L.A. Plan May Help War on Poverty

Given the conservative tilt of the nation these days, chances are nil that Congress or any state legislature will try to renew President Lyndon B. Johnson’s War on Poverty, a war we’ve been losing badly since it began in the 1960s.

But a potentially potent thrust is being made at the enemy, poverty, with an innocuous-sounding “Service Workers Policy” that is expected to be adopted soon by the Los Angeles Community Redevelopment Agency, which was created to help restore blighted areas of the city.

If the unique idea here can survive strong legal challenges from employers, it could set a pattern for similar actions across the country by other communities that have redevelopment programs to reduce blighted areas and provide decent jobs.

The redevelopment agency’s clout here rests on the substantial help it provides to companies that are regenerating downtown Los Angeles, which boasts of a skyline of new buildings, with more on the way up.

But the agency says that from now on it wants employers who receive the benefits the city offers to abide by the proposed new policy, which would assure the service workers who are hired to clean new office buildings and work in new hotels of a “livable income,” which isn’t clearly defined yet.

However, it would mean that they would get about the same compensation generally paid to workers already employed in similar facilities within the agency’s jurisdiction, which includes most of downtown Los Angeles.

While service workers such as janitors and hotel maids usually are paid only the $4.25 hourly minimum wage, most in the downtown area are covered by union contracts that provide wages and benefits totaling about $7.50 an hour. Where such a pattern does not prevail, one could be established, based on the “livable income” theory.

The Los Angeles experiment would be the first in the country to apply what is known as the prevailing wage rule to service workers hired by employers who do not have contracts with the government but who benefit from government assistance.

Building construction companies helped by CRA are already required to pay craft workers prevailing wages and benefits, but never before has any local government body tried to protect low-wage workers such as janitors and hotel maids.

The CRA’s proposed policy has the backing of Mayor Tom Bradley and several key City Council members, but it has formidable opponents in the business community who have some strong legal arguments.

Key to the opposition’s legal battle plan is the concept of preemption--which means, foes of the policy insist, that the federal and state governments already have legislation dealing with such issues as minimum wages and benefits and therefore the city agency cannot issue orders dealing with the same matters.

Agency officials say they are not planning any legislation that might preempt action by them. Instead, they simply want to set an administrative policy that employers would have to follow if they want the help the agency provides.

The policy has strong support from the Service Employees International Union and the Hotel Employees & Restaurant Employees Union, whose major concern is that the CRA will not set the standards high enough.

James Wood, CRA chairman, says the philosophy of the agency’s proposed policy is simple enough: Developers and other employers should not be allowed to exploit those they hire to clean and care for their office buildings and hotels when they themselves are profiting partly because of government assistance.

“Everyone from the boardroom to the basement should gain,” argues Wood, who is also assistant executive secretary of the Los Angeles County AFL-CIO.

The principle underlying the CRA’s innovative policy isn’t new. Congress under President Franklin D. Roosevelt passed a law in 1933 requiring contractors doing federal government construction jobs to pay their workers the same wages and benefits that prevail in their communities.

Roosevelt and the New Deal Congress didn’t want to help greedy contractors get a competitive advantage with low bids they could make only by depressing the earnings paid by reputable companies in the same area.

Soon after that, the prevailing wage policy was extended to firms that supply products to the government: They could not get a government order based on a low price they are able to offer by slashing the wages and benefits of their workers.

In 1965, Congress applied the prevailing wage and benefit policy to workers employed by companies that provide any kind of service to the federal government.

It makes sense for the government to discourage employers from paying low wages in order to get federal contracts, and today many state and local communities have their own prevailing wage policies. However, they apply only to employers bidding on construction jobs.

The Los Angeles agency wants to expand that principle to any employer who benefits from government assistance, not just those who do business with the government.

It is a daring plan that faces rough legal challenges, but if it isn’t knocked down by our increasingly conservative courts, it may be a new, much needed weapon in our flagging war against poverty.