UC system minimum wage increases to $13 per hour

As reported by the San Jose Mercury News:

The University of California’s plan to raise the minimum wage for all workers systemwide took effect Thursday, the first of three incremental raises expected to bring wages to at least $15 an hour by 2017.

The minimum wage rose to $13 an hour for all university employees hired to work 20 hours or more a week. It will be increased to $14 an hour on Oct. 1, 2016, and to $15 an hour on the same day in 2017.

UC president Janet Napolitano announced the voluntary minimum wage increase in July, the first of its kind to be established by a public university.

Click here to read the full article

What Unions Really Think Of The $15 Minimum Wage

Minimum wage1The Employment Policies Institute (EPI) released multiple ads Tuesday criticizing union leaders for seeking an exemption to their own $15 minimum wage proposal in Santa Monica.

The ads included a newspaper spot and mobile billboard. They called the request for an exemption hypocrisy. Unions have been at the forefront of pushing for the Santa Monica minimum wage proposal. Union leader like Rusty Hicks have also been pushing an exemption to the proposal for unionized workers.

?Labor boss Rusty Hicks was criticized nationwide after he tried to sneak a union exemption to a minimum wage bill he pushed in Los Angeles,? the ad declared. ?Now, he?s at it again in Santa Monica.?

Hicks also sought an exemption when his own city of Los Angeles voted in May to increase its wages to at least $15 an hour. This despite him leading the coalition behind getting the measure passed. Despite national criticism, Hicks has since moved on to encourage other cities to increase their wages while exempting unions.

?I think they should ask themselves what?s the motivation,? EPI Research Director Michael Saltsman told The Daily Caller News Foundation. ?Are unions supporting this just to help themselves and boosts their own ranks.?

Hicks has defended his stance. He argued both the $15 minimum wage and an exemption for unions will help workers.

?This clause preserves and protects basic worker rights and that is why nearly every city in California that has ever passed a minimum wage ordinance has included these protections,? Hicks said back in May. ?I would never do anything to undermine the rights of any worker.?

Even other union leaders have criticized Hicks for wanting an exemption while continuing to advocate for a higher minimum wage. David Rolf, president of Local 775 of the Service Employees International Union, questioned the justification behind the request.

Despite this, it is not at all unusual for unions to opt out of laws which raise the minimum wage. According to a report?released by the U.S. Chamber of Commerce last December, many labor unions are exempt from the various local minimum wage laws they support.

?Not all minimum wage increases come in the same form,? the report notes. ?Some local ordinances in particular include an exemption for employers that enter into a collective bargaining agreement with a union.?

The report details how these ?escape clauses? are often designed to encourage unionization because they make membership a low-cost alternative for employers. This raises questions about who these minimum wage laws are actually meant to help, according to the report.

Originally published by the Daily Caller News Foundation

Follow Connor on Twitter

San Jose joins forces with seven other cities to raise minimum wage

As reported by the San Jose Mercury News:

SAN JOSE — Top officials from seven Bay Area cities will join Mayor Sam Liccardo on Thursday to announce an unprecedented joint venture to raise the minimum wage across the valley in a regional effort to close the growing gap between the rich and the poor in Silicon Valley.

The official announcement is expected in a news conference Thursday. The mayors of Campbell, Palo Alto, Cupertino, Milpitas, Morgan Hill, Monte Sereno and a representative from the city of Santa Clara are expected to announce their support for the initiative.

It’s the first time the region has seen such a large collective effort by multiple cities to raise wages. …

Click here to read the full story

CA Cities Engage in Minimum Wage Arms Race

Minimum WageForging ahead with plans?to take minimum wages to new highs, California?s San Francisco Bay Area has touched off tit-for-tat increases, deepening fears that the region?s high cost of living has become a business-killer.

