Business Groups Failed to Stop L.A.’s ‘Olympic Wage’ Increase. But the Battle’s Not Over.

The coalition of business groups trying to prevent minimum wage increases for tourism workers in Los Angeles has now failed twice. The Los Angeles City Council passed the package earlier this year despite the coalition’s dire predictions of economic ravages to follow, and this week, the groups’ petition to force a 2026 referendum on the law was denied because of an insufficient number of valid signatures.

Will the coalition keep coming?

“The Alliance is exploring all legal options,” Cydney Hargis, a spokesperson for the L.A. Alliance for Tourism, Jobs and Progress, told Capital & Main in an email.

The Los Angeles city clerk’s finding of insufficient petition signatures means that the so-called Olympic Wage kicks in immediately — about two months after it was supposed to begin. The minimum wage for hotel employees and workers at Los Angeles International Airport, which for many was set at $20.32 an hour, jumped to $22.50 and will increase each year until it reaches $30 in July 2028, when the Los Angeles Olympic Games are scheduled to commence.

Whether the business alliance can throw up more hurdles to wage increases between now and the Games is unknown. But a couple of things are clear: The group has more than enough funding to continue trying, and the union-led pushback against its efforts will be equally fierce. This is an expansive, high-stakes fight, with workers’ ability to afford life in L.A. resting in the balance.

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The wage law was years in the making. The measure was championed by UNITE HERE Local 11, which represents hotel workers, and the Service Employees International Union-United Service Workers West, which represents airport workers. It took years for it to gain momentum, and the hotel workers’ union had to throw considerable political weight behind it, including campaigning for City Council candidates supportive of the effort. (Disclosure: UNITE HERE and the SEIU are financial supporters of Capital & Main.)

The business coalition, on the other hand, came together quickly. The Alliance, as its name is often abbreviated, is being underwritten primarily by United Airlines, Delta Airlines and the powerful American Hotel and Lodging Association, the country’s largest hotel trade group.

Its deep corporate pockets haven’t prevented the Alliance from portraying the L.A. wage law as an assault on mom-and-pop operations. In a release this week, the group referred to the law as “the job- and small business-killing wage increase,” despite the fact that the hourly worker raises apply only to hotels with more than 60 rooms — the larger properties that are often owned by Hilton, Hyatt, Marriott and other large corporate brands that control much of the L.A. hotel room inventory. It also applies to companies doing business at LAX, such as food vendors and airline caterers.

“The ruthless greed of Delta, United [and] Marriott was matched only by their arrogance,” UNITE HERE Co-President Kurt Petersen said in a statement after the Alliance’s petition was denied. “They thought millions of dollars and lies could overturn the Olympic Wage. They were wrong.”

The Alliance needed 93,000 valid signatures to force a referendum on the wage law, in which voters would decide whether to overturn it. The group submitted more than 140,000 signatures. But the clerk found that only about 84,000 of them were valid. Some of those were withdrawn because of a massive outreach push by UNITE HERE workers, who claimed that many signers had been misled into believing they were actually supporting a pay raise, not scuttling the wage law.

In all, more than 117,000 people who signed the petition later asked that their names be withdrawn, according to the City Clerk’s Office. About 17,000 of those requests were granted by that office, causing the referendum’s proponents to fall short by thousands of signatures. 

The Alliance quickly cried foul. In a press release this week, the group said it sent a letter two weeks ago to Los Angeles County District Attorney Nathan Hochman, citing “evidence of criminal conduct” in the union’s signature withdrawal efforts and requesting an investigation.

“The numbers don’t lie,” the Alliance’s statement said. “The opposition to the referendum had a resounding failure rate on their own signatures [asking to withdraw from the petition], but somehow managed to also have a sky-high match rate for our signers. That has never been seen before, despite over 100,000 positive signatures. This mismatch suggests foul play — pure and simple.”

Asked about the Alliance’s claims, D.A. spokesman Josh Rubenstein said in an email, “The District Attorney’s office is not aware of any active investigation regarding this matter.”

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That doesn’t mean the business group is finished. Its release suggested that the Alliance will use the ballot initiative process to try to ram through changes to L.A. city laws that would benefit companies in other ways — such as asking voters to repeal the city’s $800 million business tax program.

The group also seemed to plead with Los Angeles Mayor Karen Bass to intervene in the ongoing disputes between the two sides, despite the fact that it was Bass who signed the measure into law. The Alliance said it was “eager for the Mayor’s leadership on a compromise that saves jobs and small businesses.”

In the meantime, hotel and airport workers continue on the job, many of them earning nowhere near a living wage, at least not yet. While the new hourly minimum of $22.50 is an immediate upgrade for many people, it’s far from enough. A single worker with no children needs to earn nearly $28 an hour to meet even basic living needs in Los Angeles County, according to the MIT Living Wage Calculator.

By the time of the 2028 Olympics, a living wage may be much closer to reality for the estimated 36,000 hotel and airport workers whose positions would see rising pay floors under this law — one reason the unions have pursued it so ferociously. Based on the evidence presented this week, though, the road to $30 an hour won’t smooth out anytime soon.

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