The Canadian Press - ONLINE EDITIONBy: Gene Johnson, The Associated PressPosted: 03/10/2015 4:36 PM ...

1. Businesses seek to block portion of new Seattle minimum
wage law
The Canadian Press - ONLINE EDITION
By: Gene Johnson, The Associated Press
Posted: 03/10/2015 4:36 PM | Comments:
SEATTLE - A federal judge is considering whether he should block part of Seattle's new minimum
wage law before it takes effect next month, on the grounds that it discriminates against franchises
that are part of large national chains.
The law, which raises the city's minimum wage to $15 an hour, is phased in more quickly for big
companies than small ones. Among those determined to be big companies under the law are
franchises -- from fast-food joints to hotel chains -- that are connected to networks that in all have
more than 500 workers.
Paul Clement, a former U.S. solicitor general who is representing the International Franchise
Association and five franchises in Seattle, told Judge Richard A. Jones during arguments Tuesday
that's unfair. They're essentially small businesses, he said, but by 2017 they'll have to pay their
workers a minimum wage $4 higher than their purely local competitors.
That punishes those companies for their involvement in interstate commerce, he said -- a violation of
the Constitution's Commerce Clause, which reserves the regulation of interstate commerce to the
federal government.
"'Buy Local' as a city policy is 100 per cent prohibited by the Commerce Clause," he said.

2. Assistant city attorney Greg Narver responded that the law's intent was simply to raise the pay of
Seattle's low-wage workers, and that the City Council wanted to draw the line somewhere as far as
which businesses could afford to pay the higher wage when. Because franchises receive benefits
from their association with their chains -- national marketing, training, product development -- it was
perfectly reasonable for the city to treat them differently, he said.
Seattle's law gives businesses with more than 500 employees nationally three years to phase in the
increase -- four if they provide health insurance. Smaller employers get seven years.
On April 1, the large businesses and national chains must raise their pay to at least $11; smaller
ones to at least $10. Some franchise owners, including David Jones, who owns two Subway sandwich
shops in town, say they'll need to raise prices to cover it.
They note that they pay for the benefits they receive from their chains, such as through franchise,
marketing or training fees.
The city has stressed that the law is not discriminatory on its face: It applies to any business that is
part of a network of at least 500 employees, whether that chain is an interstate behemoth or one
located entirely in Washington state. But Clement argued that it is discriminatory in its effect,
because 96 per cent of the franchises subject to the quicker $15-an-hour phase-in are part of
national chains.
He also pointed to emails from Nick Hanauer, a prominent Seattle entrepreneur who served on an
advisory committee looking at the minimum wage proposal, as evidence of the city's intent to
discriminate against interstate franchises. Hanauer referred to "extractive national chains" as
"civically corrosive," and suggested they should be considered large businesses for purposes of the
law.
The judge noted that Hanauer was just one of 24 members of the committee and questioned whether
there was any evidence the city adopted his views about big chains. He also grilled Clement about
whether the city's intent would matter in the absence of a discriminatory effect, asking whether he
had case law to support his position or whether it was just so much "creative spin."
Clement acknowledged he didn't have case law that was exactly on point, but said he shouldn't be
expected to because the city's approach is so novel.
"We said from day one this is not about trying to destroy the minimum wage law," said Matthew
Haller, a spokesman for the franchise association. "It's about equal treatment."

3. Working Washington helped organize walkouts by fast-food workers that sparked the $15-an-hour
law. Sage Wilson, a spokesman, said franchises can handle the accelerated pay schedule.
"These workers have been waiting and fighting to make ends meet for years now," he said.
The franchises are seeking a preliminary injunction that would block the relevant part of the law
from taking effect April 1, pending a ruling from Jones expected later this year on the full merits of
the case. Jones said he would do his best to decide by next Tuesday whether to grant the injunction.
___
Follow Johnson at https://twitter.com/GeneAPseattle
http://www.winnipegfreepress.com/business/businesses-seek-to-block-portion-of-new-seattle-minimu
m-wage-law-295811151.html