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Wage Increases in Fire - Los Angeles Business Journal

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A union-backed march in nine cities in Los Angeles County to force private sector health care providers to pay dramatically higher minimum wages was met with backlash in the cities of Los Angeles and Downey last week.

A hospital-funded referendum campaign will freeze the recently passed minimum wage hike for health insurance in these two cities on Aug. 10, doubling the amount needed to hold a popular vote on the issue. He said he had collected signatures.

Assuming these signatures are sufficiently ratified, there will be a popular vote, but probably not until 2024. That would give health care providers time to fight back, or at least a longer reprieve from paying higher wages. Otherwise, they were considering paying him 67% more than the minimum wage early next month.

At issue is a campaign by the Service Employees International Union – Health Care Workers West to encourage private-sector healthcare providers, not public-sector providers, to raise the hourly minimum wage to $25 from the current $15. We are reaching out to nine local cities. .

The counterattack, which is largely funded by the California Association of Hospitals and Health Systems, is alarmed by the high numbers. A large increase in the minimum wage could be catastrophic for some, they said, because a lot of it is salaries.

When asked if some medical facilities in Long Beach could realistically close as a result of the minimum wage increase, John Edmund, spokesman for the Long Beach Area Chamber of Commerce, said: said. Absolutely… that’s exactly what we’re worried about,” he said, adding that hospitals and other providers were weakening and still recovering from Covid-related losses.

The Chamber of Commerce board voted against the move to raise the healthcare minimum wage, but the Long Beach City Council voted in favor earlier this month and is expected to vote in favor later this week.

SEIU-UHWW, which represents nearly 100,000 workers in California, argued that healthcare workers need a major boost as they navigate the dangerous Covid times.

The majority of workers are exempt from this ordinance.
Becky Warren
Prohibition of unequal pay
Countermeasure campaign

“They’ve been through hell,” union spokesperson Lenny Saldana said. She also said higher wages would help attract workers and alleviate the hospital’s staff shortage.

Mr Saldana added that the union was “genuinely appalled” by the hospital association’s move against wage increases. “Billionaire hospital executives … are cutting caregiver salaries.”

When told that the hospital association had no intention of cutting salaries, only halting the sudden and drastic increase in the minimum wage, she said it was “the same as a cut” and that the money workers expected to get. He said it was because he wanted to steal the

Target city

The union has reached out to nine cities so far. In addition to Los Angeles and Downey, where city councils have approved union requests to raise minimum wages for private facilities, Monterrey Park has also previously approved a pay hike for healthcare, and Long Beach is set to vote on it this week.Inglewood and Duarte chose to put the bill to a popular vote. The issue is being discussed in Culver City, Baldwin Park and Lynnwood.

Minimum wage ordinances passed in Los Angeles and Long Beach not only cover traditional health care workers such as nurses and pharmacists, but also employees such as janitors, security guards, maintenance workers and cafeteria workers. .

The Ordinance also includes privately owned clinics, acute psychiatric hospitals, dialysis clinics, psychiatric facilities, and other similar facilities associated with private hospitals, as well as hospitals owned by Kaiser Permanente and Dignity Health. It also applies to businesses.

A trade union spokesperson explained that the movement is only aimed at private sector facilities. This is because cities cannot legally tell counties or other governments how much to pay workers.

However, the point is grasped by the hospital association. Many health facilities are owned by counties or other governments, so the ordinance affects only a small number of workers. According to the association, a Berkeley Research Group report released last month found that 65% of health care workers in the target cities would be exempt from the new pay scale.

Not only is it inherently unfair, but the ordinance can create a sort of two-tier system in which private facilities bear higher costs and may be forced to outsource less profitable services to public facilities. there is. Low wages can make it difficult to attract and retain workers.

“The vast majority of workers are excluded from this ordinance, unfairly creating winners and losers,” said Becky Warren, spokesperson for the Campaign Against Unequal Pay in Los Angeles.

thin margins

According to a report commissioned by the City of Long Beach and conducted by the Los Angeles Economic Development Corporation, the average operating margin for industry in Long Beach is 19.8%. However, the average margin for medical services in that city is only 5.5%.

“These leave little room for businesses to absorb increased costs,” the report said.
At the same time, healthcare facilities face higher labor costs. Long Beach’s industry has an average labor intensity of 36% of total production, while all healthcare industries in the city average 56%.
Therefore, an increase in the number of the latter can wipe out the number of the former.

The report included complementary testimony from an unnamed representative of the Ocean View Psychiatric Facility in Long Beach. he wrote: The difficulties we are already facing through the Covid-19 pandemic.

“The safety net that private health facilities provide to our communities will cease to function, and the public health system will bear the financial and medical burden.”

Rather than pass an ordinance, I ask the city council to put a bill to a vote “to allow Long Beach residents to have a voice on issues that could significantly impact their access to critical health care services.” I asked.