HomeMy WebLinkAboutHERO PAY (ITEM 12) PROPOSED " HERO PAY "
ORDINANCE/ RESOLUTION
TUSTIN CITY COUNCIL
APRIL 20, 2021
SUMMARY
• CONSIDER FIRST READING OF AN ORDINANCE MANDATING A TEMPORARY $4
INCREASE IN HOURLY WAGES FOR GROCERY AND RETAIL DRUG STORE WORKERS
FOR AFOUR-MONTH PERIOD
• OR ALTERNATIVELY, ADOPT A RESOLUTION ENCOURAGING STORES TO ESTABLISH A
TEMPORARY INCREASE IN WAGES.
• THE MAIN DIFFERENCES BETWEEN THE ORDINANCE AND THE RESOLUTION ARE:
• REQUIREMENTS/ENCOURAGEMENT
• TIMING: 2ND READING PLUS 30 DAYS/IMMEDIATE UPON ADOPTION
BACKGROUND
• GROCERY STORES AND RETAIL DRUG STORES HAVE REMAINED OPEN
SINCE THE COVID- 19 PANDEMIC BEGAN
• AS A RESULT, THE PUBLIC CONTINUES TO BE SUPPLIED WITH FOOD,
MEDICINE, AND OTHER ESSENTIAL GOODS.
• WORKERS AT THESE STORES ARE UNABLE TO TELECOMMUTE OR
WORK REMOTELY.
• GROCERY WORKERS ARE IN CLOSE CONTACT WITH MEMBERS OF
THE PUBLIC, OFTEN WITHIN SIX FEET
OTHER " HERO PAY" ORDINANCES
• MOST IN THIS REGION APPLY TO RETAILERS THAT:
• EMPLOY AT LEAST A FEW HUNDRED EMPLOYEES NATIONALLY AND
• MORE THAN FIFTEEN EMPLOYEES PER STORE WITHIN CITY LIMIT
• EACH ORDINANCE REQUIRES COVERED ENTITIES TO:
• PROVIDE ADDITIONAL PAY OF $4 PER HOUR WORKED
• FOR A PERIOD OF 120 DAYS.
THE PROPOSED ORDINANCE/ RESO
• APPLIES TO RETAIL ESTABLISHMENTS THAT:
• EMPLOY AT LEAST 15 EMPLOYEES IN TUSTIN .. .AND
• EMPLOY 300 OR MORE EMPLOYEES NATIONALLY
AND . . .
THE PROPOSED ORDINANCE/ RESO
• APPLIES TO RETAIL ESTABLISHMENTS THAT:
• DEVOTES 70% OR MORE OF ITS SALES FLOOR AREA TO RETAILING
A GENERAL RANGE OF FOOD PRODUCTS, OR
• RECEIVES 70% OR MORE REVENUE FROM RETAILING A GENERAL
RANGE OF FOOD PRODUCTS, OR
• IS A RETAIL PHARMACY THAT SELLS PRESCRIPTION AND
NONPRESCRIPTION MEDICINES AS WELL AS MISCELLANEOUS ITEMS
THE PROPOSED ORDINANCE/ RESO
• IF ADOPTED, IT WOULD REQUIRE/ENCOURAGE EXTRA
COMPENSATION TO APPROXIMATELY :
• 80O GROCERY STORE WORKERS AND
• 50 RETAIL DRUG STORE WORKERS .
CONSIDERATIONS
• ARGUMENTS THAT HAVE BEEN OFFERED IN FAVOR :
• NEEDED TO ADDRESS THE DISPARITY IN WAGES BETWEEN
GROCERY WORKERS AND OTHER ESSENTIAL WORKERS, LIKE
MEDICAL PROFESSIONALS .
• NEEDED TO PROVIDE INCENTIVES TO EXPERIENCED STORE
WORKERS TO REMAIN AT THEIR JOBS TO ENSURE CONTINUITY OF
SERVICES TO THE PUBLIC DURING THE PANDEMIC .
CONSIDERATIONS
• ARGUMENTS THAT HAVE BEEN OFFERED IN OPPOSITION :
• RISK OF LITIGATION CHALLENGING THE ORDINANCE
• OTHER GROUPS OF EMPLOYEES WHO ARE REGULARLY
EXPOSED TO SIMILAR RISKS ARE NOT COVERED BY THE
ORDINANCE
• POSSIBILITY OF STORES BEING CLOSED
CONSIDERATIONS
• THE CALIFORNIA GROCERS ASSOCIATION (CGA)
OPPOSES " HERO PAY" ORDINANCES
• CGA HAS FILED SEVERAL LAWSUITS CHALLENGING OTHER
CITIES ' ORDINANCES
CITIES THAT HAVE ADOPTED " HERO PAY"
ORDINANCES AND CHALLENGED IN COURT
• IRVINE 0 MONTEBELLO • BERKELEY
• SANTA ANA 0 COACHELLA e DALY CIN
• COSTA MESA 0 WEST HOLLYWOOD • SAN LEANDRO
• LONG BEACH • SANTA MONICA • OAKLAND
• POMONA • LOS ANGELES • SAN JOSE
• BUENA PARK
CONSIDERATIONS
• SOME GROCERS HAVE CLOSED STORE LOCATIONS CITING
THE INCREASED COSTS FROM " HERO PAY" ORDINANCES
ON BORDERLINE STORES . SUCH CLOSURES INCLUDE:
• TWO STORES IN LONG BEACH
• THREE IN LOS ANGELES
• TWO IN SEATTLE
ALTERNATIVES
• THE COUNCIL HAS AT LEAST THREE OPTIONS :
• CONDUCT FIRST READING OF PROPOSED ORDINANCE 1513 TO
REQUIRE THE PAY INCREASES; OR
• ADOPT PROPOSED RESOLUTION 21 -30 TO ENCOURAGE BUT NOT
REQUIRE SUCH PAY INCREASES; OR
• TAKE NO ACTION .
QUESTIONS ?