Showdown in Seattle over city’s minimum wage law | Don Brunell

Ever since the $15 wage proposal was narrowly approved by City of SeaTac voters, municipal leaders in neighboring Seattle have pushed to impose the same edict.

Ever since the $15 wage proposal was narrowly approved by City of SeaTac voters, municipal leaders in neighboring Seattle have pushed to impose the same edict.

Washington already has the nation’s highest starting wage of $9.47 an hour and the state legislature is considering hiking it to $12, but Seattle Mayor Ed Murray and some city leaders want to peg it at $15.

Starting April 1, large businesses in Seattle – defined as those with more than 500 employees – will be required to raise the minimum wage they pay their employees to $15 an hour over three years. On the other hand, smaller businesses will have seven years to phase in the wage increase.

The new law classifies Seattle’s 600 franchisees – who operate 1,700 franchise locations and employ 19,000 workers – as large businesses simply because they operate as part of a franchise network.

Franchisees say that is unfair.

The crux of the issue is not the wage itself; it is that the city is equating individual franchises with their parent corporations, which are two very different types of businesses. It is Seattle’s precedent-setting action which worries franchise owners.

The International Franchise Association, the world’s largest organization representing franchise owners, is seeking an injunction to block the ordinance and is appealing a recent federal court decision that will allow the law to go forward.

During their nationwide campaigns, minimum wage activists targeted McDonald’s, positioning its franchises as agents of a global conglomerate. It is true that McDonald’s is the world’s leading foodservice retailer operating in more than 100 countries, with more than 36,000 restaurants serving approximately 69 million people every day.

But more than 80% of its restaurants worldwide are operated by individual small business owners.

So, what is a franchise?  It’s like leasing a brand name and a business model.  After that, you’re on your own.

Take McDonald’s franchises, for example.

First, to be considered for a franchise, you must have $750,000 available to invest – the money cannot be borrowed.  You sign a 20-year contract, make a six-figure down payment and agree to abide by their standards and practices.  Then you undergo months of training.

For new restaurants, McDonald’s provides a location and a building shell, but you must pay to complete the interior and provide all the equipment and pay all operating expenses, including rent, business and property insurance, utilities, salaries, unemployment insurance, workers’ compensation and taxes. In addition, you must pay the corporation four percent of your sales each month, contribute to national and regional marketing campaigns and purchase your supplies only from approved vendors.

So, are individual franchise owners equivalent to their corporate lessors?

Think of it this way:  If you operated a coffee stand in the lobby of the Trump Tower in New York City, would your business be considered part of Donald Trump’s business empire?  Of course not.  You would have signed a lease agreeing to pay the required rent and abide by Trump’s rules.  In return, you get a prime location with proven name recognition and access to a specific customer base.

The same applies to franchises.

There are 780,000 franchisees in America that support nearly 8.9 million direct jobs and contribute $890 billion to the U.S. economy.

Franchises are part of a small business sector that provides the majority of jobs in America – especially entry-level jobs for new and untrained workers.

Like the coffee vendor in the lobby of Trump Tower, they’re not global business magnates, they’re small business owners trying to make a living.

Seattle politicians should treat them as such.


More in Opinion

The Fennel Creek Trail will benefit nearby communities

Contrary to the beliefs of some, the increased number of people using trails discourages criminal activities by increasing the number of eyes watching what is going on.

The sweetest revenge? Sometimes it’s just being nice

Being kind to others, especially those who have harmed or hurt us, comes as a result of seeing others as our equals.

Mental health competency delays cost state millions

Soon, some of those languishing lengthy periods behind bars might need to be released and charges against them dismissed.

Thank you, Enumclaw, for all of your support

I’ve seen these types of things happening throughout my life in Enumclaw, but recently I have been overwhelmed with the outstanding amount of support the community has shown me personally as I prepare for an internship in Washington, D.C., this summer.

What’s new on Cole St? | Wally’s World

To begin, we have “Ann’s Fudge and Bakery,” which offers a wonderfully enticing selection of baked, creative confections.

The four cornerstones of arguing irrationally

Don’t get caught up in the techniques people use to ignore rational arguments.

State Dems may abandon caucus chaos in time for 2020

Washington also is considering becoming more significant by moving its primary to early March.

A taste of Krain history, from its dive-bar days

I first went in the place one winter’s evening when I was 8 or 9 years old.

Supreme Court resets the playing field

The ruling on the Masterpiece Bakery v. Colorado Civil Rights Commission case wasn’t a win for the right or a loss for the left; it’s a chance to do things right the second time around.

Supreme Court ruling shows sanity, moderation

The 14th Amendment equal protection clause does not negate the First Amendment religious freedom clause.

Initiative signatures are the new greenbacks

As of Wednesday, June 6, petitions for four statewide initiatives were getting circulated.

Public record battle brings in a mediator

A taskforce is also being put together, but it’s not clear who will be on it.