A Hennepin District judge ruled that the city of Minneapolis' $15 minimum wage ordinance is valid, ending the first major legal challenge of the plan since it passed in June.
Graco Inc. was the only remaining plaintiff in the lawsuit, which was filed in November and sought a temporary injunction to stop the ordinance from going into effect. The Minnesota Chamber of Commerce pulled out of the suit in late December.
On Tuesday, Judge Susan Burke ruled that the Minnesota Fair Labor Standards Act, the state minimum wage law, doesn't preclude municipalities from passing local wage ordinances to meet the needs of their communities.
Besides denying the injunction, Burke ordered Graco to pay the city's administrative court costs.
"This is an important decision to employers and employees, as well as to the citizens and the city of Minneapolis," Burke wrote. "The decision is driven by law, which requires the court to consider identified factors to determine whether the ordinance conflicts with or is pre-empted by state law."
Minneapolis became the first Midwestern city to adopt a $15 minimum wage, when the City Council last year approved an ordinance that phases in the wage hike over several years. Other cities across the country, including Seattle, San Francisco and Washington, D.C., have also adopted a $15 minimum wage, and St. Paul leaders are considering doing the same.
"This landmark decision sets an important precedent, solidifies Minneapolis as a laboratory of democracy, and is a big win for workers," said Mayor Jacob Frey. "I applaud our City Attorney's office for their excellent defense and legal work."
The chamber and other members of the business community fought the ordinance when it was being developed and lamented its approval. The chamber argued that minimum wage laws that vary city by city would be burdensome for employers.
Minnesota's hourly minimum wage is $9.65 for large employers — those with annual gross revenue of $500,000 a year or more — and $7.75 for small employers. Those rates will rise with inflation in 2018.
Under the Minneapolis ordinance, large businesses — those with 100 or more employees — must phase in the $15 minimum wage by July 1, 2022. Small businesses have until July 1, 2024.
In December, Graco spokesperson Charlotte Boyd told the Star Tribune that the company, which makes industrial fluids and coatings, intended to continue the litigation "to preserve a flexible work environment and a vibrant business community in this state."
City Attorney Susan Segal said the court's decision affirmed the authority of the city to address local needs.
"In this case, by providing a minimum wage more in tune with costs of living in an urban center and that will promote the health and well-being of city workers through a more livable wage," she said.