In deal with business leaders, $30 minimum wage for L.A. hotel and airport workers will be delayed
A $30 minimum wage for hotel and airport workers will be delayed after Los Angeles elected officials persuaded a group of business leaders to drop a ballot measure that would have devastated the city budget.
On Tuesday, the City Council approved the 18-month delay, which will postpone the wage increase until after the 2028 Olympics and fend off the business-backed initiative to eliminate the gross receipts tax, which is the city’s second-largest revenue stream.
The minimum wage will still increase to $25 in July and continue in increments until reaching $30 in January 2030.
Because the 11 to 4 vote was not unanimous, the new pay schedule will head to a second vote next week. Councilmembers Eunisses Hernandez, Ysabel Jurado, Nithya Raman and Hugo Soto-Martínez cast the “no” votes.
In May 2025, the council approved a proposal that would have increased the minimum wage to $30 in July 2028 and also raised an hourly payment for healthcare coverage.
In response, a coalition of airline and hotel businesses gathered enough signatures to place a measure on the Nov. 3 ballot that took aim at the city’s gross receipts tax, which is imposed on a vast array of businesses, including entertainment companies, child-care providers, law firms, accountants, healthcare businesses, nightclubs and many others.
If approved by voters, the measure would have stripped $740 million from the city’s general fund over the first year, according to city officials, and over five years would have amounted to a $860 million loss annually on average.
City officials, hotel and airport businesses and labor unions had been in continuous negotiations since last Wednesday, when the council narrowly approved an initial postponement of the wage increase to allow time to reach an agreement. The business coalition agreed to withdraw the measure if the council permanently approved the delay.
In addition to delaying the $30 minimum wage, the council on Tuesday pushed back the hourly healthcare payment to start at $8.15 an hour for airport workers in July 2027 and $4.25 for hotel workers July 1 of this year.
The council also voted to set up a committee to study possible changes to the business tax structure.
“Imposing wages and benefits without bringing business to the table is not reasonable,” said Nella McOsker, president and CEO of the downtown business group Central City Assn., at the council meeting. “It is reasonable to ask us to partner together to be on the other side of the table and negotiate, but it is not OK to do so without that process.”
Kurt Petersen, president of Unite Here Local 11, which represents the hotel workers, accused city officials of giving “into blackmail.”
“They now have a playbook. The next time workers win something, they’ll threaten to blow up the city,” Petersen said of the business coalition. “It’s a bad day for workers.”
Council President Marqueece Harris-Dawson described the process as painful but nearing a conclusion.
“I think we walked away from the negotiating table, like many negotiating tables, where no one was happy about the outcome, but everybody came away better than when we started off,” he said.
Shortly before the council vote, Mayor Karen Bass issued a statement that said she was called in by both business and labor leaders to close the deal.
She called the proposed repeal of the gross receipts tax “an existential threat to the city budget and the services it supports,” including street repairs, public safety and efforts to clean the city.
“This agreement ensures workers are paid fairly and that businesses that create jobs can continue serving LA and hiring Angelenos,” Bass said.
On Tuesday, the council chamber was filled with union workers in red, purple and yellow shirts.
Laura Esquivel, a janitor at Los Angeles International Airport, expressed frustration that council members were not standing by their earlier commitment.
“We’re sick and tired of being exploited. Some members of the council that are here, now we know, do not stand with workers,” Esquivel said. “We are not giving up, we will continue to fight and we’ll be back here in 2028.”
Before voting against the delay, Soto-Martínez, a former Unite Here organizer, called it sad and enraging.
“I cannot support anything that is going to take away money from workers,” he said.
Councilmember Imelda Padilla, who spoke in Spanish, was critical of the way the negotiations unfolded.
“If this thing about the gross tax receipts passes, we don’t have a city,” Padilla said. “The business community has us by our necks.”
She said workers deserve the wage increase, though she voted for the delay.
“Next time, let’s negotiate, and let’s negotiate well,” she said.
Times staff writer Suhauna Hussain contributed to this report.
