LA City Council votes for $15 minimum wage

May 19, 2015: Workers react as the Los Angeles City Council votes to raise the minimum wage in the city to $15 an hour by 2020, making it the largest city in the nation to do so, in Los Angeles. (AP)

LOS ANGELES – The Los Angeles City Council gave initial approval Tuesday to raising minimum pay in the nation's second-largest city to $15 an hour by 2020, a closely watched step as Americans' wages have stagnated.

The council voted 14-1 after residents made impassioned statements for and against the plan.

"Today, help is on the way for the one million Angelenos who live in poverty," Mayor Eric Garcetti said in a statement, adding that "the minimum wage should not be a poverty wage in Los Angeles."

The vote sends the measure to the city attorney to prepare a wage ordinance. That ordinance will then go to a council committee and, assuming it passes, to the full council for a final vote and then to Garcetti.

The increases would begin with a wage of $10.50 in July 2016, followed by annual increases to $12, $13.25, $14.25 and then $15. Small businesses and nonprofits would be a year behind. Small businesses with 25 or fewer employees to have an additional year to reach the $15 plateau.

Council members noted that Los Angeles has 700,000 people earning minimum wage and one of the highest housing costs in the nation. California minimum wage is $9.

"The elephant in the room is the lack of affordable housing," Councilman Mitch O'Farrell said before the vote.

In April, Seattle began phasing in its new $15 minimum wage law. Most workers in Seattle saw the minimum wage increase to $11 an hour. Some small businesses got a $1 credit for employees who earn tips or get health insurance and now pay $10 an hour.

It will take until 2017 for Seattle workers at large companies and chains to earn $15 an hour. Those providing health insurance will have four years to comply. Smaller organizations will be given seven years, with the new wage including a consideration for tips and health care costs over the first five years.