A growing dilemma

?Berkeley?s City Council approved a hike in June 2014 that will lift the minimum wage to $12.53 by next year,? the Los Angeles Times noted. ?In November, voters in San Francisco and Oakland overwhelmingly approved increases, with San Francisco on track to hit $15 before Seattle does. Oakland went up to $12.25 this year.? Then, last month, nearby Emeryville surpassed Berkeley and Oakland with?a $14.44 wage; ?Berkeley sent its labor commission back to the drawing board. The council next month is expected to take up a proposal that would add paid sick days, extend wage hikes until they hit $19 in 2020 and then add cost-of-living increases in perpetuity.?

The upshot for businesses has been mixed at best: although some employers have crafted clever strategies for adding more value for customers, others have worried the path is unsustainable. ?The necessity of paying people a living wage in the Bay Area is clear, so it?s hard to argue against it, and it?s something I?m really proud to be able to try doing,? one pizzeria owner told the Times. ?At the same time, I?m terrified of going out of business after 18 years.?

As?big wage increases have been passed into law across California, business interests haven?t always been the only ones to pump the brakes. In Los Angeles, where the city minimum is a?$15 wage, critics of the increases howled when labor advocates wound up asking for a waiver?on the eve of its passage. ?The exemption was left out of the law?s final version after criticism from the local chamber of commerce and business groups,? noted the Wall Street Journal. ?But similar exemptions are included in at least three other Los Angeles laws, including a minimum wage for hotel workers approved last year.?

Recalibrating business

Although California has led the country in grappling with stagnant wages and rising costs of living, the turn toward higher minimum wages has touched off broad debates across the country. Hospitality businesses?such as the hotel industry?have faced a particular challenge as wages have climbed upward.?For years, bar and restaurant groups have lobbied policymakers to think twice,?warning?that dramatically hiking wages would undermine their business models, which?politicians?and analysts have?often?built into their?assumptions about jobs and economic health.

?The problem with the minimum-wage offensive is that it throws the accounting of the restaurant industry totally upside down,? as?Harold Miller, a restaurant consultant currently serving as vice president for franchise development at Persona Pizzeria, told?the Chicago Tribune.

In?tech-forward areas with high costs of living and high rents, the threat to the hospitality business model has accelerated the?shift toward increased automation and decreased employment rolls.

Stalling statewide

Some California employers have set out to?recalibrate their work forces,?hoping that a shift?to more temporary workers could blunt the economic impact of wage increases. But the political impact of such a shift has also become a problem. Faced with criticism over differential treatment between?contract and career employees, the?University of California system offered a $15 ?minimum wage? set to apply to thousands of contract workers on a private, not public, payroll.

UC unions were still left cold. ?Private contract firms will still make as much as $10 an hour or more?in profit?off the labor of workers being denied the same wages as UC workers doing the same jobs,? wrote the president of the system?s largest employee union in the San Francisco Chronicle. ?UC could choose to send a different message by supporting?SB376,? she argued, ?legislation that would guarantee the employees of UC contractors equal pay as career employees doing the same work.? That bill was?authored this spring by state Sen. Ricardo Lara, D-Bell Gardens.

But the latest Golden State bellwether, a bill creating a?statewide $13 wage introduced by state Sen.?Mark Leno, D-San Francisco, could signal that the minimum wage wave may be cresting. As the Sacramento Business Journal observed, Leno?s effort ?moved farther than it did last year, but the bill?s fate is far from assured.? Although Gov. Jerry Brown has ?proposed to tackle income inequality this year through an earned income tax credit,? he has declined to comment on the push for a $13 wage ? letting a skeptical Department of Finance speak for him.

Long Beach Could Be Next In $15 Minimum Wage Movement

Minimum wage1In the past year the movement to raise the minimum wage to $15 an hour has seen success in a few major cities ? and now several more are looking to be next.

Seattle led the way in implementing a $15 minimum wage back in June 2014. San Francisco and Los Angeles followed not long after. Each local ordinance phased in the new wage over the course of several years. Though it has yet to pass on the state or federal level, the movement has seen support across the country.

