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Thursday, June 5, 2014

Minimum Wage Increased To $15 An Hour in Seattle -- But Some Say It's Not Fair

Seattle $15 minimum wage

The City Council in Seattle, Washington recently announced an unprecedented decision to raise the state's minimum wage. What is unprecedented about it is the size of the increase -- $15 an hour. They were previously at $9.32 an hour, the highest wage among all U.S. states. Although the announcement is great news for many workers, others are calling it unfair and discriminatory.

Why unfair?

The International Franchise Association, an organization that works to support franchising as a method of business ownership, is livid about Seattle's announcement and plans to take action against the state. They are calling Seattle's minimum wage increase unfair. Why? Because they feel it will hurt small business franchise owners.

The problem with the phase-in period

Under the new minimum wage increase agreement, Seattle businesses will have from 3-7 years to increase their minimum wage rates to comply with the state law. The sticking point is how franchises are being categorized. Smaller businesses will have more time to comply, but a franchise owner may need to comply quicker because they are associated with the parent brand company, such as a McDonald's franchise owner. This categorizes them as a larger company, which is what the International Franchise Association is objecting to. As the organization's president stated recently, "Franchise businesses are independently owned businesses and are not operated by the brand’s corporate headquarters.”

On the other hand...

The minimum wage increase will make a big difference to many low-income workers who are struggling to support their families. Some would desperately like to change their circumstances by going to school in order to get a better paying job, but they can't afford it. The wage increase may make it possible for many to go back to school and improve their economic status and in the meantime, also take care of their families.

Several other cities, from Chicago to Los Angeles, are also considering proposals to raise their state minimum wage.


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