Washington Push for Higher Minimum Wage for Workers Has Walmart Balking

Mayor Vincent C. Gray, who worked hard to lure Walmart, finds himself caught in the middle, and many residents sound less than grateful to lawmakers.

“Those big people in government, they don’t understand my situation,” said Fred Reaves, 45, who is unemployed and said he would gladly take a job at the current city minimum, $8.25.

“Eight-something, it’ll motivate you to start going to work,” Mr. Reaves said as he stood around the Skyland Town Center, a patch of barren asphalt and shuttered stores where Walmart planned to build. “You can start paying some bills. It will help you to come off public assistance.”

On July 10, the City Council passed a “living wage” measure that would require Walmart to pay at least $12.50 an hour, saying it was fighting to protect struggling residents in what has become a high-cost city.

Supporters of the measure say that Walmart, whose revenues in 2012 were $469 billion, can well afford to pay workers more.

“Their net income was $17 billion,” said Vincent Orange, a city councilman who voted for the ordinance. “You don’t want to share a little bit with the citizens? Come on.”

A decade ago, the city gave tax breaks to lure retailers, Mr. Orange said, but now it is booming and can negotiate from strength.

The day before the City Council passed the measure, a Walmart official warned in an op-ed article in The Washington Post that if required to pay $12.50 an hour, the company would cancel three planned stores and consider withdrawing from three projects already under construction.

The next move is up to Mayor Gray, who is weighing a veto.

Officially the mayor has taken no position, but he is widely seen as opposed to the measure. The Council has delayed formally sending it to his desk for action. The measure, called the Large Retailer Accountability Act, would require stores of at least 75,000 square feet that are owned by companies with $1 billion or more in annual revenue to pay the higher minimum wage. Because existing stores and those with unions are exempt, it is seen as squarely aimed at Walmart.

As Walmart, the world’s largest retailer, has sought inroads in major cities, it has faced resistance from local merchants, who fear being undercut, and from officials who say minimum-wage jobs mire workers in poverty.

Democrats on the House of Representatives work force committee produced a report this spring contending that the government subsidizes Walmart because employees earn so little that they qualify for Medicaid, food stamps and housing assistance.

Pedro Ribeiro, a spokesman for Mayor Gray, argued the opposite: minimum-wage jobs help the chronically unemployed take a first step into the work force.

“Yes, Walmart jobs are not great,” Mr. Ribeiro said. “But for some people, it will be their first employment and they’re not qualified to do anything else. We need that entry-level benchmark in the District.”

Washington is experiencing an economic revival, with population growth on a par with Sun Belt cities. But the benefits are not spread evenly. East of the Anacostia River in Ward 7, where two of the Walmart stores, including the Skyland site, are planned, unemployment is 13.9 percent. In nearby Ward 8, it is 20 percent.

Victor L. Hoskins, the deputy mayor for development, said Walmart’s threat to cancel projects if the measure took effect was no bluff. He calculated that 4,000 retail and construction jobs were at stake from three of the projects.

“The question is not $8.25 versus $12.50,” Mr. Hoskins said. “The question is $8.25 versus zero. It’s called no jobs.”

Opposite the Skyland site, on Good Hope Road, Carl Williams, 49, a barber at the Like That salon, whose dozen barbers were bustling on Thursday afternoon, had mixed feelings. He thought $12.50 was a fair starting wage. But he said he would not hesitate to encourage his two daughters to take a job at Walmart for $8.25.

“One who is 21 needs a job real bad,” he said. “She had a baby real young and didn’t finish high school.”

At a nearby Shoe City, the assistant manager acknowledged that Walmart might undercut her prices. But the giant retailer would also increase foot traffic in the neighborhood, which could benefit Shoe City, the manager, Shasherri Hindman, said.

Ms. Hindman, 25, said she started at minimum wage five years ago and worked her way up. “What’s wrong with $8.25?” she said. “I’m totally on Walmart’s side.”

Willie Ford, 39, a carpenter, scoffed at the notion that Walmart could not afford to pay $12.50. “Come on, they’re going to make beaucoup money from this area,” he said. At the same time, he acknowledged that many people in the neighborhood would gladly take a job at $8.25. “Like a newborn baby, you’ve got to crawl before you walk,” he said.

At an Upscale Beverly Hills Restaurant, Claims of Underpaying Workers

Urasawa, a restaurant on Rodeo Drive in Beverly Hills, serves sushi using ingredients mostly imported from Japan. A typical bill for two easily tops $1,000, and some dishes include 24-karat gold flakes.