Still early on in the process, officials in Washington, D.C., Kansas City, Mo., and Long Beach, Calif., are considering whether they should adopt a $15 minimum wage as well. Earlier in the month,?Long Beach announced?it may initiate a study of the potential impact such an increase would have. The Kansas City Star?reported?Thursday that the Kansas City Council may seek voter input on the November ballot. D.C.?announced last month it?will test the waters with a ballot measure as well. New York City is also considering whether to implement a $15 minimum wage,?but just for fast-food workers.

In addition to the cities that have already passed a $15 minimum wage, the University of California announced last month that the school will become the first public university to raise the on-campus minimum wage to $15 an hour. Democratic presidential hopeful and self-described socialist Bernie Sanders has even introduced a bill to raise the federal minimum wage to $15 an hour.

Supporters of the $15 minimum wage?often claim it will help the poor and stimulate economic activity. They argue that it?s more representative of ?the living wage,? which is the supposed basic standard by?which someone can live comfortably.

Opponents, however,?say the idea will actually?hurt the poor by limiting job opportunities. How little or how much of either outcome usually depends on the study. Nevertheless, even the nonpartisan Congressional Budget Office agrees at least some job loss is expected.

By organizing rallies and utilizing media marketing campaigns, Fight for $15 has led much of the effort to raise the minimum wage in the last couple of years. Though claiming to be a grassroots workers movement,?the group is highly influenced and funded?by the Service Employees International Union.

The?SEIU?has been criticized by some, like Worker Center Watch,?for using the Fight for $15 protests as a way of bypassing labor laws to more easily unionize fast food workers.?According to a report from the Center for Union Facts, a minimum wage increase would benefit the?SEIU?directly while hurting non-unionized?SEIU?competitors.

Additionally, unions often seek exemptions from the very minimum wage laws they support.?According to the report, ?Labor?s Minimum Wage Exemption,??which was released by the U.S. Chamber of Commerce in December, this is to encourage unionization by making membership a?low cost?alternative for employers. Los Angeles union leader Rusty Hicks was accused of just that when?asked for an exemption for unionized businesses?from the very wage increase he advocates for. Now he is pushing for Long Beach to go forward with its own increase.

Follow Connor on Twitter

A Lone Voice ? Voting Against the Minimum Wage Hike in L.A.

Minimum wage1City Councilman Mitchell Englander was the lone no vote against raising the minimum wage in Los Angeles to $15 an hour. It would be over the top to suggest his stand was akin to Gary Cooper in?High Noon?? one man standing against the threat to the town ? but suffice it to say it was important for someone to stand up and point out the concerns raised by the business community and others. The minimum wage issue is not as clear-cut as the lopsided vote in the L.A., City Council would indicate. Important issues surrounding the implementation of the minimum wage must be raised.

Englander explained his reasoning in a Los Angeles Times?opinion piece?last Monday.

Some excerpts:

?This wage increase may hurt the very people it is designed to help. Most minimum wage jobs are in low profit-margin industries or small businesses that are easily relocated to one of more than two dozen cities bordering Los Angeles. Many of these cities have minimum wages substantially lower than $15 an hour. This competitive disadvantage doesn?t support local job creation or retention.?

?Representatives of both the business and nonprofit/charitable communities testified that they will be forced to reduce hours or staff size to comply with the new policy.?

?Minimum-wage increases by themselves do nothing to expand the middle class. In order to do this we need to create an educated workforce, bringing back trade training and shop classes to our high schools and encouraging a clear and affordable pathway from two-year colleges to four-year universities and beyond.?

?I voted no on the increase because cost-benefit analyses show that the disproportionate burden to business is not balanced by a guaranteed benefit to the impoverished, or to the local economy.?

Englander?s reasoning obviously did not sway other members of the council. But while the city can create laws to control business ? one law they are discussing is to require a minimum wage for workers whose home base is outside of Los Angeles but their work brings them into the city for at least two hours ? city council members cannot repeal the laws of economics. They will be consequences to the council?s actions.

