L.A. union leader wants exemption from new $15/hr wage

L.A. union leader wants exemption from new $15/hr wage

minimum wage 2Just 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.”

3 comments

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  1. desmond
    desmond 31 May, 2015, 17:57

    Can we have a referendum to change the h in Rusty’s name to…..give me a D!

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  2. Bill Gore
    Bill Gore 1 June, 2015, 06:19

    WOW.
    Stunning. I am speechless…
    Rusty-you are a pro! Draft him IMMEDIATELY for Boxer’s Senate seat. America needs his talent in DC….

    Reply this comment
  3. John Galt
    John Galt 2 June, 2015, 07:21

    Interesting twist by unions to leverage their political muscle against non-union companies. Just one more example of the increasing burden on businesses in the west coast city-states of Los Angeles, San Francisco and Seattle after all set mandatory minimum wage levels exceeding state and federal levels. Unions might actually achieve this exemption over time as the coming economic downturn coupled with the much higher wages may drive some businesses to join with unions for exemption from the mandatory wage rates.

    On the other hand, higher than market minimum wages may inoculate each of these cities from the coming flood of illegal Mexican aliens into California since employers will face arrest if caught “profiting” by paying what would be much lower market driven wages caused by an oversupply of low skill labor. Will this drive the new illegal aliens to other cities and rural areas in California, and other western states? Who will benefit from an oversupply of cheap unskilled Mexican labor? In either case, one can assume that public school and welfare costs will skyrocket.

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