Council raises minimum wage despite outcry from business owners

West Hollywood’s minimum wage rate will soon be the highest in the United States.

City Council on Wednesday unanimously passed the increases, which will eventually raise the minimum wage to $17.64 per hour for all workers within the city limits.

The vote marks the end of a monthslong struggle between the city’s business community and its city councilmembers, who have largely thrown their open support behind labor causes such as the minimum wage increase and the hotel worker ordinance.

Business owners came out in droves during public comment to beg City Council to hit the brakes on the rate increase, pleading for more time and more input.

“Honestly, we’re not lying to you,” said Carey Mosier, owner of Gracias Madre. “This is an unsustainable wage. This wage is only going to the top earners. It’s going to increase our worker’s comp and payroll taxes. All the costs of running a restaurant are up.”

Brett Laterri, owner of the Den, estimates a $200,00 direct expense to his business as a result of the increase.

“Most businesses aren’t even aware this is going on,” said Lee Maen, owner of BOA Steakhouse. “They’re going to be slapped in the face. This is an absolute business and job killer. Why would someone open a business here when labor is 30 percent higher?”

“We’re going to stifle entrepreneurship and innovation,” said David Anawalt of Anawalt Lumber, one of WeHo’s oldest family owned businesses.

But City Council was resolute, and the ordinance was passed.

The minimum wage rate will be raised in phases depending on the size of the business.

For employers with 50 or more employees, the rate will rise to:

  • $15.50/hr. on Jan. 1, 2022
  • $16.50/hr. on July 1, 2022
  • $17.50/hr. on Jan 1, 2023
  • $17.64/hr. on July 1, 2023 
  • 96 hours of compensated leave time for sickness, vacation, or personal necessity, and an additional 80 hours of uncompensated sick leave

Employers with fewer than 50 employees, the rate will rise to:

  • $15/hr. on Jan. 1, 2022
  • $16/hr. on July 1, 2022
  • $17/hr. on Jan 1, 2023
  • $17.64/hr. on July 1, 2023
  • 96 hours of compensated leave time for sickness, vacation, or personal necessity, and an additional 80 hours of uncompensated sick leave

The City of West Hollywood released this detailed document regarding this new ordinance on Thursday:

The City Council of the City of West Hollywood has unanimously approved a draft Ordinance to establish a citywide minimum wage and guaranteed leave provisions. The draft Ordinance will create a hotel worker minimum wage of $17.64 per hour starting on January 1, 2022, and will create a phased approach for minimum wage increases for large businesses and small businesses starting on January 1, 2022 with adjustments every six months to create consistency in the minimum wage citywide by July 1, 2023. Starting on July 1, 2023, the citywide minimum wage for all businesses will be $17.64 (plus two cost of living adjustments as part of the phased schedule for increases). Following that, the citywide minimum wage for all businesses will be increased each July 1 by the Annual Consumer Price Index (CPI-W) Adjustment. The City Council approved a revised version of the draft Ordinance at its Adjourned City Council Meeting, which took place on Wednesday, November 3, 2021, via teleconference.

The approved draft Ordinance must return to the City Council for second reading to be enacted; this in anticipated to take place on November 15, 2021.

Video links to Council meetings are posted at www.weho.org/wehotv and at www.youtube.com/wehotv. Current and past City Council meeting agendas are available at www.weho.org/councilagendas.

“The minimum wage discussion can be a challenging one,” said City of West Hollywood Mayor Lauren Meister. “I want to ensure that all voices are heard in this discussion and that workers in our city are provided a wage that they can live on, that our businesses can recover in a post-COVID economy, and that our residents on limited incomes are able to afford goods and services in our city. I believe the approach we’ve crafted to phase implementation of the citywide minimum wage over time moves us forward and meets all three of these goals.”

“As we recover from the pandemic, it is important to ensure recovery includes everyone,” said Mayor Pro Tempore Sepi Shyne. “There is undeniable income inequality in this nation and wages have remained stagnant compared to the growing cost of living. This has caused workers to remain in poverty no matter how hard they work. I am proud of our unanimous decision last night to raise the minimum wage for workers to one of the highest levels in the country and include sick leave and personal time off provisions for all. West Hollywood has now proclaimed that we want our workers to be as successful as our businesses. We took into account the needs of working people as well as the requests from businesses to phase in the higher wage. West Hollywood has always been a creative leader on many fronts and now we are a leader in creating equity for workers and helping to close the gap in income inequality.”