The minimum wage increase is not the only mandate faced by many businesses in California. Required minimum wages, mandated time off, fees, and taxes add to business costs making it tougher and more complicated to do business in California.

Englander was right to make his lonely stand so that these issues can be aired and remembered.

Originally published at Fox and Hounds Daily

Fed?s monetary policies stoke income inequality

MoneyIncome inequality has been in the public consciousness recently, causing policymakers to redouble our efforts to remediate poverty and preserve what is left of the middle class. But aside from a small group of contrarian economists, few people, and most certainly few policymakers, have been willing to discuss the primary cause of income inequality in the last generation.

When Congress created our central bank, the Federal Reserve, its missions were to be a ?banker?s bank,? a lender of last resort for banks whose deposits were overextended or loans oversubscribed, and to hold enough gold in reserve to meet the needs of the nation during economic panics. Those functions are how it got its now somewhat deceptive name, which implies that the Federal Reserve is a place where money is stored ?in reserve.?

In modern times the Federal Reserve?s primary undertaking has been tinkering with interest rates, to fulfill its modernized mandates of controlling inflation and assuring full employment. It hasn?t done a great job at either, and has created a damaging wealth disparity that will affect our nation for generations.

American wealth disparity now exceeds the vast chasm of the Gilded Age, immediately before the Great Depression. Income inequality in the U.S. is so extensive that our own CIA compares us to such kleptocracies as Cameroon and Russia. A short, 10-minute drive through Los Angeles exposes this disparity, in our own backyard. California of the future runs the risk of devolving into Marie Antoinette?s France, where the oblivious rich ostentatiously display their fortunes, while scores of commoners look on with a mix of envy and rage.

The Federal Reserve plays the predominant role in this condition. In the last decade, it has created trillions of dollars and kept interest rates epochally low. ?Printing? money invariably leads to inflation somewhere, and for a long time, the Fed?s actions drove up the cost of everything from food to gasoline. To avoid runaway inflation, our nation had to change. The last domino before runaway inflation is wage inflation. To keep up with the rising cost of goods, wages must increase too. But this has not happened. The average family today makes about as much as they did in 1980.

This is because the system ? Congress, corporations, and covetous world leaders ? instead reacted with globalization, i.e., free-trade agreements and a complete liberalization of trade and tariff policies that took jobs like manufacturing, previously done by well-paid Americans, to sweatshops overseas. Many American families can no longer afford the things we want, from air conditioners to iPhones, unless they are made overseas with $5-a-day labor.

But the Federal Reserve?s biggest contribution to wealth disparity, and the one that will take generations to change, is the effect of its money-printing policies on asset prices. The newly created money cascading down Wall Street must be invested somewhere.

The property and stock-market bubbles, which the Federal Reserve now acknowledges it created, have benefited the gentry, because the rich own far more property and stocks than the poor. When those assets geometrically expand in value but wages stagnate, the result is tremendous wealth disparity. Yet when the Fed-created bubbles contract, the middle-class wage earners foot the bailout bill.

Are there small-scale solutions available to policymakers? Sure. For example, I support raising the minimum wage. But many of these efforts amount to using a squirt bottle to extinguish a three-alarm fire. They are not enough. Raising someone?s pay from $25,000 a year to $29,000 every 10 years will not foster a more egalitarian society if easy-money policies continue to expand geometrically the vast fortunes of the fantastically rich.

The people who created our nation explicitly prohibited royalty, and warned that vast concentrations of wealth could make our nation like the tumultuous societies many Americans tried to escape. Lawmakers at every level of government ? and citizens, alike ? should question the monetary policies of the unelected Fed bureaucrats. I fear that their far-reaching decisions are enshrining an inequality in our society that no legislation at the federal, state or local level can ameliorate.

Assemblyman Mike Gatto, D-Burbank, represents the 43rd District.

Originally published by the Los Angeles Daily News

Do L.A. Council Members Pay Their Gardeners, Cleaners at Least $15 an Hour?

