Casinos & Hotels

Los Angeles Hotel Workers on Track for Minimum Wage of $15.37

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The Los Angeles City Council is scheduled to take a final vote next week on a proposal to raise the minimum wage for workers at the city’s large hotels to $15.37 an hour. The council gave preliminary approval to the measure by 12 to 3 vote on Wednesday, and Mayor Eric Garcetti has said he will approve the ordinance if it makes it to his desk for signature.

If the bill is approved, it would take effect on July 1, 2015, for hotels with at least 300 rooms. On July 1, 2016, the ordinance would start to apply to hotels with at least 150 rooms. Hotels may plead financial hardship and be granted an exemption from the law in order to prevent layoffs, according to a report at CNBC.

The ordinance is expected to apply to at least 40 hotels and between 5,300 and 13,500 workers. The measure will not apply to hotels where workers are represented by a union.

Large hotels have been singled out, supporters of the measure say, because the city has made substantial investments to benefit the hospitality industry. One study found that tax subsidies to four downtown hotel projects will cost the city $500 million in tax receipts over the next 30 years.

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Hotel owners, of course, oppose the measure. Some have warned that higher wages could lead to layoffs and could even discourage new hotel construction. Others claim that workers who receive tips should not be included among those employees covered by the law. The Hotel Association of Los Angeles has asked for more discussion of the measure and is supporting a minimum wage of $13.25 an hour.

Mayor Garcetti has pledged to raise the minimum wage in the city to $13.25 by 2017, a modest proposal given the recent pay hikes to $15 in Seattle, San Francisco and other cities. San Diego is fighting over a proposal to raise the minimum wage in that city to $11.50 by January 2017.

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