“Raising the minimum wage to the highest in the country is us using our small shoe, our 1.9 square-mile shoe, that we know leaves an enormous footprint,” said Councilmember John D’Amico. “We can change the world and I have a sense we are starting something much bigger for workers across the country.”

“As someone who has worked a minimum wage job, I understand the challenges of being able to cover the growing costs of basic expenses such as rent and food without even taking into effect the massive number of other bills people now face due to the substantial pay gap in our country,” said Councilmember John M. Erickson. “Together, as a City Council, we unanimously put the needs of working people — and of the unique businesses that make our city great — on the table. We began this conversation 10 months ago and we focused on how we, as a city, can lead the way in helping people earn more, while also prioritizing paid sick time and other important provisions critical to uplifting the health of our community, overall.”

“West Hollywood has raised the wage and is, once again, leading the national conversation,” said Councilmember Lindsey P. Horvath. “Cost of living is rising everywhere — it’s getting more and more expensive to live, work, and raise a family. Our minimum wage should reflect that reality and I am proud to be part of this thoughtful step for our City. The wealth generated by an increased minimum wage will raise more people into the middle class, drive more consumer spending, and create a more stable, prosperous, and business-friendly economy. This victory belongs to the courageous people who came forward to say we can and must do better. I am ever-grateful for the workers who commit themselves every day to making our City such a special place.”

As background, the City Council held a special study session on Tuesday, August 31, 2021, to discuss potential changes to the City’s minimum wage, following Council direction to staff in February 2021 to review the minimum wage in West Hollywood and how the minimum wage relates to the living wage. During the study session, the City Council directed staff to draft an Ordinance establishing a citywide minimum wage and hotel worker minimum wage. The City Council’s direction included the following items:

1) Establish a citywide minimum wage for small and large businesses;

2) Establish a citywide hotel worker minimum wage;

3) Include sick leave provisions in the citywide minimum wage;

4) Include provisions for transitional job programs, learners’ programs, non-profits, collective bargaining exemption, and service charges.

The City Council, on October 18, 2021, reviewed a draft Ordinance prepared by City staff and provided additional direction for staff to return with a revision of the draft Ordinance.

During its Adjourned City Council Meeting on Wednesday, November 3, 2021, the City Council received this revision and then took steps to refine it with a phased approach for implementation, as follows:

Effective January 1, 2022, hotel employers shall pay hotel workers no less than $17.64 per hour, to be increased each July 1 by the annual CPI-W adjustment. The paid sick leave, vacation, or personal necessity time set out in the draft Ordinance goes into effect for these hotel workers on this date;

Effective January 1, 2022, employers with 50 employees or more shall pay employees no less than the hourly wage of $15.50 per hour; On July 1, 2022, such employers shall pay employees no less than the hourly wage of $16.50 per hour and paid sick leave, vacation, or personal necessity time as set out in the draft Ordinance to go into effect on this date; On January 1, 2023, such employers shall pay employees no less than the hourly wage of $17.50 per hour;

Effective January 1, 2022, employers with fewer than 50 employees shall pay employees no less than the hourly wage of $15.00 per hour; On July 1, 2022, such employers shall pay employees no less than the hourly wage of $16.00 per hour and paid sick leave, vacation, or personal necessity time as set out in the draft Ordinance to go into effect on this date; On January 1, 2023, such employers shall pay employees no less than the hourly wage of $17.00 per hour.

Effective July 1, 2023, a citywide minimum wage will go into effect for all businesses. This minimum wage rate will be $17.64 per hour, plus two CPI-W adjustments: one on July 1, 2022, and one on July 1, 2023. The specific CPI-W adjustments for July 1, 2022, and July 1, 2023 are not yet known, as the Consumer Price Index has not yet been determined for these dates, but it is likely that the citywide minimum wage rate on July 1, 2023, will be more than $18.00 per hour. Annually thereafter, the minimum wage rate will increase by the annual CPI-W adjustment.

The number of employees shall be determined as follows:

(a) For businesses operational in 2019 or earlier, the number of employees for calendar year 2022 and 2023 shall be based on the average number of employees employed per quarter during the 2019 calendar year.

(b) The number of employees shall be determined using the employer’s total number of individual employees within the United States, regardless of where those employees work.

