Let’s see who shows up

Good jobs and good housing are the goals of progressive economic policies, and both are on the agenda of the Santa Monica City Council tomorrow night. Good jobs, because the council will be joining many jurisdictions around the country in significantly increasing minimum wages, and good housing because the council will considering a report from Housing Commission on how to fund affordable housing construction.

This blog is going to focus on the minimum wage, but jobs and housing are related. Given the real costs of construction and assembling land, one can argue that we don’t have a high cost of housing crisis in the region, but a crisis of low wages.

The decline in real wages over the past three or four decades is a national issue, but the crisis has been particularly acute in Southern California, where immigration of low-skill workers vastly expanded the work force at the same time that good, unionized manufacturing jobs vanished with foreign competition and the end of the Cold War. To a great extent the movement for higher wages got started in the L.A. region with Justice for Janitors and then the living wage movement, including in Santa Monica. About 15 years ago, Santa Monica passed a living wage that applied in the Coastal Zone, but hotels mounted a referendum campaign against it, and in a bitter election that took place in the conservative election year of 2002, they defeated it.

Now, with a notably different national attitude toward wages (minimum wages have been increased, with voter support, all over the country, including in conservative jurisdictions) the movement has come back full circle geographically. The Los Angeles City Council approved a $15.37 minimum wage for hotels in 2014 (currently being phased in) and then, in 2015, a gradual increase to a citywide $15 minimum wage. The County Board of Supervisors followed with a $15 minimum for unincorporated areas that are under its jurisdiction.

Now it’s Santa Monica’s turn. In September the City Council agreed unanimously to pass a minimum wage increase in line with the City and County increases. The council, however, asked City staff to canvass both employers and employees, and their representatives, and the community, on a series of questions concerning various details, some of which the L.A. City Council had left for future resolution. I heartily recommend reading the staff report, in which staff describes the input it received and how it based its recommendations on that input and on the council’s direction. While I’m sure there will be details the council will need to address, staff has suggested good faith compromises that try to resolve practical issues raised by both employers and employees.

That doesn’t mean there isn’t controversy, most of which surrounds the provision council is poised to pass allowing union collective bargaining agreements to supersede the minimum wage. I have previously explained why I support “supersession,” but it’s worth noting that supersession is hardly new. It’s in all of the development agreements the City has entered into for hotels that have a minimum wage provision. Supersession by another name, “preemption,” is part of federal labor law, and it’s been held, for instance, that a collective bargaining agreement’s overtime provisions preempt local law. Supersession is also in the 2014 L.A. minimum wage for hotels, and that provision has been approved in court (ironically in a case that said that said that labor law did not preempt the minimum wage).

Supersession wouldn’t be much of an issue tomorrow night in City Hall but for the efforts of a mysterious group that calls itself variously, the “Employment Policies Institute,” “Fair Wage Santa Monica,” or the “One Fair Wage Coalition.” Since September this group has been campaigning against supersession. If you live in Santa Monica and you watch YouTube, you probably have seen anti-supersession commercials from these guys, whoever they are.

I say “mysterious” and “whoever they are” because the public representatives for the campaign won’t say who is putting up the money for it. It’s not hard to find out though, at least in general terms. Back in September the campaign started with newspaper ads, and they were identified as coming from the Employment Policies Institute (EPI), an established anti-minimum wage, anti-union organization. EPI is associated with the right-wing provocateur Richard Berman. Berman is a controversial figure known, among other things, for establishing non-profit groups to raise money for right-wing causes, which groups then use the money to hire him to run campaigns.

It’s a living.

Sure enough, the Santa Monica anti-supersession campaign looks like a manufactured, artificial campaign. Why? Primarily because it’s been so out-of-touch with how Santa Monica politics work. I mean, YouTube commercials? (Maybe they should have learned something from the aviation’s failed bid in 2014 to make Santa Monica Airport permanent.)

Local employers, such as the hotels that opposed the living wage in 2002, or local restaurants, have addressed their comments to staff and (presumably) lobbied council members. As I said before, the staff recommendations strike reasonable compromises on various practical matters that concern both employers and employees, and the council members will also no doubt be looking to tweak the ordinance to make sure that it will work.

Why would national players like Berman get involved in Santa Monica? I suspect that the reason, aside from simple ideology, is that Los Angeles has yet to make its decision about supersession, and Santa Monica will to some extent establish a precedent. Berman is likely using Santa Monica as a test case, to show his backers what he can do.

It’ll be interesting to see who shows up tomorrow night from the One Fair Wage Coalition.

Thanks for reading.

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.