Hazard pay is coming to San Jose for grocery workers

Hazard pay is finally on its way for San Jose grocery workers.

After hours of debate, the San Jose City Council voted 7-3 on Tuesday to give retail food workers an extra $3 per hour for putting their health at risk during the pandemic.

Hazard pay would apply only to stores that have over 300 employees nationwide. The ordinance will be formalized Feb. 23 and will go into effect 30 days after. Once active, workers will get a pay bump for 120 days.

Businesses that already provide hazard pay to employees can receive a credit for the additional amount supplied to workers.

Councilmembers Sergio Jimenez, Magdalena Carrasco, Sylvia Arenas, David Cohen, Maya Esparza, Raul Peralez and Vice Mayor Chappie Jones voted in favor of the new ordinance while Councilmembers Dev Davis, Matt Mahan and Mayor Sam Liccardo opposed, citing concerns over the lack of analysis leading up to the vote.

Councilmember Pam Foley recused herself because her business has stock in Amazon. Amazon owns the grocery store Whole Foods, which would be affected by the ordinance.

A hazard pay proposal drafted by Jimenez could have been approved last week, but confusion and debate ensued over who could vote due to financial interests in Amazon. Jones also owned Amazon stock at the time, but quickly sold his one share to take part in this week’s vote.

Some lawmakers worried about potential unintended consequences of increasing pay for workers. They feared some workers would get their hours cut, some stores would close in low-income areas and that San Jose could be sued over the measure.

Long Beach is facing a lawsuit after mandating hazard pay. The council said it will follow the issue since the first hearing is on Feb. 19 — before San Jose’s ordinance goes into effect.

“I came out of last week’s conversation pretty disappointed. It felt to me like we were saying we should not try to educate ourselves of the unintended consequences of this policy,” Mahan said. “My experience in business tells me there are always trade-offs and I think as elected representatives, we have a responsibility to at least be open to the full picture.”

Liccardo said he appreciates providing certainty to struggling grocery store workers, but said it’s “also critically important that we keep stores open and avoid layoffs.”

Jimenez shot back, saying some of the private companies, including Asian food market 99 Ranch, are doing better than expected. 99 Ranch makes more than $200 million in annual revenue.

“They sound local, they sound like just the store down the block, but these are not,” Jimenez said. “These are massive stores that are doing well during these trying times.”

Jimenez pointed out that the plan already contains an exemption for small publicly-owned businesses and franchises. Originally, Jimenez proposed a $5 pay raise, but lowered the number to $3 for 120 days.

He said the 120-day period gives the council a good amount of time to analyze the impacts hazard pay has on businesses.

Esparza argued hazard pay will actually put more money back into the local economy.

“If you give folks a little bit of extra money, it goes to local retailers, it goes to local businesses,” Esparza said.

San Jose resident Audrey Moore said hazard pay is needed now.

Moore, who has worked for Safeway for 35 years, said she doesn’t feel safe at work even though she wears a mask, puts on gloves, and stands behind a glass shield. Customers still come up to her in close proximity and she said there is no consistent schedule for cart sanitation.

“(Hazard pay) probably should be the $5 that they were shooting for before, but we can settle for $3 because we’ve been on the front line ever since this happened,” Moore said. “We didn’t get a break at all. We had to do overtime because people were getting sick or you know, they didn’t want to come in.”

Contact Carly Wipf at [email protected] or follow @CarlyChristineW on Twitter.