members are expected to vote in coming weeks on a plan from Mayor Eric Garcetti to move the minimum wage to $13.25 in 2017, up from the current state requirement of $9 per hour. A second proposal from council members would go further, taking the minimum wage to $15.25 by 2019.
But behind the scenes, Krekorian has been laying out a more gradual timeline, something sought by many business owners critical of the existing plans.
Under his proposal, businesses with 51 or more employees would need to pay a minimum wage of $13.50 starting in 2018, one year later than Garcetti's target for reaching $13.25. Those companies would need to pay at least $15.25 per hour in 2021, a deadline two years later than the one floated by council members last fall.
The Krekorian proposal would also allow employers with 50 workers or fewer to pay a minimum of $13 per hour by 2019 and $15.25 per hour by 2022.
Stuart Waldman, president of the Valley Industry and Commerce Assn., called the Krekorian plan "a step in the right direction." But Waldman said he was still worried that future increases in the required wage would be pegged to an inflation index.
Doing so is "a dangerous task that doesn't give anyone flexibility during tough times, including the city," Waldman argued.
Ruben Gonzalez, senior vice president of the Los Angeles Area Chamber of Commerce, said his group still had "significant concerns," but also called the Krekorian plan "a good start."
In reaction to the Krekorian plan, Councilman Mike Bonin said he continued to support getting to $15 in 2019 so workers got "a fair wage for a day's work." Councilman Curren Price said he had yet to review the new proposal, but said the need for higher wages was urgent.
"I don't want the citizens that I'm representing, folks working two or three jobs, to wait years and years.... My commitment is getting to $15 as soon as possible," Price said.
Gilda Valdez, chief of staff for Local 721 of the Service Employees International Union, issued a statement Friday saying that "any proposal to further delay a living wage of $15 an hour ignores all the studies on economic benefits to our local communities, and is tone deaf to the increasing poverty threatening L.A.'s working families."
The "abysmal reality" of workers fasting and going on strike to push for higher wages "means that our elected leaders must come together with no other goal than to figure out how to get to $15 as soon as possible," Valdez said.
Under the plan floated by Krekorian, teenage workers would only have to be paid the state minimum wage or 85% of the city minimum wage -- whichever was higher. Apprentices and people in transitional employment programs could also be paid at that lower rate.
And nonprofits that rely solely on state and federal grants or reimbursements to pay their workers would be exempted from the higher L.A. minimum wage entirely.
Krekorian's plan does not say whether there should be any adjustment in the wage rules for workers who get tips, but says that City Atty. Mike Feuer should report back on "a path forward" on that issue.
UPDATE
3:11 p.m.: This post has been updated with comments from Gilda Valdez, of SEIU Local 721.
This post was originally published at 1:42 p.m.
