Minimum Wage Debate Heats Up

The recent move by New York to a statewide minimum of $15 for fast-food workers raises concerns.

SPONSOREDUpdated 12:12PM • 09/14/15

New York Gov. Andrew Cuomo recently approved a state board's recommendation for a statewide $15 minimum wage for fast-food workers. The move comes as many employees and employers are at odds over what the minimum pay should be for workers.

The wage hike for fast-food workers in New York will be phased over three years in New York City and over six years for the rest of the state.

New York is the first state in the nation to adopt a $15 minimum wage. Los Angeles, Seattle, San Francisco and the California cities of Oakland and Berkeley have also approved a phased-in increase to take their minimum wage to $15 an hour.

Proponents of the wage increase say this would help struggling families and stimulate the economy. The issue is a big part of the 2016 presidential debate. According to U.S. News and World Report, Democratic presidential contenders Sen. Bernie Sanders of Vermont and former Maryland Gov. Martin O'Malley have both backed a $15 federal rate, while former Secretary of State Hillary Clinton prefers $12.

Meanwhile, leading GOP candidate Donald Trump told MSNBC in late August that "having a low minimum wage is not a bad thing for this country."

"We can't have a situation where our labor is so much more expensive than other countries that we can no longer compete," the billionaire businessman said. "It's such a nasty question because the answer has to be nasty."

While the $15 minimum wage increase in New York may be a win for labor unions and fast-food workers, the acceptance of a $15 minimum wage is facing sharp opposition from some industry leaders and employers over the implementation and the benefits of the law. Many fear that the raise in the minimum wage would have a negative impact on employers, especially small businesses and franchises.

In an opinion piece in The Wall Street Journal, Andy Puzder, CEO of CKE Restaurants, talked about how Stephen Bronars of Edgewood Economics crunched the minimum wage numbers for the Seattle, Los Angeles and San Francisco markets.

According to The Wall Street Journal, Bronars found that the “first wave of minimum wage increases appears to have led to the loss of over 1,100 food service jobs in the Seattle metro division and over 2,500 restaurant jobs in the San Francisco metro division.”

In an interview with FOX Business, Steve Caldeira, the CEO of the International Franchise Association, spoke about the discriminatory practices of the $15 minimum wage phase-in as it relates to franchising. In Seattle, non-franchise restaurants have seven years to raise the minimum wage to $15 while franchised restaurants only have three years to comply.

That’s why the IFA is suing the city of Seattle and presented oral arguments in the U.S. 9th circuit court of appeals. According to Caldeira and the IFA, the ruling in Seattle is “a violation of the Commerce Clause of the United States, the Equal Protection Clause and the Washington State Bill of Rights.”

As presidential candidates, industry leaders, unions and workers continue to debate the increase in minimum wage, there is sure to be many more points of view to consider.