City Council Meeting 7-10-01                                                                       Santa Monica, California

ORDINANCE NUMBER _____

            (City Council Series)

  

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY

OF SANTA MONICA ADDING CHAPTER 4.65 TO THE SANTA

MONICA MUNICIPAL CODE CREATING MINIMUM WAGE REQUIREMENTS

APPLICABLE TO BUSINESSES IN THE COASTAL ZONE AND

EXTENDED DOWNTOWN CORE WITH GROSS RECEIPTS OVER

$5,000,000 AND TO THE CITY AND ITS SERVICE CONTRACTORS

  

WHEREAS, the public welfare requires wages and benefits sufficient to ensure a decent and healthy life for workers and their families; and

WHEREAS, many Santa Monica employers pay wages so low as to imperil the public welfare; and

WHEREAS, many Santa Monica workers earn wages insufficient to support themselves and their families; and

WHEREAS, many Santa Monica workers receive no health care benefits and therefore cannot protect their own health and the health of their families; and

WHEREAS, many Santa Monica workers cannot participate in civic life or pursue educational, cultural and recreational opportunities because they must work such long hours to meet their households= most basic needs; and

WHEREAS, workers who do not receive adequate wages must rely upon federal, state and local public assistance and social services funded by taxpayers and may never escape poverty; and

WHEREAS, workers who do not receive health care benefits may be unable to maintain their own health or the health of their children, may be forced to utilize publicly- funded health and emergency care services, and may unintentionally imperil the health of others; and

WHEREAS, workers who do not have sufficient income and time off work to participate in the civic affairs and to pursue educational, cultural and recreational opportunities may become alienated from their communities, their states and their nation; and

WHEREAS, minimum wage laws promote the general welfare by ensuring that workers can support and care for their families through their own efforts and without governmental intervention; and

WHEREAS, creating decent job opportunities through minimum wage and benefit laws is a better way to protect individuals and families than public assistance because the availability of decent job opportunities fosters independence, self-reliance and family unity; and

WHEREAS, laws mandating or encouraging the provision of health care benefits to workers promote the general welfare by minimizing health risks to the general population and reducing the cost of emergency and other health care to the taxpayers; and

WHEREAS, minimum wage and benefit laws also assure workers the means and leisure to participate in civic life and pursue educational and cultural opportunities and thereby strengthen the fabric of our society; and

WHEREAS, minimum wage and benefit laws also benefit employers and the economy as a whole by improving employee performance, reducing employee turnover, lowering absenteeism, and thereby improving productivity and the quality of the services provided by employees; and

WHEREAS, in recognition of these realities, the federal government mandates the payment of a minimum wage; and

WHEREAS, in recognition of the fact that the cost of living and other circumstances vary substantially through the United States, federal law explicitly authorizes states and municipalities to set more stringent wage standards than those established federally; and

WHEREAS, the State of California has exercised its power to set a minimum wage higher than the minimum set by federal law in part because the cost of living in California is higher than in most states; and

WHEREAS, the California Legislature has recognized that localities may need to set more stringent wage standards than those set by state law and has therefore specifically authorized the adoption of such standards in Labor Code Section 1205; and

WHEREAS, in Opinion Number 89-502, the California Attorney General has recognized the power of local governments to set wage requirements higher than those set by state law; and

WHEREAS, the federal minimum wage has declined steadily in real dollars for two decades; and

WHEREAS, the California minimum wage has also declined in real dollars; and

WHEREAS, the California minimum wage is inadequate to meet the needs of workers in the Los Angeles region where the cost of living is much higher than in most parts of the state; and

WHEREAS, housing costs in the region are particularly high relative to most parts of California, and low-income workers must therefore spend a disproportionate percentage of their income sheltering themselves and their families; and

WHEREAS, disproportionately high housing costs force workers to locate far from their jobs and spend long hours traveling to and from work; and

WHEREAS, the taxpayers of the Los Angeles region must pay the cost of meeting workers= needs through the provision of social services because the state minimum wage is not adequate to meet those needs; and

WHEREAS, a minimum wage standard which condemns a full-time worker=s family to abject poverty is simply inadequate to achieve the long-recognized and salutary goals of the minimum wage laws; and

WHEREAS, the inadequacy of the state minimum wage is particularly detrimental to the public welfare in Santa Monica where the cost of living is very high and where thousands of workers labor long hours at very low-paying jobs; and

WHEREAS, the highest concentration of low-income workers in Santa Monica is in the coastal zone and the extended downtown core; and

WHEREAS, this same area is home to some of the City=s largest and most profitable businesses, including luxury hotels, gourmet restaurants and large, national retailers which can afford to pay their employees decent wages and can pass the cost of paying increased wages to consumers; and

