The Los Angeles City Council voted 14-1 Wednesday to approve an emergency ordinance to require large grocery and pharmacy retailers to offer employees an additional $5 per hour in hazard day amid the COVID-19 pandemic, but because the ordinance was not unanimously approved on its first reading, the final vote will come during a second reading on March 3.
“Fair compensation is the very least that our grocery store workers deserve after all they have done for us,” said Council President Nury Martinez, who introduced the original motion with Councilman Mitch O’Farrell.
“Cashiers, stockers, baggers and so many more have risked their lives every day since March making minimum wage to make sure we have everything we need to stay safely at home to get through this crisis. While these companies have seen massive profits, it has not trickled down to their employees. These companies can afford to pay the hazard pay, they just don’t want to.”
The $5 hazard pay would be required for all non-managerial employees at grocery or drug retail stores with more than 300 employees nationwide, or more than 10 employees on-site, as well as retail stores, such as Walmart and Target, that dedicate 10% of their sales floor to groceries or drug retail.
The hazard pay would be given in addition to employees’ base wages for the next 120 days. According to a report by Los Angeles’ chief legislative analyst, which cited ZipRecruiter, the average grocery store worker in Los Angeles earns $17.51 an hour.
During Los Angeles Mayor Eric Garcetti’s COVID-19 briefing Wednesday, he spoke about his support for the ordinance.
“I absolutely 100% support the hero pay for our grocery workers and with any good conscience, it shouldn’t raise food prices because grocery stores are one area that have record profits, more money than they’ve had before,” Garcetti said. “I hope they will see this and maybe be inspired by it instead of being threatened by it.”
The vote came a week after West Hollywood approved a nearly identical hero pay ordinance. However, the West Hollywood ordinance only covers grocery stores. The WeHo City Council is expected to extend its ordinance to include drug stores and other big-box retailers like Target at its next meeting on March 1.
The LA City Council vote also came a day after the Los Angeles County Board of Supervisors adopted an urgency ordinance to require $5 additional pay for national grocery and drug retail employers in unincorporated areas of the county.
Long Beach was the first city in the SoCal area to enact a hero pay ordinance, requiring an extra $4 hazard pay for grocery workers. In response, the Kroger Company announced earlier this month that it would shutter two of the Long Beach stores it owns, a Ralphs and a Food 4 Less.
The California Grocers Association has filed federal lawsuits against the cities of Long Beach, West Hollywood and Montebello, seeking to declare hazard pay mandated by those cities as invalid and unconstitutional, contending that grocers will not be able to absorb the additional pay without raising prices, closing stores, reducing hours or laying off employees.
“Supermarkets, as we all know, have made high profits, and yet some are threatening to close. It’s clearly out of spite or out of an attempt to leverage us,” Councilman Paul Koretz said Wednesday.
The city of Los Angeles’ chief legislative analyst determined the ordinance could have unintended consequences. Those finding suggest companies might:
- Raise prices to offset additional wage costs.
- Reduce hours and/or benefits for employees to keep costs under control.
- Lay off employees.
- Close under-performing stores.
- Create more “food deserts” where residents in some areas don’t have easy access to fresh groceries because of the store closures.
- Create greater “food insecurity” for low-income and fixed-income residents who would have less money to spend on food because of price increases.
However, the chief legislative analyst (CLA) also determined that the higher wages could also benefit other city businesses, as more people would have extra money to buy additional goods. It could also help people pay down their debts and increase their savings, according to the report.
“As the CLA report makes clear, this ordinance comes with trade-offs for both retailers and employees, pros and cons with anything we do, but it should be appreciated that this effort is a temporary measure that increases wages of our grocery and retail workers,” Councilman Mark Ridley-Thomas said. “I want to underscore that it is a matter of justice.”
O’Farrell also cited a moral argument for the ordinance:
“Our grocery store workers continue to show up every day, serving customers and providing the essentials that residents across the city need to stay safer at home,” he said. “Their greater risk of exposure to COVID-19 is by definition hazardous work and the money they earn should be commensurate with those risks associated on the job.”
Councilman Curren Price said: “There’s only one reality under these circumstances and that’s the immense risks, the danger that our grocery workers are exposed to every time they clock in … the CLA report that we had received found that the mortality rate for Latino workers in food and agriculture has gone up by 59% because of this pandemic and for Black workers in retail at 36%. Those are not small numbers,” Price said.
“Providing these workers with $5 hazard pay for the next 120 days is the least we can do.”
Councilman John Lee, the only council member to vote no on the ordinance, said he hoped the council could come up with a different solution than this ordinance, which he called “a gross overreach of government into business and what they should be paying their employees.
“At the end, I don’t want to affect the people who are going to be hurt the most by this, and that is the people who live in the poorest communities of the city of Los Angeles, the people who live in my district … my biggest fear is for the hard-working families in those areas,” Lee said.
Councilman Gil Cedillo spoke about the difficulty that already exists opening a grocery store in Chinatown, in his district.
“Mr. Koretz, you may not have a problem having a supermarket in Westwood, but I can’t get one in Chinatown … while I support this (ordinance) wholeheartedly, I want us to also recognize that reality … for example, when the Walmart made a business decision to leave Chinatown, they left a void, and so what we have there is an exercise gym, but we don’t have a supermarket for residents of Chinatown.”
The ordinance needed to be unanimously approved in order to pass on its first reading. Because Lee voted no, the ordinance will have a final vote on March 3.
