May 05

Ron Jackson

Challenging Seattle's $15/hr. Minimum Wage Law

by Ron Jackson

As has been widely reported, Seattle was one of the first cities in the nation to enact a law mandating a much higher $15 per hour minimum wage.  In addition to Seattle, the State of California recently passed a new $15 minimum wage law, and many other cities and states are considering similar legislation.

Seattle’s law was challenged by owners of franchises such as fast food chain restaurants because it treats locally-owned franchises as part of the national franchise in determining the minimum wage requirements.  The franchise owners claimed they were independently owned and operated businesses, and should not be treated as part of the national franchise company, for example, McDonalds or 7-Eleven.  The franchise owners sued in Federal District Court to block implementation of Seattle’s new wage law.  The District Court refused to block the new minimum wage requirements and the District Court’s ruling was upheld on appeal by the Ninth Circuit Court of Appeals.  The U.S. Supreme Court has declined to review the decision by the Court of Appeals, meaning the minimum wage law will continue to apply to local franchise businesses.

If you own a local franchised business, or are considering buying or selling a local franchise, your business could be impacted by this new minimum wage law.

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