Los Angeles Passes Olympic Wage Ordinance: What Employers Need to Know

On May 27, 2025, Los Angeles Mayor Karen Bass signed into law a set of union-sponsored amendments to ordinances benefitting employees in the hotel industry and at Los Angeles International Airport. (Final ordinance text available here) The ordinances impose new training requirements and dramatically increase the minimum compensation for hotel and airport employees. Employers at LAX and hotels throughout the city with 60 or more guest rooms—or 50 or more if located near LAX—must comply with new training, recordkeeping, wage, and health benefit mandates.

1. Minimum Wage Increases for Airport and Hotel Employees

Beginning July 1, 2025, unless exempted in a collective bargaining agreement, airport and hotel employees must be paid the following minimum hourly wage rates:

Beginning July 1, 2026, hotel employees must also be provided health benefits at rates that match those already applicable to airport employees. The airport employee health benefit hourly rate, effective July 1, 2025, is $7.65 per hour. Once this requirement becomes effective for all hotel employees on July 1, 2026, the rate will be adjusted by a percentage equal to the annual health benefit cost increase, as measured and announced by the City on April 1 of each year.

If health benefits are not provided or the total health benefit payment is less than the required amount, employers must pay the difference to employees as an hourly wage.

Employers must maintain documentation of compliance and make it available to the City upon request.

2. Mandatory Public Housekeeping Training

Beginning December 1, 2025, hotel employers must pay for all room attendants to complete a six-hour, City-certified “Public Housekeeping Training” covering employee rights, safety protocols, and best practices for identifying threats such as human trafficking, domestic violence, and criminal activity. The training will be provided by a third-party organization approved by the City and conducted during paid work time. Employers must retain proof of such training for five years and may not employ a room attendant for more than 120 days without training certification.

Employers must provide each employee a written notice of the employee’s rights at the time of hire or within 30 days of the effective date of these ordinance provisions, whichever is later.

3. Implications for Employers

While the ordinances are ostensibly intended to support employees leading up to the 2028 Olympic Games, they present operational and financial challenges for many businesses. Many hotel owners and operators have already raised concerns, particularly those that committed to room rates for Olympic guests years in advance and did not account for such steep wage and benefit increases.

4. Compliance and Potential Legal Issues

There are several areas where legal concerns may arise:

• Preemption under ERISA: The healthcare benefit requirement could face scrutiny under the federal Employee Retirement Income Security Act (ERISA), which limits the ability of states and municipalities to regulate employee benefit plans.
• Unionized Workplaces: Employers with collective bargaining agreements may waive certain requirements, but only through clear and unambiguous waiver terms negotiated with the union.
• Other Concerns: Various constitutional challenges to the ordinances are being considered. Hotels that signed Olympic-related room rate agreements are considering whether those agreements may be renegotiated or terminated.

The ordinances permit the City to issue rules and regulations. Employers will be looking to those rules and regulations to address other questions that the ordinances raise.

If your business falls within the scope of the ordinances, now is the time to prepare. The ordinances provide for civil enforcement by employees, the City, and certain third parties. Employers that violate the ordinance are subject to significant penalties, fines, payment of the prevailing party’s attorney’s fees, and other remedies.

5. Final Thoughts

The “Olympic Wage” Ordinance reflects Los Angeles’s broader goals of promoting economic equity during a high-profile international event. However, for many employers, it represents a significant regulatory and financial burden. Proactive compliance planning—along with close monitoring of legal developments and potential challenges—will be critical.

If you have any questions about the matters discussed in this issue of Compliance Matters, please call your firm contact at (818) 508-3700 or visit us online at www.brgslaw.com .

Sincerely,

Matthew T. Wakefield

Eric W. Mueller

Alec S. DiMario