Car wash owners say they’re being hosed.
The City Council is considering a bill to regulate car washes – a tiny industry with just 200 outlets – imposing a long list of regulations that some owners say will put them out of business.
The laws would require car wash owners to pay a $550 fee to get licensed by the Department of Consumer Affairs and to put up $300,000 in surety bonds as insurance for lawsuits or other claims. Owners would also have to pass “character” screenings, just like job applicants in the once mobbed-up carting industry.
During a hearing before the Civil Service and Labor Committee on Thursday, car wash owners estimated they would pay as much as $15,000 a year to get bond — assuming they could get one.
“Requiring a $300,000 surety bond alone would put most our industry out of business as no surety company will provide such a bond to a car wash business,” said Stephen Bernard, a car wash owner and member of The Association of Car Wash Owners. “And that’s the surety bond industry telling us that.”
Critics say the bill is a thinly-disguised attempt to force the car washes to unionize. Before the bill was amended, the surety bond was set at only $30,000 for unionized facilities.
“This law is pushed by the union,” said one car owner who asked not to be named for fear of union retaliation.
Advocates and union organizers say the new regulations are needed because wage theft — owners paying below minimum wage, refusing to pay overtime rates, and even stealing tips — is rampant at car washes.
The advocates say some car wash owners sued by employees have sold their businesses and refused to pay back wages.
“We need to make minimum wage, we need overtime. We are very much tired of paying out of our tips if anything is damaged — they are supposed to have some type of insurance to cover this damage,” said car wash worker Juan Carlos Rivera.
A 2010 Department of Labor reporter from 2010 showed that nearly 80 percent of City car washes were suspected of wage violations. Workers were also logging more than 70 hours a week below the minimum wage and had to split tips among with non-service employees, the report found.
The bill has the support of the mayor and City Council speaker.