Without knowing the specific ordinances to which your question refers, it is difficult to be definitive. However, the Labor Code prohibitiion does govern all places of employment in the State. City's laws cannot supercede these provisions, which the State Legislature has declared to be a matter of statewide concern.
As you may be aware, Labor Code section 6404.5 did allow smoking in bars and taverns until 1998. It is possible that the local ordinances to which you refer are simply not up to date. Another possibility is that the exemptions to which you are referring do not apply to "places of imployment," but are limited to sole proprietorships. Again, without knowing the specific ordinances, it is hard to know for sure if they are simply out of date.