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Judge Rejects Bid to Block Seattle's Minimum Wage Hike


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Seattle Mayor Ed Murray signing the wage hike ordinance last year.

A federal judge this week denied the attempt by five franchisee plaintiffs and the International Franchise Association to block portions of Seattle’s minimum wage law, scheduled to become effective April 1.

The issue isn’t the wage itself, which will increase to $15 an hour, but rather that it treats franchisees as large employers rather than small because they are part of a large franchise system.

That part of the ordinance is “discriminatory,” said the IFA’s Steve Caldeira in a statement, “and would harm hard-working small-business owners who happen to be franchisees. Those who have set out to destroy the long-accepted, time-tested and proven franchise business model must be stopped.”

Seattle Mayor Ed Murray has called the wage hike a “cornerstone priority of an opportunity agenda: a meaningful increase in the compensation for Seattle workers.” He formed the Income Inequality Advisory Committee shortly after taking office, and the new ordinance is one of that group’s recommendations.

IFA and five Seattle franchisees sued the city in June 2014, claiming the classification of franchisees as large businesses is really an attempt by organized labor to unionize large restaurant chains.

The law requires large businesses, defined as those with more than 500 employees, to raise the minimum wage to $15 an hour over three years starting in April 2015. Smaller businesses will have seven years to phase in the increase.

However, the Seattle ordinance “unfairly” requires Seattle’s 600 franchisees to meet the faster three-year deadline for large businesses, the IFA says. Matt Haller of the IFA declined to comment beyond the release, except to say they’re considering their next move.

“Yesterday’s decision is clearly a disappointment but it is not the end of this fight,” Caldeira’s statement said.

 

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The latest news, opinions and commentary on what's happening in the franchise arena that could affect your business.

Laura MichaelsLaura Michaels is editor of Franchise Times. She can be reached at 612.767.3210, or send story ideas to lmichaels@franchisetimes.com.
 
Beth EwenBeth Ewen is senior editor of Franchise Times. She can be reached at 612.767.3212, or send story ideas to bewen@franchisetimes.com.
 
Nicholas UptonNicholas Upton is restaurants editor at Franchise Times. He can be reached at 612.767.3226, or send story ideas to nupton@franchisetimes.com.
 
Mary Jo LarsonMary Jo Larson is the publisher of Franchise Times Magazine and the Restaurant Finance Monitor.  You can find her on Twitter at
 twitter.com/mlarson1011.
 

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