NCPA - National Center for Policy Analysis

Legal Challenge to Seattle Minimum Wage

June 23, 2014

Fox News reports that plaintiffs are suing the city of Seattle for raising its minimum wage to $15 per hour.

Just this month, the Seattle city council passed a $15 minimum wage, but leading the charge against the wage mandate is the International Franchise Association (IFA).

  • The law requires big businesses as well as small franchises to pay the $15 wage four years before mom-and-pop competitors are required to pay the higher wage.
  • There are 600 franchise businesses in Seattle that employ 19,000 workers.

The IFA argues that the law is discriminatory in its treatment of businesses of the same size, lumping small franchises into the same category as large businesses while giving non-franchises more time to comply with the law.

  • Chuck Stempler, whose graphics shop employs 69 workers, is one of the affected franchises. "We just want to be treated equally relative to our size. I'm not a 500-person company," Stempler said.
  • Similarly, franchisee Kathy Lyons took out a $235,000 loan to launch her franchise and invested her $200,000 life savings into the company. Now, she is afraid that the business cannot survive the wage mandate.

The IFA is not trying to block the $15 wage, but challenging the way that the law phases in the wage increase. By forcing franchisees to pay higher wages before other, similarly sized businesses are required to do so, franchisees will be at a severe disadvantage, the IFA says.

Source: Dan Springer, "Businesses Launch Legal Challenge to Seattle's $15 Minimum Wage," Fox News, June 18, 2014.


Browse more articles on Economic Issues