WHEREAS, most workers in this area are heads of household who bear primary responsibility for supporting their families; and

WHEREAS, eighty per cent of these workers have incomes inadequate to meet their families= basic needs; and

WHEREAS, the vast majority of these workers have no private health insurance; and

WHEREAS, tourists staying in the hotels in this area may pay more than $400.00 per night for their rooms, but the workers changing their bedding and serving their food cannot support their own families; and

WHEREAS, businesses in this area have reaped the benefits of various City policies and investments; and

WHEREAS, the City has actively improved this area through capital investments, operating expenditures, the promotion of tourism and the adoption of policies which restrict growth and limit competition among certain businesses; and

WHEREAS, these investments, expenditures and policies have fostered huge profits for some businesses in the area which employ large numbers of low-wage workers; and

WHEREAS, the City Council wishes to adopt a local requirement to effectuate the purposes of the federal and state minimum wage law, to address the needs of workers, and to promote the public welfare; and

WHEREAS, increasing the wages of low-wage workers will help achieve Santa Monica=s sustainable city goals by helping low-wage workers live closer to work, reducing commute distances, and facilitating use of public transit; and

WHEREAS, the City Council also wishes to protect local businesses and their employees by ensuring that no business suffers economic hardship so severe as to render it nonviable as a result of this ordinance; and

WHEREAS, the Council wishes to take all possible action to address the problems caused by inadequate wages and benefits, and Council therefore intends that the severance doctrine shall be liberally applied to effectuate the policy served by this law,

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA MONICA DOES HEREBY ORDAIN AS FOLLOWS:

SECTION 1. Chapter 4.65 is hereby added to the Santa Monica Municipal Code to read as follows:

CHAPTER 4.65

LIVING WAGE

Section 4.65.010. Definitions.

Coastal Zone. That area bounded by the Pacific Ocean on the west, by the City border on the south, on the north by the San Vicente Boulevard centerline from the eastern border of the City to its intersection with the norther City border and along the City border west to the Pacific Ocean, and on the east by the Lincoln Boulevard centerline south of Pico Boulevard and Fourth Street north of Pico Boulevard. Properties adjacent to the east side of Fourth Street between Pico Boulevard and Colorado Boulevard are included within the area defined by this subsection; otherwise the Fourth Street boundary shall be at the centerline.

Extended Downtown Core. That area bounded by Ocean Avenue on the west, Wilshire Boulevard on the north, Fifth Street on the east, and Colorado Boulevard on the south. Properties on both sides of the boundary streets shall be included within this definition.

Employee. Any person who does not actually work as a manager, supervisor, or confidential employee, and who is not required to possess an occupational license.

            Gross Receipts Threshold. Gross receipts over $5 million per year which amount shall be adjusted annually each July 1st, beginning in 2003 by an amount corresponding to the previous year=s change in the Consumer Price Index for Urban Wage Earners and Clerical Workers in Los Angeles County.

Health Benefit. A payment towards the provision of health care benefits for Employees and their dependents in the amount of $1.75 per hour in the first year that this Chapter is in effect, $2.50 per hour in the second year that this Chapter is in effect, and thereafter adjusted annually each July 1^st, beginning in 2004, by an amount corresponding to the previous year=s change in the Consumer Price Index for Urban Wage Earners and Clerical Workers in Los Angeles County.

Minimum Wage. A wage payment at an initial hourly rate of $10.50 per hour with Health Benefits or $12.25 per hour without Health Benefits. These rates shall be adjusted annually each July 1^st, beginning in 2003, by an amount corresponding to the previous year=s change in the Consumer Price Index for Urban Wage Earners and Clerical Workers in Los Angeles County.

Section 4.65.020. Minimum Wage Payment Requirements.

The Minimum Wage required by this Chapter shall be paid by:

(a) the City of Santa Monica to all workers employed by the City;

(b) any contractor or subcontractor working for the City of Santa Monica on a service contract to workers performing the work on that contract;

(c) any private person or private corporation doing business at a location in the Coastal Zone or Extended Downtown Core with gross receipts over the Gross Receipts Threshold at that location for the previous two years to Employees working at that location. The gross receipts of a contractor, subcontractor, lessee or sublessee received at that location for performing part of the business activities of the private person or corporation shall be included in determining whether the Gross Receipts Threshold is exceeded; and

(d) any contractor, subcontractor, lessee or sublessee performing part of the business activities of a private person or private corporation described in subsection (c) to Employees doing that work during at least half of their work time.

Section 4.65.030. Exemption for Severe Economic Hardship.

An employer who contends that compliance with this Chapter would constitute a severe economic hardship may apply to the City Manager for a waiver applicable to all or part of the employer=s work force. Criteria for determining hardship shall include whether: (a) compliance with the requirements of this Chapter would render the employer=s business nonviable; (b) the employer=s business depends for its viability upon young people and other first-time workers who are employed on a seasonal basis; and (c) whether granting a waiver would otherwise advance the policies underlying this Chapter. The City Manager shall promulgate an Administrative Instruction establishing specific criteria applicable to and procedures for processing hardship applications. Said Administrative Instruction shall set forth information to be included on the hardship application, procedures for filing and processing applications, and procedures for administrative review by a City hearing examiner whose final decision shall be subject to judicial review.

Section 4.65.040. Prohibitions Against Retaliation and Circumvention.

It shall be unlawful for any employer or employer=s agent or representative to take any action against an individual in retaliation for the exercise of rights under this Chapter. This Section shall also apply to any individual working in or for the City who mistakenly, but in good faith, alleges noncompliance with this Chapter.

Taking adverse action against an individual within sixty (60) days of the individual=s assertion of rights shall raise a rebuttable presumption of having done so in retaliation for the assertion of rights.

Additionally, it shall be unlawful for any employer to intentionally circumvent the requirements of this Chapter by contracting portions of its operation or leasing portions of its property.

Section 4.65.050. Remedies.

(a) Criminal Penalty. Any person who is convicted of violating this Chapter shall be guilty of a misdemeanor and upon conviction shall be punished by a fine of not greater than five hundred dollars or by imprisonment in the county jail for not more than six months, or by both such fine and imprisonment.

(b) Civil Action. Any person, including the City, may enforce the provisions of this Chapter by means of a civil action for injunctive and monetary relief. The burden of proof in such cases shall be preponderance of the evidence. Any person who violates or aids or incites another person to violate the provisions of this Chapter is liable for each and every such offense for the actual damages suffered by any aggrieved party or for statutory damages in the sum of five hundred dollars, whichever is greater, and shall be liable for such attorney's fees and costs as may be determined by the court in addition thereto. The court may also award punitive damages to any plaintiff, including the City, in a proper case as defined by Civil Code Section 3294. The burden of proof for purposes of punitive damages shall be clear and convincing evidence.

(c) Administrative Complaint. Any Employee claiming violation of this Chapter may file an administrative complaint with the City Manager or his or her designee who shall investigate the complaint and render a determination on it. If the City Manager or Manager=s designee concludes that a violation has occurred, he or she may issue orders to the employer appropriate to effectuate the complaining Employees= rights, including, but not limited to, back pay and reinstatement. If the employer refuses to comply with such orders, the City Manager may revoke the employer=s business license. The City Manager=s determination shall be appealable to a hearing officer who shall conduct an evidentiary hearing and issue a written decision thereon. The hearing officer=s decision shall be reviewable in court.

(d) Nonexclusive Remedies and Penalties. The remedies provided in this Section are not exclusive, and nothing in this Chapter shall preclude any person from seeking any other remedies, penalties or relief provided by law.

Section 4.65.060. Supercession by Collective Bargaining Agreement.

All of the provisions of this Chapter, or any part thereof, may be waived in a bona fide collective bargaining agreement, but only if the waiver is explicitly set forth in such agreement in clear and unambiguous terms. Unilateral implementation of terms and conditions of employment by either party to a collective bargaining relationship shall not constitute, or be permitted as, a waiver of all or any part of the provisions of this Chapter.

Section 4.65.070. Effective Date and Implementation.

Employers= obligations under Section 4.65.020 shall be effective as of July 1, 2002.

SECTION 2. Any provision of the Santa Monica Municipal Code or appendices thereto inconsistent with the provisions of this Ordinance, to the extent of such inconsistencies and no further, is hereby repealed or modified to that extent necessary to effect the provisions of this Ordinance.

SECTION 3. If any section, subsection, sentence, clause, or phrase of this Ordinance is for any reason held to be invalid or unconstitutional by a decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this Ordinance. The City Council hereby declares that it would have passed this Ordinance and each and every section, subsection, sentence, clause, or phrase not declared invalid or unconstitutional without regard to whether any portion of the ordinance would be subsequently declared invalid or unconstitutional.

SECTION 4. The Mayor shall sign and the City Clerk shall attest to the passage of this Ordinance. The City Clerk shall cause the same to be published once in the official newspaper within 15 days after its adoption. Except as provided in Section 4.65.070, this Ordinance shall become effective 30 days from its adoption.

APPROVED AS TO FORM:

 _______________________
MARSHA JONES MOUTRIE
City Attorney

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