Hotel workers want tax on companies with 'overpaid' CEOs

Progressive forces in Los Angeles are taking aim at companies with bloated executive pay through a ballot initiative.

On Wednesday, a coalition led by hotel workers union Unite Here Local 11 launched a signature-gathering effort for a ballot proposition they called the "Overpaid CEO Tax." If the proposition makes the November ballot, it will ask voters to impose an additional city business tax on large companies with CEO pay that is exponentially higher than worker pay.

Representatives of some of Los Angeles' most powerful unions, including the Los Angeles teachers union UTLA, gathered in Hollywood to announce the launch. They spoke on the sidewalk outside of the Tesla Diner — a recently opened charging station and restaurant owned by world's richest man Elon Musk.

"A growing and dangerous divide is tearing Los Angeles apart. On the one side, corporate CEOs live in their own world," said Unite Here Local 11 co-president Kurt Petersen. "On the other side, workers … juggle two and three jobs, they make impossible choices between medicine and rent."

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The initiative takes aim at big corporations. If passed by voters, the executive pay ordinance would impose an additional business tax on companies with at least 1,000 employees whose top executive makes more than 50 times the median worker pay in Los Angeles. Those funds would go toward low-income housing projects, sidewalk repairs and other projects.

The additional tax would be one to 10 times the typical city business tax. According to the city clerk's office, the current city business tax is between 0.1% and 0.425% of gross receipts.

The campaign is part of a bigger political fight over the coming Olympic Games and who will benefit from them.

The executive pay initiative is one of a series of competing ballot propositions launched by union and business interests after the Los Angeles City Council voted last year to raise the minimum wage for hotel and airport workers to $30 an hour by 2028.

That vote set off a cascade of responses from the companies it affected. A business group backed by Delta and United Airlines launched a referendum to repeal the wage increase. That effort eventually failed.

The fight around the so-called "Olympic wage" is still playing out. A coalition of business interests has introduced its own ballot initiative to eliminate the city business tax entirely. In December, City Council President Marqueece Harris-Dawson introduced a motion to delay the $30 minimum wage by two years.

Campaigners for the executive pay tax will be on the ground as hype around the Olympics ramps up. Ticket registration opened for fans on Wednesday morning, the same day union leaders gathered in Hollywood.

To land the ballot initiative on the November ballot, campaigners have 120 days to gather around 140,000 signatures from registered voters in the city of Los Angeles.