SEATTLE — A federal judge refused Tuesday to issue an injunction to halt Seattle’s $15 minimum wage law for franchise businesses such as McDonald’s and Subway, meaning the first wage increase will kick in April 1.
U.S. District Court Judge Richard A. Jones rejected the argument by industry lawyers that the law is unfair to franchise owners.
“This is a great day for Seattle’s fast food franchise workers,” Seattle Mayor Ed Murray said in a statement released afterward. “This ruling ensures that on April 1st, the minimum wage will go up for everyone in our city.
“Rather than investing in lawyers to prevent workers from earning higher wages, it is time for these large businesses to begin investing in a higher minimum wage for their employees,” the mayor said.
Although an injunction was not issued, the franchise industry’s lawsuit will still proceed to trial later this year.
Those businesses argue the new law is “not fair” and could cause many to shut down.
The $15 wage law was approved last spring, but lawmakers gave businesses almost a year to prepare for the higher costs. Starting April 1, the wage begins to phase in.
$15 Minimum Wage for Large Businesses (over 500 employees)
- April 1, 2015: $11
- January 1, 2016: $13
- January 1, 2017: $15
$15 Minimum Wage for Small Businesses (under 500 employees)
- April 1, 2015: $10
- January 1, 2019: $12
- January 1, 2021: $15
Under the law, franchises are considered large businesses, even though most of them have only a handful of employees. That’s because they are connected to big corporations. But franchise owners say that’s extremely unfair.
“If you are a Subway owner with five employees, you are treated worse under the law than an identical sub shop that has 50 employees and is not part of the franchise network,” said Christopher Bartolomucci, an attorney for the franchise association. “That’s not fair, that’s not equal treatment.”
But Seattle City Council member Kshama Sawant, the main driver behind the new wage, argues that franchises are not the same as mom and pop shops.
“You have to be practically a millionaire to be a franchisee and the big corporations have a lot of say in every franchise operation,” Sawant said. “These are not small businesses.”
This video below was filed Tuesday before the ruling came down: