Foodservice Equipment Reports

Organizers March On McD’s While L.A. Raises Minimum Wage To $15 An Hour

The Los Angeles City Council voted May 19 to increase the city's minimum wage from $9 to $15 an hour by 2020. The action gradually will increase the guaranteed hourly wage from $9 in the country's second-largest city, where more than 40% of the workforce earns less than the hourly wage. Although the hourly wage varies, similar measures have been enacted in Chicago, San Francisco and Seattle.

The first increase, to $10.50 an hour, will come July 1, 2016, followed by annual steps until July 2020, when the minimum wage will stand at $15 an hour.

Organized labor backed an increase but sought a wage of $15.25 an hour sooner than 2020. The local Chamber of Commerce opposed the move, saying businesses would have to cut staff, reduce hours or relocate. A survey by the L.A. County Business Federation of nearly 600 local business owners found that 35% said the wage boost would force them to cut jobs or workers’ hours. The same survey found that two-thirds believe business conditions will improve this year and 40% are planning to hire more workers—a 10% increase over 2014.

Meanwhile, McDonald Corp.’s Oak Brook, Ill., headquarters hosted demonstrations last week by protestors urging that hourly wages for the chain’s front-line workers be increased to $15 an hour. McDonald’s already plans to increase starting wages to $1 above the local minimum at 1,500 company-owned restaurants effective July 1. That increase affects more than 90,000 employees, about one-tenth of McDonald's restaurants across the country. Franchisees, which operate the majority of U.S. restaurants, make their own decisions on pay and benefits. Overall, about 750,000 employees work at company- and franchisee-owned McDonald's restaurants in the U.S.

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