LOS ANGELES - The Los Angeles City Council has finalized an emergency ordinance to require large grocery and pharmacy retailers to offer employees an additional $5 per hour in hazard pay amid the COVID-19 pandemic.
Council members last week approved the ordinance on a 14-1 vote -- but a unanimous vote was needed for passage on first reading. During the second reading, a dozen yes votes were required for approval and the measure was again approved 14-1, with Councilman John Lee reaffirming his dissent.
The $5 hazard pay will 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 will 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.
"Fair compensation is the very least that our grocery store workers deserve after all they have done for us,'' Council President Nury Martinez, who introduced the original motion with Councilman Mitch O'Farrell, said during the council's discussion of the ordinance last week.
"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,'' she said. "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
The Los Angeles County Board of Supervisors adopted an urgency ordinance on Feb. 23 to require $5 additional pay for national grocery and drug retail employers in unincorporated areas of the county.
Long Beach also enacted a $4 hazard pay ordinance, which was challenged in court. Kroger announced last month that it would close two of its Long Beach stores -- a Ralphs location and a Food4Less store -- in response to the ordinance.
The California Grocers Association filed federal lawsuits against 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. A federal judge denied the association's bid to temporarily overturn the Long Beach ordinance.
Los Angeles' CLA determined that potential economic impacts of the ordinance include temporary increases of labor costs as a percentage of the company's sales, potential higher prices for consumers, potentially delayed store openings, renovations and wage increases or promotions for employees, potential pressure on struggling stores that could lead to stores closing and reduced hours for some employees.
However, the 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.
"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 before the measure's first reading. "I want to underscore that it is a matter of justice.''
O'Farrell agreed, saying, "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. 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.''