Restaurant owner WeHo fears rising wages could lead to job losses

WEST HOLLYWOOD, CA – As a West Hollywood restaurant owner, Walter Schild kept his restaurant afloat during the pandemic; However, the city’s latest wage hike, as its restaurant recovers, could be another hurdle.

“We’ll have to cut back on the hours, we won’t reopen for brunch and I think some businesses will be forced to leave,” Schild said.

The City of West Hollywood has approved an ordinance gradually increasing the minimum wage to $ 17.64. The first increase will take effect in July 2022.

Based on Schild’s costs and income in 2019, he believes the difference will impact his bottom line and reduce increases in kitchen staff.

“Our restaurant, most full-service restaurants with lots of cooks and service staff, make 5% or 7% of profit because of labor. This is our biggest expense and this order creates an additional cost of $ 300,000 and we are losing $ 150,000, ”Schild said.

Schild said his servers are his biggest employees, often making between $ 30 and $ 50 an hour, combining hourly wages and tips. He added that kitchen staff earn around $ 18 an hour and likely won’t see the benefit.

Business owners like Schild in the city have expressed that they are not necessarily opposed to the increase. Their concern is how it is applied. As more restaurant and bar owners like Schild speak out, Mayor Lauren Meister said the city will go one step further to make the model suitable for business.

“The ultimate goal is to get to a point where everyone has the same minimum wage. I just think that because restaurants and bars have a different business model than a lot of other companies, it might take a little longer than expected, ”Meister said.

Schild’s Rosaline restaurant on Melrose is a short distance from businesses in the city of Los Angeles that will not be subject to the same pay rise. According to Schild, a problem could make it difficult for WeHo companies.

“West Hollywood is too low today, I think. That’s up to the standard of $ 13. I think you should increase that to the Los Angeles level and I think you should recognize and allow us to pay our kitchen staff more by not demanding thousands of dollars in wages for workers earning over 60,000 $ per year, ”Schild said.

Until then, he will continue to keep his restaurant on track. He just hopes this new obstacle won’t be the last straw for other businesses to stay open in the city.

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