Franchising association seeks to halt Seattle’s minimum wage increase

Aug. 6, 2014

The International Franchise Association has asked the U.S. District Court for the Western District of Washington to issue a preliminary injunction preventing the City of Seattle from raising its minimum wage.

The IFA says the city's recently enacted law to increase the minimum wage to $15 an hour "discriminates against small franchise businesses." The IFA and five Seattle franchisees sued the city in June to block portions of the law.

Seattle's ordinance requires businesses with more than 500 employees to raise the minimum wage they pay their employees to $15 an hour over three years starting in April, 2015. Smaller businesses get seven years to phase in the wage increase.

According to a news release from the IFA, at the request of the Service Employees International Union, the law also treats a single restaurant as if it employs more than 500 people due to its affiliation with a national chain.  

The plaintiffs asked the court to "immediately enjoin the city from treating franchisees as large, national companies rather than the small, locally-owned businesses that they are."

IFA CEO said Seattle city council passed the ordinance to "score political points by helping the SEIU increase its membership."

"The ordinance is clearly discriminatory and severely hurts hard-working small business owners who are franchisees," he said in the release. "This shortcut cannot be accomplished through a city ordinance and our lawsuit – and now our motion for preliminary injunction – will provide franchise small business owners their rightful opportunity to present this case in court. Under the guise of raising the minimum wage for workers, the SEIU has blatantly attempted to destroy the long-accepted, time-tested and proven franchise business model."   

Topics: Franchising & Growth, Operations Management

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