Business & Economy

As some cities move toward a higher minimum wage, Irvine considers repealing living wage ordinance

Fast food workers, healthcare workers and their supporters shout slogans at a rally and march to demand an increase of the minimum wage to 15USD per hour, in Los Angeles on December 4, 2014. The nationwide protest is expected to reach 190 US cities.
Fast food workers, healthcare workers and their supporters shout slogans at a rally and march to demand an increase of the minimum wage to 15USD per hour, in Los Angeles on December 4, 2014. The nationwide protest is expected to reach 190 US cities.
ROBYN BECK/AFP/Getty Images

Bucking a national trend of cities raising minimum wage standards, the Irvine City Council will vote Tuesday to repeal its living wage ordinance that requires contractors who work for the city to pay all their employees minimum of a $10.82, even if they work outside the city limits.

The ordinance applies only to contractors who do $100,000 or more of work with the city every year. But city officials said the issue is cost.

"That raises the cost of our city contracts which is a burden to our taxpayers and it's really unfair," Irvine city council member Christina Shea said at a May 12 public meeting.

The ordinance requires business contractors to pay employees $10.82 an hour if they provide benefits like health care and paid time off. If no benefits were offered, the ordinance requires contractors to pay $13.34 an hour.

Council Member Beth Krom wants to keep the dinance. She said the extra dollar or two won't buy people expensive cars or houses - and given the minimum wage in California will increase by a dollar to $10 an hour in January, it's not going to be a big deal.

Irvine city council members voted to repeal the city's living wage ordinance earlier this month. They'll hold another meeting on the issue Tuesday night - a reading of the proposed repeal. It'll get a second reading and vote before becoming law.

"We appreciate your watchdog vigilance of our city budget, but we do not expect you to cut the wages of our lowest paid city workers in order to save each of us just a few dollars per year," Irvine resident Jane Olinger said at the May 12 meeting.

While many cities require contractors to meet certain requirements, which can include higher minimum wages, Irvine officials said other cities usually only make requirements regarding employees working on the city contract. Irvine's ordinance set a wage floor for all employees of the companies.

"That is what's very problematic," Shea said. "There's no other city that has this type of ordinance."

Irvine awards 15 contracts with a combined annual value of $18.6 million for custodial, landscape, maintenance, security, street sweeping, and transportation services, according to a city staff report. Three of those contracts expire at then end of next month.

City staff told the council they get about four bids per contract with the living wage ordinance in place.

The Los Angeles City Council voted last week to gradually raise the minimum wage to $15 an hour over the next five years for businesses that have more than 25 workers. An ordinance is being written for council’s approval.

It would raise the minimum wage to $10.50 in July 2016 for businesses with 25 or more employees. That’s six months after California’s statewide minimum wage goes up to $10 an hour.