L.A. County could mandate ‘hero pay’ for some grocery, drugstore workers

Grocery and retail drugstore employees who work in unincorporated Los Angeles County could see a pay bump of $5 an hour if the county Board of Supervisors approves a “hero pay” ordinance this month.

The measure was quickly opposed by grocery industry leaders, who said it could require stores to raise prices at a time when their customers are struggling to make ends meet.

At the L.A. County Board of Supervisors meeting Tuesday, Supervisors Hilda Solis and Holly Mitchell put forth the motion that would mandate the pay bump for publicly traded grocery store or retail drug companies, or companies that have at least 300 employees nationwide and more than 10 employees per store site. If approved by the board, the ordinance would remain in effect for 120 days.

“While there is a light at the end of the tunnel, with the approval and administration of the vaccine, the health threats these workers face are as real as they were at the beginning of the pandemic given the surge of cases in our county,” Solis, chairwoman of the board, said in a statement. “It is imperative that we act with urgency to support just compensation for grocery and drug retail employees.”

The motion, which passed 4 to 1 on Tuesday, asks the county’s attorneys to draft an ordinance mandating the pay increase. Supervisor Kathryn Barger abstained from voting, saying she had concerns over unintended consequences. The board will vote on the measure at its next public meeting Jan. 26.

Solis and Mitchell asked in their motion for the county’s attorneys to determine whether the ordinance could apply to incorporated L.A. County. The city councils of Los Angeles and Long Beach are considering similar measures.

Ron Fong, president and chief executive of the California Grocers Assn., called the move by the board “unprecedented” and “irresponsible,” saying the extra money amounted to a wage increase of 30% per hour, which would probably force grocers to raise prices or consider cutting shifts or store hours. High volume during the pandemic doesn’t necessarily translate to high profit, he said.

“What the Board of Supervisors does not understand is: grocery stores are spending an inordinate amount of money running the stores under a pandemic,” including buying masks and other protective equipment for employees, much of which must be changed at least daily, adding plexiglass to registers and buying more cleaning supplies to keep stores safe, he said.

Advocates in favor of the proposal, though, said that the pandemic is also unprecedented.

“Many grocery and drug retail workers have become the primary earners in their household as families struggle under the combined weight of COVID-19 and widespread unemployment,” said Amardeep Gill, director of the grocery and retail project at the Los Angeles Alliance for a New Economy.

Solis and Mitchell quoted a Brookings Institution report released in November showing that the top 13 retail companies in the U.S., including Costco, CVS Health and Kroger, which operates grocery chain Ralphs, reported 2020 profits of $63.4 billion, which included an additional $16.7 billion compared with 2019 profits. (Walmart and Amazon made up the majority of the increase, reporting $10.7 billion in additional profit in the first three quarters of 2020 compared with 2019.)

The report found a range of approaches from some of the nation’s largest retailers in compensating employees facing COVID-19 risk. Kroger initially provided a $300 bonus for full-time workers in March before announcing a $2-an-hour increase, which lasted until mid-May, according to the Brookings report. After facing public outrage, the company provided a final $400 bonus in June, according to the report.

Other large corporations, including Target, Best Buy and Home Depot, have been more generous, raising wages or providing hazard pay, according to the report.

Fong said the report was inaccurate and that large grocers in California had continued paying $2 to $3 an hour more, and have provided bonuses and gift cards, “a plethora of extra incentives given to all employees.”

Margaret Holguin, a 55-year-old shift supervisor at CVS in Arcadia, said the company had given her only a small bonus in June that came to $150 after taxes.

Holguin, who has worked for CVS since 1986, said that because her store offers coronavirus testing, customers who might be infected often come inside the store when they’re supposed to use the drive-through for testing. This puts her and other workers at a much higher risk, she said.

“We’re putting our lives at risk to make so much money for this company benefiting off of us,” she said. “The miniscule hazard pay they’ve given us so far, literally I want to throw this back in their faces.”

Nurses from a nearby hospital often share with Holguin how they’ve seen patients die on their shifts, and her regular customers have told her about their loved ones who are sick or who have died of COVID-19. She doesn’t have to read the news to know the pandemic is getting worse.

“Thankfully nobody has gotten sick [at our store], which I better knock on wood, because I know every other store in our area, they’ve had exposures,” she said.

Barger, whose 5th District includes much of northern L.A. County, abstained from the vote, saying she was concerned about whether companies that have already increased wages and are offering hazard pay would be required under the mandate to pay the additional $5 an hour.

Barger said that although she supported the concept, she worried about the unintended consequences that mandating “hero pay” would have and asked whether it would apply only to hourly workers or extend to salaried employees.

“I am concerned the board is voting on a substantial pay increase for all employees, regardless of their position or salary, without taking the time to carefully consider the potential impacts of these decisions,” Barger said in a statement.

Times staff writer Hayley Smith contributed to this report.