LA City Council cuts new deal on Olympic wage after business tax revolt

Los Angeles’ bitter minimum wage fight hit a breaking point Tuesday as the City Council voted to slow the city’s march toward a minimum wage increase to $30-an-hour.

The council approved the revised plan in an 11–4 vote, delaying Los Angeles’ original goal of reaching a $30 hourly wage for hotel and airport workers by the 2028 Olympic Games.

The original proposal, backed by labor groups and union organizers, cleared the council in 2025 as part of a larger effort to boost wages ahead of the Olympics.

Under the revised schedule approved Tuesday, hotel and airport workers will see wages gradually increase to $25 an hour in 2026, $26.50 in 2027, $28.50 in 2028, and finally $30 an hour in 2029, with annual increases continuing afterward.

The city’s broader minimum wage is scheduled to rise to $18.42 an hour this July.

The revised agreement emerged after months of mounting tensions between labor organizations and business leaders, who argued they had little input during negotiations surrounding the original proposal.

Opponents — major airlines, hotel operators and business organizations — gathered enough signatures to force a business tax repeal measure onto the November ballot.

Officials warned that if voters approved the repeal measure, Los Angeles could lose roughly $860 million annually by eliminating one of the city’s largest revenue sources.

Chief Administrative Officer Matt Szabo warned the repeal would create an “unprecedented fiscal vacuum” and force “austerity measures far more severe than those seen during the Great Recession or during the COVID-19 pandemic.”

Szabo went even further, warning that thousands of layoffs, a hard hiring freeze, and major cuts to city services would become unavoidable if voters ultimately approved the repeal measure.

The move was designed to bring City Hall back to the negotiating table and slow the wage increase timeline.

“We tried to negotiate beforehand, tried to work with councilmembers, tried to work with labor,” Stuart Waldman, president of the Valley Industry and Commerce Association, told The California Post. “No one at any point said don’t raise the wage. We said let’s just do it in a smart way.”

The strategy ultimately paid off, with behind-the-scenes negotiations accelerating in the days leading up to Tuesday’s vote.

Mayor Karen Bass, who helped broker the final agreement, framed the compromise as an effort to balance higher wages for workers with broader economic concerns.

“This agreement ensures workers are paid fairly and that businesses that create jobs can continue serving LA and hiring Angelenos,” Bass said after the vote.

Business organizations praised the deal as a way to avoid broader uncertainty.

“Today is an important step forward for Los Angeles’ tourism and hospitality industries, and for the workers and businesses that create them,” said Nella McOsker, president and chief executive officer of the Central City Association.

“We reached an agreement that raises wages, expands healthcare benefits, but also recognizes the economic realities these industries are facing.”

Inside council chambers, however, tensions remained high.

One of the most contentious moments came when Councilmember Imelda Padilla pointed to the closure of the Airtel Plaza Hotel in Van Nuys as an example of economic pressures she said businesses in her district were already facing.

“I saw it myself,” Padilla told the audience. “Now my area is not going to have a hotel or restaurants.”

The remarks immediately drew boos from parts of the audience.

Padilla later talked about growing up in a household where her mother raised five children while earning minimum wage, arguing that workers deserve opportunities previous generations often lacked.

“My mother never earned more than minimum wage,” Padilla said. “With secondhand clothes, used shoes and a lot of discipline, she raised five children.”

Voting against the agreement were mayoral candidate Nithya Raman and councilmembers Hugo Soto-Martínez, Ysabel Jurado and Eunisses Hernandez.

Soto-Martínez, a former labor organizer with longstanding ties to Unite Here Local 11, delivered emotional remarks defending workers and warning against what labor supporters viewed as City Hall yielding to business pressure.

Raman joined the council’s progressive bloc in opposing the compromise agreement.

The measure now heads to Bass for final approval.

Business groups said they intend to withdraw the business tax repeal measure once the ordinance is signed.

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