The Kentucky Supreme Court has struck down Louisville’s minimum wage ordinance in a 6-1 decision, saying that the city doesn’t have the authority to set a minimum wage above the level set by the state.
Passed in 2014, the Louisville ordinance would have gradually raised the minimum wage to $9 an hour by July 2017. The rate was bumped to $7.75 an hour in 2015, and increased to $8.25 an hour starting July 1 of this year.
The majority opinion, written by Justice Bill Cunningham, said that businesses can’t be required to pay workers a higher wage than the minimum set by the state.
“In other words, what the statute makes legal, the Ordinance makes illegal and, thus, prohibits what the statute expressly permits,” Cunningham wrote in the opinion.
The Kentucky Restaurant Association and the Kentucky Retail Federation sued Louisville over the ordinance, saying that as a local government, Louisville can’t violate a “comprehensive scheme” of state employment laws by raising the minimum wage.
A Jefferson Circuit Court judge ruled the city could raise the minimum wage, but the business organizations appealed the case to the state Supreme Court.
Jason Bailey, executive director of the Kentucky Center for Economic Policy, called the ruling a “big setback for the tens of thousands of hard working, low wage Kentucky workers scheduled to get much-needed raises that would boost their families and local economies.”
“It is now up to the General Assembly to take action when they next meet to correct this injustice and ensure more Kentuckians who work can meet their basic needs,” Bailey said.
The Democratic-led state House of Representatives passed a minimum wage hike during the last two legislative sessions, but the bill has been a non-starter in the Republican-led Senate.
The bill would have increased the minimum wage Kentucky businesses could pay employees from $7.25 to $10.10 over the course of three years.
In a dissenting opinion, Justice Sam Wright said he saw no conflict between the ordinance and existing minimum wage laws.
“The language establishing a minimum wage does not, as the majority asserts, amount to something expressly permitted by the statute being prohibited by the ordinance,” Wright wrote.
“The statute requires an employer to pay a wage of "not less than" the amount set by statute. This statute was passed to protect workers from being paid a lesser wage. The majority's view is that the statute expressly permitted the employer to pay the minimum. This reading of the statute requires a view that it was passed to protect the employer. The majority's conclusion is inconsistent with the purpose of the statute and its history. There is simply no conflict between the two laws.”
The Lexington City Council also voted to raise its minimum wage last year to $10.10 an hour by July 2018.
