Raising the Wage

Lately I’ve been writing about politics qua politics, namely the firing of Elizabeth Riel, but I’m going to take a break from that saga to write about something in the real world, namely raising the minimum wage in Santa Monica, a matter that comes before the City Council tomorrow night.

Hey, it’s refreshing to write about an issue that doesn’t have much to do with traffic. Instead, like homelessness, housing affordability, the achievement gap, and gang violence, not to mention latent ethnic and racial discrimination and prejudice, the minimum wage is a true social justice issue—the kind of issue that should be the focus of much more governmental attention and political activity.

After years of agitation, including in Santa Monica, for living wages tied to specific factors, in the past few years a movement has arisen nationally to raise the minimum wage for all workers. In this connection, the City of Los Angeles this summer passed a local minimum wage that will increase the hourly minimum to $15 by 2020 for most businesses. The County of Los Angeles followed suit for for unincorporated areas. In response, the Santa Monica City Council directed staff to work on raising the overall minimum wage in Santa Monica, and tomorrow night the staff will be presenting its recommendations.

For the most part there is little controversy, as Santa Monica will adopt wage rates consistent with those of Los Angeles. It doesn’t make sense for the region to have different minimum wages. There are, however, a number of details that need to be worked out, some in areas where the Los Angeles City Council has deferred decisions.

In Santa Monica these principally involve: (i) whether for unionized businesses, union contracts will supersede the minimum wage ordinance (“supersession”), (ii) sick leave policies, (iii) how businesses can utilize service charges, (iv) enforcement issues, (v) seasonal workers, and (vi) whether, as in Los Angeles, there should be a separate minimum wage schedule for hotel workers (which L.A. enacted before the general minimum wage increase). According to the staff report, staff recommends resolving some of these issues, such as union contract supersession now, but leaving other issues for later action.

As the saying goes, the devil is in the details, and I tend to agree with local living wage activists such as Vivian Rothstein, who are asking the council tomorrow night not to pass an ordinance, but to treat the evening as a study session so that more data can be collected and discussed on what are complicated issues. The idea is that the Council has time to work on and pass a more comprehensive ordinance later.

One complicated issue is whether union contracts should supersede the minimum wage. Santa Monica has always allowed this policy when it has required higher minimum wages in development agreements, and staff recommends including supersession in the City’s ordinance. Nonetheless, according to the staff report some businesses are objecting by saying that supersession gives unionized businesses an advantage over non-union businesses.

It’s not only some business interests who question supersession, but supporters of higher minimum wages are also divided. Some cities with local minimum wages, including Chicago and San Francisco, allow union supersession, others, such as Seattle and San Diego, don’t. The union movement is also divided; for instance, the Los Angeles Federation of Labor has asked for supersession to be included in the L.A. ordinance (the L.A. City Council has deferred action on the question), while the powerful Service Employees International Union opposes supersession.

And then some conservatives, who aren’t in favor of raising the minimum wage in the first place, say that the only reason unions want the exemption is to make sweetheart deals with employers to increase their membership numbers.

I try to look at the question from the perspective of what’s better for the society as a whole, and although I can appreciate some of the arguments against supersession, I favor it.

To me, to allow union contracts to supersede the minimum wage puts a lot of pressure on unions—a lot more pressure on unions than on non-union businesses. To organize workers, unions must be able to persuade them that by unionizing they will do better than how they are doing without unionizing; an increased minimum wage sets the bar higher. It’s unlikely that workers will sign up or stick with a union that doesn’t get them a package that is at least as good as the minimum wage.

If unions are willing to confront this challenge, however, they should be allowed or even encouraged to do so, because the benefits to the society of unionization, over simply relying on an increased minimum wage, are many.

Union contracts, because they can deal with so many subjects beyond wages, matters including healthcare, pensions, and other benefits, as well as hours, work schedules, and security, are beneficial not only to workers, but also to our society, because they take care of workplace issues that government is best kept out of. (In fact, you’d think this should be a conservative argument—if you don’t want governments meddling in your business, don’t fight union organizing!) Unions also enforce their contracts, saving government from having to enforce minimum wages and working conditions. (Again, do conservatives want more bureaucracy?)

In contrast, the argument that supersession would penalize nonunion businesses doesn’t take into account the real world obstacles to union organizing inherent in the fractured employment landscape we have today.

For these reasons, I hope that Santa Monica allows for supersession and leads L.A. to the same conclusion.

Thanks for reading.

5 thoughts on “Raising the Wage

  1. Pingback: Let's See Who Shows Up | Santa Monica Next

  2. Pingback: Let’s see who shows up | The Healthy City Local

  3. I have to disagree with you on exempting unions from the minimum wage. They can still bargain for other benefits. A greater concern that I have is that funders, such as Medicaid, for nonprofit social service organizations are not likely to increase their funding for services to cover the mandated increase in the minimum wage. I am for a higher minimum wage but the city should also increase their payments to social service agencies which are probably at their maximum of fund raising and can’t raise their fees for most clients.

    The increase in the minimum wage also has a substantial ripple effect due to wage compression. That’s good, if the employer can raise prices or fees, but a big problem for some nonprofits already being squeezed by flat funding rates by government. I think Home Boys raised this issue with the city or county to no avail. A powerful example of an unfunded mandate. .

    I also hope city council will not rush into a decision and also not micromanager as is often the case.

    • Tom — there’s a lot of discussion in the staff report about non-profits — you’re right, it’s another reason the council can slow down and study all these issues.

  4. Pingback: Raising the Wage | Santa Monica Next

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