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Council Will Consider $15 Minimum Wage for Santa Monica

Santa Monica Real Estate Company, Roque and Mark

Pacific Park, Santa Monica Pier

Harding Larmore Kutcher & Kozal, LLP  law firm
Harding, Larmore
Kutcher & Kozal, LLP

Convention and Visitors Bureau Santa Monica

By Jonathan Friedman
Associate Editor

September 25, 2015 -- Santa Monica’s lowest wage earners could soon get a raise. The City Council on Tuesday will consider a gradual minimum wage hike that calls for it to reach $15 in 2020.

If approved by the council on Tuesday and again on a second reading next month, the proposal would go into effect next July with workers earning $10.50 per hour. It would increase to $12 in 2017, $13.25 in 2018 and $14.25 in 2019.

The current minimum wage in Santa Monica is the one mandated by State law -- $9 per hour. It will go up to $10 next year.

Council members in June voted for City staff to study the potential for a minimum wage increase.

Mayor Kevin McKeown said at the June meeting that boosting the salary of low-wage workers would allow the city “to join the regional move toward higher wages for all employees.”

The Santa Monica proposal closely follows the one approved by the Los Angeles City Council in June. There are some differences, Finance Director Gigi Decavalles-Hughes wrote in the report to the council.

Among the differences are that businesses with employees who have a collective bargaining agreement would be exempt. This was requested by the council at the June meeting. There would also be an exemption for seasonal and trainee workers.

If a business adds a service charge for customers, that money must go to the employees and not be used to offset the cost of the wage increase.

“The primary goal of raising the minimum wage is to increase the pay of low-wage workers at a time when their share of overall income has declined and the cost of housing has risen faster than inflation,” Decavalles-Hughes wrote.

She continued, “Economic research literature agrees that minimum wage laws achieve this goal, and consistently finds that the affected workers are mostly adults, and disproportionately women and people of color.”

The City hired a consultant to research the effect of the wage increase on Santa Monica and to do community outreach.

This research determined the increase “would likely have less impact on employment, prices, and the overall economy than what is estimated for Los Angeles” because local employees are already paid better overall and for other reasons, Decavalles-Hughes wrote.

Representatives from various businesses and nonprofits attended the three outreach meetings. Several people said they supported the concept, but also there were many who were concerned about the effects of an increase, according to Decavalles-Hughes’ report.

The Chamber of Commerce has not taken a position on the proposal, but the board of Downtown Santa Monica, Inc. (DTSM), which represents area businesses, voted unanimously last month to support the proposal.

“Overall, there was support of [City] Council’s interest in the issue and effort to address those in the workforce earning a minimum wage,” Decavalles-Hughes wrote.

This is not the first time a higher minimum wage has been proposed for Santa Monica. A proposal was placed on the November 2002 ballot to raise the rate to $12.25 per hour for certain businesses.

The measure was rejected in a close contest in which 51 percent of the voters opposed it.

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