Amid Los Angeles City Hall?s push to raise the city?s minimum wage to $15 by 2020, some city lawmakers say they already are paying at least that hourly rate to the gardeners, housekeepers and baby sitters who work at their homes.

South LA and downtown City Councilman Curren Price, who co-introduced the minimum wage ordinance, employs a housekeeper and pays her more than $20 an hour, a Price spokeswoman said.

Price declined to release her name, citing privacy concerns.

On the east side of Los Angeles, City Councilman Mitch O?Farrell pays two gardeners $60 a month for about an hour?s work total at his home, an O?Farrell spokesman said.

Like Price, O?Farrell ? and the other council members who responded to this news organization?s questions about outside workers ? declined to release the names of the workers.

Council members earn $184,610 annually, among the highest in the country for city lawmakers.

Those making the $9-an-hour minimum wage earn about $16,000 annually, according to a UC Berkeley studycommissioned by Los Angeles Mayor Eric Garcetti.

Asked what hourly wages council members pay for household services, about half the 15-member council declined to comment or didn?t respond to the request.

City Councilman Felipe Fuentes, who represents parts of the San Fernando Valley, has contracts with businesses that provide household services and a child care provider, all of whom he pays above $15 an hour, his spokeswoman said.

The councilman also pays for vacation and sick time, she said.

Valley Councilman Bob Blumenfield and his family also hire employees to handle home maintenance and child care-related tasks, a Blumenfield spokesman said.

Those employees ?earn decent wages in excess of $15 per hour in addition to vacation, sick time, social security and other benefits,? the spokesman said.

The hourly mean wage for housekeepers and cleaners in the greater Los Angeles metropolitan region is $12.17, according to the U.S. Bureau of Labor Statistics. The figure is $11.06 for child care workers.

Amid sometimes emotional debates about the minimum wage and economic inequality, several council members have cited their humble upbringings in arguing for a citywide pay hike.

At a council meeting two weeks ago, Price recalled growing up in a working-class family in South LA, while Councilwoman Nury Martinez said her father made $13,000 a year as a dishwasher.

In raising wages, Los Angeles is poised to join Oakland, San Francisco and Seattle in hiking citywide pay.

Garcetti first proposed the hike last year, telling crowds at a South LA event that the city?s $9 wage is a ?poverty wage.?

Garcetti resides in the Getty House, the official mayoral residence, with his family. Garcetti spokesman Jeff Millman said the mayor pays any worker in his household ?at least? $15 an hour.

At least three City Council members ? Gil Cedillo, Tom LaBonge and Bernard Parks ? said they don?t hire any outside workers. Parks, who has two grandchildren, said: ?I baby-sit periodically for free.?

Originally published by CityWatchLA.com

(Dakota Smith covers City Hall for the Daily News. ?She can be reached? at [email protected]. Posted originally by the Daily News.)

Union Hypocrisy At Its Worst

Just a week after the L.A. City Council voted in support of a $15 minimum wage, Rusty Hicks, the head of the Los Angeles County Federation of Labor and co-chair of the “Raise the Wage” campaign,?has requested that unions be exempted from the higher wages for their members.

Hicks released a statement praising the City Council’s decision on May 19:

“We are one step closer to making history in Los Angeles by adopting a comprehensive minimum wage policy that will change the lives of hundreds of thousands of hard-working Angelenos. The City Council?s action today creates a path for workers to succeed and gives our economy the boost it needs to grow.”

But early last week, Hicks released another statement following his request for union exemption:

“With a collective bargaining agreement, a business owner and the employees negotiate an agreement that works for them both. The agreement allows each party to prioritize what is important to them.?This provision gives the parties the option, the freedom, to negotiate that agreement. And that is a good thing.”

