Reportedly due in part to the support franchise businesses receive through their wider franchise network, the latest Court ruling concerning Seattle’s minimum wage increase holds that franchisees are to increase employee pay at the same rates as “large employers” that maintain over 500 employees.
This decision prompts the IFA’s appealing the denial of a preliminary injunction request. The appeal will continue the push to realign the wage increase structure applied to franchise businesses of Seattle with that of small business counterparts to follow a more gradual timeframe to increase wages over the coming years.
Addressing how laws related to wage increases regard franchisees could also become relevant elsewhere. Depending on how franchise businesses fit into local laws that are currently under review, this particular case could be of concern on a wider scale. As more cities in various states as well as federal level laws take up minimum wage increase agendas, franchise businesses may have to contend with not only the increases themselves but also the implementation of pay scale timeframes applied to various different business structures depending on size and type.
One of several other cities working to implement wage changes, San Francisco also passed a wage increase that will begin on May 1 and gradually increase to $15.00 per hour by year 2018. The increase will apply to all employers, regardless of the number of employees, and will follow with cost of living increases for qualifying employees.
Meanwhile, as employee wage issues rage on and debates continue regarding how franchise businesses fit into the pay structure set out by Seattle and potentially other cities, franchising continues to boost the overall economy and drive job creation.
Just last month, ADP reported franchise businesses contributed over 20,000 jobs to the economy, which is a figure that exceeds the overall increase over the last 12 month period. The sector primarily responsible for this uptick, contributing over 13.5K jobs, is that of auto parts and dealers franchises. This marks a 1.1% month over month increase for the sector that is continuing to see upward demand as drivers keep cars longer and seek professional assistance for automotive maintenance and repairs.