Antitrust Law Daily Wrap Up, FRANCHISING & DISTRIBUTION NEWS: New York proposal to raise minimum wage for fast-food workers is discriminatory: IFA, (May 8, 2015)

By Edward L. Puzzo, J.D.

Reacting to New York Governor Andrew M. Cuomo’s proposal to increase the minimum wage for fast-food workers, the International Franchise Association has condemned as discriminatory any minimum wage increase that is not applied uniformly to all types of businesses.

Yesterday, Governor Cuomo announced that he was directing the state labor commissioner to empanel a Wage Board to investigate increasing the minimum wage in the fast food industry. Citing an estimated $700 million annual cost to taxpayers in providing public assistance to fast-food workers and their families, Cuomo stated “If you work full time, you should be able to provide for yourself and your family and move beyond poverty. That is what the minimum wage is all about, but for too many fast food workers in New York today that is simply not the case.”

Cuomo noted that he proposed raising the minimum wage to $11.50 in New York City and $10.50 elsewhere in the state, but the state legislature rejected that proposal. However, he noted, state law empowers the labor commissioner to investigate whether wages paid in a specific industry or job classification are sufficient to provide for the life and health of those workers — and, if not, to impanel a Wage Board to recommend what adequate wages should be.

Consequently, Cuomo announced that he was directing the State Labor Commissioner to impanel such a board, to examine the minimum wage in the fast-food industry. The board—made up of at least three members with equal representation from labor, businesses and the public—will return in about three months with its recommendations, which do not require legislative approval.

“New York State can raise its minimum wage if it wants to. But it should not pick off one industry at a time,” stated IFA President & CEO Steve Caldeira. “Doing so would echo the ill-conceived action of the City of Seattle, which is being sued because it designed an unconstitutional minimum wage that rises faster for franchise businesses than other types of businesses.”

“Governor Cuomo should do the right thing and consider a uniform wage increase for all businesses similar to that of Mayor Emanuel in Chicago, who heeded franchisees appropriate concerns with discriminatory treatment,” said Caldeira. “Small business restaurant franchisees face the same challenges as all other small businesses. Mayor Emanuel was applauded because he listened to the concerns of his city's small business franchisees. He rejected the politically-motivated, labor-backed actions of Seattle. Gov. Cuomo should do the same.”

News: FranchisingDistribution NewYorkNews