Additional provisions in the draft Ordinance include:

Provision for the distribution of service charges as follows: Amounts collected as service charges shall be paid to employees and hotel workers equitably and according to the services that are or appear to be related to the description of the amounts given by an employer or hotel employer to the customers; and

Provision for transitional employers as follows: Transitional employers that provide supportive services and transitional jobs for the hardest to employ may pay each employee in a transitional job an hourly wage that is below the established minimum wage during the first 18 months of the employee’s work in the transitional job.

Based on a living wage calculator developed by the Massachusetts Institute of Technology, the appropriate living wage for a single person with no children in Los Angeles County would be $19.35 per hour. The original proposal was intended to create regional consistency for hotel workers. However, while the City Council was discussing the original proposal, the West Hollywood City Council determined that if this wage was regionally appropriate for hotel workers given the significantly high cost of living in the West Hollywood region, all workers — not just hotel workers — must make a wage upon which someone can live.

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[…] has the highest minimum wage in the country and, simultaneously, is the “Most Business Friendly City” in LA County. We’re not sure how […]

A. Deru
A. Deru
1 month ago

Well, I think it’s about time. People who work in businesses here in WeHo couldn’t afford to live in the city they work in. Clearly, that makes sense to pay people a living wage. A comment below said something to the effect of paying people what they are worth. I expect employers to hire people qualified for the work they offer. The well-off are always crying about the expenses. It’s nice to know the city is listening to the workers. I imagine getting help in town should be a lot easier with higher wages as an incentive to come work… Read more »

Jamie Francis
Jamie Francis
1 month ago

To Wehoville, could you please put a limit or a cap on retorts or excessive replies! It would be nice to not always have one particular commenter adding to everyone’s opinion. The last I checked we didn’t need a critique or a follow up with someone who is acting like an editor on this platform who is just another commenter. Please, Wehoville can we ask why some commenters feel the need to comment on everyone’s else comment section who opposes or in some cases agrees with the ordinance and feels the need to chime or asks and in some instances… Read more »

Last edited 1 month ago by Jamie Francis
Larry Block
Admin
1 month ago
Reply to  Jamie Francis

yes i agree some people are monopolizing the conversation and not giving others thoughts a chance to rise. Thank you.

Alan Strasburg
Alan Strasburg
29 days ago
Reply to  Jamie Francis

Putting an end to anonymity in commentary would likely go a long way toward ending the toxicity. Much of what passes for intelligent debate and honest civil discourse often devolves into the invective and ad hominem that are enabled by spineless anonymity.

Harambe's Vengeful Ghost
Harambe's Vengeful Ghost
1 month ago

Rename the city from West Hollywood to North Caracas.

vote them out
vote them out
1 month ago

Makes me wonder how the council members will be profiting from this. How much money will each council member receive for betraying the residents of West Hollywood?

greeneyedguy
greeneyedguy
1 month ago
Reply to  vote them out

They didn’t betray anyone. Raising the minimum wage was an integral part of Shyne and Erickson’s campaign. They were voted in by the residents of this city.

Pride
Pride
1 month ago
Reply to  greeneyedguy

May have been part of their shortsighted, uninformed and fruitless gestures written in campaign promises.

kab1200
kab1200
1 month ago
Reply to  greeneyedguy

I voted for neither of them.

WehoQueen
WehoQueen
1 month ago

When a business pays someone more than they are worth, according to the market setting the correct price, does that make them work harder, give better service, and make them smarter all at once? I wonder how many businesses will close in the first week of this nonsense. Why not let the market set the correct price. When there was an oil boom in North Dakota a few years back, McDonalds in that area was paying people like $50 an hour to work there. That made sense. It was voluntary. The government forcing businesses to pay sometimes twice what a… Read more »

greeneyedguy
greeneyedguy
1 month ago
Reply to  WehoQueen

Los Angeles will raise their minimum wage soon after. Just wait 🙂 The difference will be negligible.

Harambe's Vengeful Ghost
Harambe's Vengeful Ghost
1 month ago
Reply to  greeneyedguy

Oh goodie, then people will just…not have restaurants…or build a subversive black market economy of scofflaws because they’ll realize…taxation is extortion and this is just another form of it.

TomSmart
TomSmart
1 month ago

I give Boa enough of my money to pay these wages. We shall see how many of these businesses are still around despite all of their balling and fussing.

John Wu
John Wu
1 month ago

All it does is create more inflationary price increases at stores and restaurants so we’ll go out less and buy more online. WeHo tax revenues will actually go down because of this decision. But hey, don’t take any public comments from business owners seriously commissioners, you know what you are doing.

kab1200
kab1200
1 month ago
Reply to  John Wu

I totally agree.

where's the business sense?
where's the business sense?
1 month ago

Aren’t there a lot of substandard employees who will be terminated because of this price hike? Some employees just aren’t worth that much money. And they will be easily replaced–people will be standing in line to work in West Hollywood.

Gives a lot of power to the businesses in a perverse sort of way.

Weeping Erica!
Weeping Erica!
1 month ago

This gives businesses much more power over employees. You can pick and choose. Dump the losers and keep the winners. Pay people under the table. Independent contractors. Who is going to patrol the new ordinance? High-paid city employees! Or the SHE? Shyne is too busy coming up with new Woke angles, like keeping unisex toilet anti urinal propositions in business Horvath is too busy campaigning and running her so-called business with all those designers she spoke about last night! And Erickson is too busy putting on purple nail polish and weeping for all of us! It’s a new reality show… Read more »

greeneyedguy
greeneyedguy
1 month ago
Reply to  Weeping Erica!

Can’t stick to one name on here? Why keep changing it?

Harambe's Vengeful Ghost
Harambe's Vengeful Ghost
1 month ago

Yes, that’s exactly what will happen. And a lot of businesses will just uproot or shutdown forever. And anywhere they can do it, businesses will automate.

Recall the SHE
Recall the SHE
1 month ago

Shyne’s big stand for small business is a joke. Where? On Sunset Blvd? AKA Billboard alley. As for Santa Monica Blvd., in the last century there were independent Italian grocery stores, cleaners, small shops, etc. They are all gone. This corrupt nightmare called California is the worst state to do business in. Taxes are more penalized and regulated than the IRS. As for this being Virginia, probably not with the political corruption makes voting a joke. Just look at Bernie being “defeated” by old Hillary.

WeHoMikey
WeHoMikey
1 month ago

West Hollywood is going to obligate employers to pay the same wage that’s applicable in nearby Los Angeles – and everyone screams about it?

JF1
JF1
1 month ago

Well, prices will go up and people won’t go out as much to restaurants and bars. And when they do go out no more tipping for servers as they were making higher, full wage like everybody else. Prices already soared at restaurants recovering from the pandemic. This is crazy. The city is crippling small businesses and they will regret their “feel good” decision. It demonstrates their total lack of education and experience. We are building more affordable housing while everything else – all the goods and services around – will be too expensive for anybody to afford. This new and… Read more »

greeneyedguy
greeneyedguy
1 month ago
Reply to  JF1

The vote was unanimous though. You want to vote them all out?

JF1
JF1
1 month ago
Reply to  greeneyedguy

Yup. Disappointed in Meister. She typically has the most common sense. You watch what happens. Prices have already soared in all the restaurants. Prices will go even higher. Hotels have high vacancies, businesses are trying to recover from the pandemic. Like the chamber of commerce said, it’s a fine ecosystem and the council (with zero input from the business community) just destroyed it. At the very least their should be a tiered system. You currently have waiters and waitresses making $100,000 a year with tips. Tipping for all servers should now be discontinued. This counsel is solely out for the… Read more »

voter
voter
1 month ago
Reply to  JF1

I’m also disappointed in Meister. I thought she had some sense! But if she can’t stand up to the others, it’s time for Meister to lose the next election and vote in someone who will promote the interests of the RESIDENTS of West Hollywood.

Randy
Randy
1 month ago
Reply to  JF1

Do you expect three fresh new faces next November who can do better than D’Amico, Horvath and Meister? Also, prices have soared because COVID forced some businesses to shut down for months, then run at limited capacity. Some had to do build-outs. Some can’t get workers back. Some have to man someone at the door to show proof of vaccination. And some are facing very unreasonable landlords who raise their rent in the middle of, or right after, a pandemic, which I think is the biggest problem, and must be dealt with. But workers are being squeezed, also. The net… Read more »

kab1200
kab1200
1 month ago
Reply to  Randy

You are definitely not a business owner.

Randy
Randy
1 month ago
Reply to  kab1200

What does that have to do with anything? Each business owner incurs their owns costs, and each situation is different. I am, in fact, a small business owner. If Santa Monica and LA can afford it, without an apocalypse, why can’t we?

:dpb
:dpb
1 month ago
Reply to  greeneyedguy

Yes. Every one of them.

greeneyedguy
greeneyedguy
1 month ago
Reply to  :dpb

Good luck! You won’t get very far.

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