BEVERLY HILLS, Calif. — One of the country’s most renowned sushi restaurants, Urasawa, sits in a small alcove above Rodeo Drive here. A typical bill for two people easily tops $1,000. Over an evening that can stretch to three hours, diners are served dishes dotted with caviar and 24-karat gold flakes (for the iron, the chef notes).

Heriberto Zamora, left, is suing for back pay. His lawyer, Kevin Kish, right, said, “We see this happen all the time, across all industries, all parts of the city and all kinds of businesses.”

But workers in the back kitchen are routinely denied overtime pay and forbidden from taking breaks, according to former employees and a California Labor Department investigation. Now, the chef and owner, Hiroyuki Urasawa, is battling state and civil claims that he withheld tens of thousands of dollars in wages and overtime from workers. One former employee who left the restaurant last year said he resorted to urinating in the sink meant for cleaning mops after being told the men’s restroom was for customers only during business hours.

Each night, Mr. Urasawa stands behind a pristine sushi bar serving more than a dozen dishes, each with an elaborate description of the provenance of the ingredients, mostly imported from Japan. With an affable smile, he happily accepts sake from diners, who can spend hundreds of dollars on a bottle.

“It was always about the customers, making sure that they were happy,” said Heriberto Zamora, 26, who worked at the restaurant for more than five years and has filed a civil suit for back pay. “None of the employees were treated very well. We knew people were paying a lot to eat there, but for us it was no different.”

After immigrating from Oaxaca, Mexico, as a teenager, Mr. Zamora found a job at Urasawa through a friend. He worked his way up, starting as a dishwasher and eventually cleaning and preparing the fish and arranging precisely cut vegetables. After a promotion, while he was earning about $9 an hour, Mr. Urasawa forced him to buy his own $700 set of knives — each meant to touch only certain ingredients, Mr. Zamora said. Eventually, he was working nearly 60 hours a week for $11.50 an hour.

One day last June, nine hours into his shift, Mr. Zamora was coughing and asked to go home, complaining of a fever, he said. Mr. Urasawa fired him on the spot, he said.

Mr. Urasawa and his lawyer declined to comment for this article. But he has appealed a ruling issued by the state last month fining him $55,000 for failing to pay overtime and give breaks to Mr. Zamora and three other employees.

Mr. Urasawa is not the first high-end chef to face charges from workers. Mario Batali and his partners ultimately reached a $1.5 million settlement last year with a group of employees at several of his restaurants in New York.

The Urasawa case has become something of a battle cry among the overwhelmingly immigrant work force in hundreds of kitchens here. Labor and immigrant advocates say Mr. Zamora’s experience is typical for thousands of workers in restaurants, regardless of how much customers might be paying to eat there.

The problem is particularly acute in businesses that rely on cash to pay workers, as many restaurants do. A 2009 study by the Labor Center at the University of California, Los Angeles, found that there was an average of $26 million worth of wage violations each week in Los Angeles.

“There are countless examples in which workers are taking home less than they’ve earned,” said Julie Su, the state labor commissioner, who has made cracking down on wage violations a focus of her office. In the case of Urasawa and dozens of other restaurants, investigators wait outside watching workers come and go, comparing what they see to the time records kept on employers’ books. “It’s a perversion of the concept of minimum wage — it goes from being some kind of floor to instead being some kind of ceiling,” Ms. Su said.

Ms. Su has investigated hundreds of wage violation cases this year, using individual complaints as starting points for many of the investigations. In countless cases, she said, owners rely on paying the same rate over 12 hours, though such practices violate labor laws created a century ago in part to ensure that employers hire a sufficient number of people, rather than rely on one worker for many hours.

“We see this happen all the time, across all industries, all parts of the city and all kinds of businesses,” said Kevin Kish, a lawyer for Bet Tzedek, a nonprofit legal group that has taken on Mr. Zamora’s case. “The only thing that is remarkable about this case is that people might expect paying so much means that workers are getting paid fairly.”

After Mr. Zamora was fired, a friend told him to go to the Koreatown Immigrant Workers Alliance, which helps many workers file wage violation complaints. This spring, the organization held a daytime protest in front of Urasawa, which garnered some attention in the local news media.

Zombie Workers of the World Unite!

Have a good Labor Day and we’ll see everyone tomorrow.