The L.A. Times came out in full swing against the request, calling the request “stunning”?and “hypocrisy at its worst”:

“No, employers with a unionized workforce should not be allowed to pay less than Los Angeles’ proposed minimum wage. It’s stunning that after leading the fight for a $15 citywide minimum wage and vehemently opposing efforts to exempt restaurant workers, nonprofits and small businesses from the full wage hike, the Los Angeles County Federation of Labor is now lobbying for an exemption for employers with union contracts. That’s right ? labor leaders are advocating that an employer should have the right to pay union members less than the minimum wage.

“This is hypocrisy at its worst, and it plays into the cynical view that the federation is more interested in unionizing companies and boosting its rolls of dues-paying members than in helping poor workers.”

Diana Furchtgott-Roth, the director Economics21 at the Manhattan Institute, provided insight on why union would campaign aggressively for a minimum wage hike and then request to be exempted:

“Although the union-funded Raise the Wage campaigned so vociferously in favor of a $15.25 minimum wage, unions are seeking exemptions from the higher wages for their members. The exemption, or escape clause, would allow them greater strength in organizing workplaces. Unions can tell fast food chains, hotels, and hospitals that if they agree to union representation, their wage bill will be substantially lower. That will persuade employers to allow the unions to move in. …

“Once the higher minimum wage bill is signed into law, with the exemption for unions, then organizing becomes a win-win for employers and unions. Unions get initiation fees of about $50 per worker and a stream of dues totaling 2 percent to 4 percent of the workers? paychecks. Employers get a lower wage bill.

“The losers in this scheme are employees, who have to pay union dues out of their paychecks. Jobs become more scarce as wage levels rise and some less-skilled workers become unemployed.”

Originally published by CalWatchdog.com

L.A. Minimum Wage Hike: How Will Businesses React?

Photo courtesy of channone, flickr

Photo courtesy of channone, flickr

The Los Angeles City Council tentatively voted to increase the city?s minimum wage to $15 an hour by 2020. The business community opposed the move. How business will react is unclear but there was much discussion during the debate over issues such as?lost jobs and companies eyeing more business-friendly locations.

The wage increase is to be phased in over time, so the immediate impact may not be felt. But businesses ought to keep score when the effects hit so that officials will be cognizant of the consequences. If the wage increase does not cause economic disruptions and businesses do not actually leave Los Angeles, the business community?s credibility will suffer in the face of a mere exercise in rhetoric.

The vote to pass the minimum wage increase was 14 to 1. The council gets to vote once more on the measure after an ordinance is drafted by the city attorney, but the lopsided vote indicates there is no turning back. The council even set the wage above the recommended level offered by Mayor Eric Garcetti, who initially proposed an increase to $13.25 an hour.

The city council?s version contains an inflation clause and offers an extra year for small businesses and nonprofits to comply.

However, the business community does not consider?these?admissions enough. Ruben Gonzalez of the Los Angeles Chamber of Commerce said, ?There is simply not enough room, enough margin to absorb a 50 percent increase in labor costs over a short period of time.?

The chamber?s president and CEO Gary Toebben wrote to his members about the many small business owners who testified in various hearings on the measure. He wrote, ?They also talked about the likelihood that in order to provide a wage increase for some employees, they would have to reduce hours for others.?

Toebben noted wryly, ?Last week, there were banners hanging throughout City Hall celebrating Small Business Week. There are many small business owners in L.A. who don?t feel like the city is celebrating them today.?

Earlier on?the day of the vote, the Los Angeles County Business Federation (BizFed) released a survey on business conditions in the area. According to a release from BizFed, ?The city of Los Angeles stood out again as being cited most frequently by employers as unfriendly.? Santa Clarita and Glendale were ranked in the top 5 most business friendly cities,?which is notable because officials from those two cities are actively courting city of Los Angeles businesses in light of the proposed city of Los Angeles minimum wage increase.? (Author?s emphasis.)

So what will Los Angeles businesses do? Once the minimum wage law takes effect will there be jobs lost or hours cut? How many businesses move to a different location? Business credibility is on the line. Crying wolf and not acting will damage efforts to turn around what many decry as unfriendly business policies.

Originally published by CalWatchdog.com