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National Restaurant Association - Restaurants fight wage increase

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Restaurants fight wage increase

The Kentucky Restaurant Association is reviewing its options to challenge the Louisville City Council’s recent passage of an increase in the city’s minimum wage from $7.25 to $9 over the next two years.

Even though Louisville Mayor Greg Fischer has said he’ll sign the increase, KRA, along with a coalition of groups representing other industries, maintains that the city council overstepped its authority. In the weeks leading up to the vote, they presented the council with opinions from several legislators and attorneys who said that state laws prohibit the city from raising its minimum wage beyond the state minimum, which is currently $7.25.

If the increase is allowed to take effect, many of the city’s restaurateurs are concerned that they’ll be forced them to raise prices, putting them at a disadvantage with competitors from nearby cities and the state of Indiana, which borders Louisville and has a $7.25 minimum wage, said Stacy Roof, KRA president and CEO. Nearly 200 of the city’s restaurateurs contacted city councilors to urge them to vote against an increase.

“I don’t think proponents of the increase care that [the city council] lacks the authority to do it,” Roof said. “They repeatedly ignored multiple opinions and warnings and proceeded down this path. I think it would have been more fiscally responsible to thoroughly investigate the issue.”

The state’s $2.13 minimum cash wage for tipped employees won’t be affected by the increase. The first stage of the increase, to $7.75, is scheduled to take effect in July.

Several members of the city council initially aimed to increase the city’s minimum wage to $10.10, but Fischer said he’d veto that increase out of concerns it would lead to job losses.

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