FRANKFORT - The Kentucky Supreme Court ruled Louisville’s minimum wage ordinance unconstitutional because it conflicts with the state’s lower minimum wage law.
The ruling, issued last Thursday, also affects Lexington which also passed a minimum wage higher than the one mandated by state law.
Justice Bill Cunningham, writing for the 6-1 majority, said Section 156b of the Kentucky Constitution enables cities to pass their own laws but “proscribes any local ordinances being passed which are ‘in conflict with a constitutional provision or statute.’ ”
Justice Samuel T. Wright dissented, saying there is no conflict between the Louisville ordinance and state law which requires an employer to pay workers a wage “not less than” the state minimum wage.
Cunningham called the case an “historic clash between the competing authority of the Louisville-Jefferson County government and the Kentucky General Assembly.”
He said the local ordinance “requires employers to pay higher minimum wages than the statutory minimum,” but state law makes it legal for employers to pay only the state minimum wage.
“In other words what the statute makes legal, the Ordinance makes illegal . . .” Cunningham wrote. That’s precisely the conflict which is prohibited by Section 156b of the state constitution, he continued.
The court ruled local ordinance “is invalid” unless the General Assembly passes legislation providing local municipal governments the authority to set their own minimum wages.
Louisville Metro Government passed its local minimum wage ordinance in 2014, mandating incremental increases over three years. It went into effect in July.
Under that ordinance, Louisville workers are currently making $8.25 an hour and that would have risen to $9 an hour in July 2017. The state minimum wage is $7.25 an hour, matching the current federal minimum wage.
The ordinance was challenged in Jefferson Circuit Court by the Kentucky Restaurant Association, the Kentucky Retail Federation, and Packaging Unlimited. That court upheld the ordinance in its June 2015 ruling but the plaintiffs appealed the decision.
Lexington Urban Government also passed is own minimum wage ordinance in 2015 which would have ultimately raised the minimum wage in Fayette County to $10.10 an hour by 2018.
Democrats in Washington and Frankfort have pushed legislation to raise the minimum wage to $10.10 an hour but have been unable to persuade Republicans, business groups and some conservative Democrats that a higher minimum wage is needed and won’t lead to fewer jobs.
Joining Cunningham in the majority were Chief Justice John Minton, justices Mary Noble, Michelle Keller and Daniel Venters.
Justice Lisabeth Hughes issued her own concurring opinion noting the higher costs of living in urban areas like Louisville and Lexington and writing that the General Assembly could recognize minimum wage ordinances as part of home rule authority.
But unless or until the legislature does that, the local ordinances are in conflict with state law, she writes.
Restaurant Association President Stacy Roof said his organization is analyzing the written opinion but is pleased with the ruling.
“We’re please the court upheld the rule of law and agreed with our arguments that local governments cannot establish a minimum wage and recognize the comprehensive scheme of legislation that already exists in state law,” he said.
But the executive director of the Kentucky Center for Economic Policy said the ruling hurts low-wage workers.
“This ruling is 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,” said Jason Bailey. “An increase in our minimum wage is long overdue. 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.”