• Small franchisees say Seattle wage law discriminates

    By: Essex Porter

    Updated:

    SEATTLE, Wash. - Seattle is fighting to defend a key part of the '15 dollar an hour' minimum wage law.

    But local franchise owners say the law discriminates against them, by treating their small businesses as big corporations.

    That includes BrightStar, a North Seattle home health care business that employees fewer than 50 people. Because it is a part of a national franchise, it is treated like a large corporation under Seattle's Minimum Wage law.

    It gets only three years to phase in $15 an hour, while independent small businesses can get twice as long.

    “What is being attacked is the way we chose to do business,” said owner Kathy Lyons, who is part of the International Franchise Association lawsuit against the City of Seattle.

    She told us her lawsuit is not about money, but discrimination against franchise small businesses.

    “We already pay above minimum wage to all of our employees,” Lyons said.

    Before three judges of the 9th Circuit Court of Appeals, nationally prominent appellate lawyer Paul Clement told said the law should judge businesses on their income not their franchise status.

    “There are some local franchisees that are operating at a knife's edge and have very little margin to pay these wages,” he said. 

    But the assistant city attorney lawyer Greg Narver told judges the differences are justified,

    “Another example of the business with the wherewithal to pay more because of the resources that are available to franchisees,” he said

    The city attorney believes the law will withstand scrutiny.

    “This city is trying to address income inequality. They're trying to put more money into the pockets of low income wage earners and they have to do so with a structure that makes sense,” said Pete Holmes

    And that scrutiny may go to the highest level, vows Steve Calderia, president of the International Franchise Association.

    “If we have to take this case all the way to the Supreme Court, we'll do it because we believe we're right.”

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