The Los Angeles Times is reporting that a panel of city lawmakers approved a draft of the ordinance that would raise the Los Angeles-2minimum wage in Los Angeles to $15 per hour by 2020, moving the ordinance one step closer to passage.  There was a backlash this week against the labor unions that were pushing hard for the minimum wage increase, but at the last minute this week are seeking to have organized labor excluded from the increase.

In addition to having union members excluded from the minimum wage increase, there are still additional proposals that may also become law.  For example, late this week, a change was proposed to the ordinance to require Los Angeles employers to provide 12 paid days off each year.  It is unclear if the 12 paid days off would be for sick leave, or even vacation, but the council is considering this addition. Apparently this paid time off has been taken out of the proposed ordinance for now, but the council will send the proposal to the chief legislative analyst for review, and the ordinance could still be amended to add this requirement at a later date.  For now, the union exemption and the paid time off has been removed from the ordinance, and the city council is set to vote on the ordinance next week.

Many open questions still exist about the ordinance:

  • What rate must employees be paid who are traveling though or temporarily working in Los Angeles?  The LA Times reports that at today’s hearing, the city lawyers said that the law would apply to workers working at least two hours in a workweek in Los Angeles.
  • What about workers who split their time in Los Angeles and outside of Los Angeles?
  • What agency would enforce the city’s super-minimum wage?  Because it is a city law, the state labor commissioner would have no jurisdiction to enforce the law.  The city council believes that the enforcement unit would be comprised of five people, costing the city about $500,000 per year.  No doubt this enforcement arm would have to increase in order to have any potential way to enforce the new law.

The city is also considering the possibility of restricting restaurants from imposing mandatory service charges on customers.  Legally, when a restaurant imposes a service charge on a customer, that service charge becomes the property of the restaurant, unlike a tip left for the service staff.  The restaurants could prohibit tipping and simply charge the mandatory service charge.  By doing this, restaurants could then use the service charges as they wanted to, they could use this money to pay the higher minimum wage rates, distribute more of the service charge to the back of the house employees, or use it to off-set other costs.

It will be interesting to see what is passed next week by the city council, stay tuned.