Businesses Drop Referendum Effort to Overturn LAX Hotel Living Wage Law

Decision Comes After Poll Shows Overwhelming Public Support for Wage Legislation; Council Will Enact New Ordinance to Address Business Concerns and Revitalize Century Corridor.

Los Angeles — Business leaders have dropped an effort to use a ballot referendum to overturn a landmark law that extends the city’s living wage ordinance to thousands of workers at hotels near Los Angeles International Airport.

The decision comes after the release of a poll earlier this week showing overwhelming public support for the Century Boulevard living wage law.

As part of an agreement reached between the Chamber of Commerce, the Los Angeles Hotel Association and supporters of the living wage, Mayor Antonio Villaraigosa and members of the City Council agreed to rescind the original ordinance and enact a new law that will raise wages for Century Boulevard hotel workers while providing certain assurances to business leaders.

The new law will apply the city’s existing living wage rate of $10.64 an hour ($9.39 for those with employer-provided health benefits) to 3,500 hotel workers in 13 hotels along Century Boulevard. The wage standard will be phased in with three steps. The new law also creates an enhancement zone that will pave the way for revitalization of the Century Corridor, establishes procedural guidelines for future Council consideration of living wage legislation and mandates studies on how the living wage law affects business and workers.

This new law will help lift thousands of hotel workers out of poverty while also addressing the concerns of business leaders,” said Vivian Rothstein, Deputy Director of the Los Angeles Alliance for a New Economy, which helped lead the effort to pass extend the living wage law to LAX hotel workers. “From the beginning of this campaign we have been seeking a comprehensive solution to the problems of poverty and disinvestment that have plagued this part of Los Angeles. We are pleased that business leaders have now joined with us to transform the gateway to Los Angeles into a gateway to prosperity.”

Living wage supporters emphasized that the campaign to improve conditions for LAX hotel workers was far from over, noting that even with a wage increase many workers cannot afford health insurance and still face difficult working conditions.

This is only the first step in helping lift thousands of hard-working men and women into the middle class,” said Tom Johnstone, Assistant Superintendent of the Lennox School District, one of hundreds of community leaders across the city who have joined in the campaign to raise standards for LAX hotel workers. “We will continue to support these workers in their effort to provide a better life to their children and achieve the American dream.”

Hotel workers on Century Boulevard work full time, yet many of them still live in poverty. Hotel workers in the LAX/PCH submarket earn 20% less than their counterparts in downtown L.A. Average annual earnings for LAX/PCH workers is $20,328 – barely above the federal $20,000 federal poverty threshold for a family of four. Some workers qualify for multiple government assistance programs.

The nearby communities of Lennox, Inglewood and Hawthorne, where a large number of these workers live, suffer high rates of poverty, crime and overcrowding. One in four residents in these communities lives below the federal poverty line, a measure of extreme poverty, while more than 40% of children come from poor households. Median household income is 25% lower than in L.A. County as a whole.

It is my dream to give my children a better life,” said Maria Luisa Avalos, a housekeeper at the Hilton LAX. “This is what every mother hopes for, and a living wage will help me fulfill this dream. But our struggle to achieve our dreams is not over.”

For the past year, a coalition of community, civic and faith leaders has engaged in an effort to address conditions for LAX hotel workers and nearby communities. In February the coalition presented thousands of signatures to City Council asking for a comprehensive plan for the area. In April, a blue ribbon commission headed by former Councilmember Ruth Galanter released a report calling for a major effort by city, industry and community leaders to address conditions for workers, communities and the hotel industry near LAX.

On September 28, thousands of people marched and hundreds were arrested in the largest nonviolent civil disobedience ever held in L.A. And in December, community leaders from across the city supported hotel workers during a seven-day fast, joining them for daily actions on Century Boulevard.

The City Council passed the original living wage law for Century hotel workers in November 2006. In December, hotels and other businesses spent nearly $1 million to collect enough signatures to qualify a ballot referendum on the ordinance.

Business groups had reportedly planned to spend several million dollars to convince voters to repeal the living wage law. But a poll released on Monday showed that 74% of voters supported the law.

It is clear that the public cares deeply about working poverty and believes that city leaders have a responsibility to ensure that people who work hard can support themselves and their families in dignity,” said Rothstein. “The Mayor and City Council have shown tremendous leadership on this issue, and residents of Los Angeles will continue to support them in finding solutions that help create better jobs and rebuild our middle class.”