Irvine gets rid of its living wage

Caitlin Esch Jul 16, 2015
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Irvine gets rid of its living wage

Caitlin Esch Jul 16, 2015
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The city of Los Angeles has a new minimum wage. It’ll go up to $15 an hour over the next five years. But just 40 miles south of L.A.,  the city of Irvine has taken a different approach. The city council voted recently to repeal its local living wage ordinance that applies to contractors providing services like street cleaning, security and landscaping.

Irvine is a relatively affluent suburb in Orange County, where the median household income is more than $90,000 a year. If you drive to city hall, you’ll see a meticulously maintained lawn, shapely hedges and beautiful flowers. That’s partly thanks to gardeners like Manuel Nieto. He says he’s been working in Irvine’s fields and parks for seven years, and he earns $12.30 an hour — well above the state minimum wage of $9 an hour.

Nieto’s employer has multimillion-dollar contracts with the city stipulating it pays workers at least $10.82 an hour with benefits, more without. The living wage ordinance was passed back in 2007 when Democrats had control of the local city council. Larry Agran served on the council then as a Democrat.

“I felt we really were doing something pioneering and important, and that we were changing people’s lives for the better,” he says.

Today, Agran is no longer in office and the city council is under Republican control. Councilman Jeff Lalloway voted in the overwhelming majority to repeal the living wage. At a city council meeting, Lalloway said the living wage isn’t enough to live off of anyway. “It’s a feel-good wage,” he says.

Lalloway says the living wage is an unfair burden on tax payers, and it’s also a philosophical issue.

“We should all be seeking ways to have our economy grow,” he says. “Businesses can still pay their employees whatever they like, without having us to mandate what that is.”

How will this play out? 

“There are very few cases that I’m aware of in modern history of either living wages or minimum wages being repealed,” says David Neumark, an economist at the University of California, Irvine. “My guess is these companies will be able to pay slightly lower wages. They’ll probably have somewhat more employees — somewhat more jobs, at somewhat lower wages.”

The new wage floor — the state’s minimum of $9 an hour — will take effect as current contracts expire.

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