The Minnesota Chamber of Commerce and two other entities that sued the city of Minneapolis last month over the plan to raise the minimum wage to $15 have now pulled out of the lawsuit.
The chamber initially filed the lawsuit in November, asking for a temporary injunction to stop the minimum wage from going into effect.
But the chamber withdrew its involvement on Thursday, along with the TwinWest Chamber of Commerce and the Minnesota Recruiting & Staffing Association. Only the northeast Minneapolis-based Graco Inc. remains in the lawsuit.
"The Minnesota Chamber of Commerce has decided not to pursue further legal action against the City of Minneapolis regarding its minimum wage ordinance," the chamber said in a statement. "Although the court's initial decision in this case created obstacles to this particular legal challenge, we believe a correct reading of the law would conclude that the ordinance remains unlawful by conflicting with state law."
Chamber officials said they intend to continue pushing for uniform labor standards at the Legislature and, if necessary, in the courts, "so that businesses spend less time complying with laws and more time innovating and creating jobs."
Graco spokesperson Charlotte Boyd said the company intends to continue the litigation "to preserve a flexible work environment and a vibrant business community in this state."
"A city mandating a minimum wage is a slippery slope; if this stands, then we have no ability to predict what the next mandate will be. Businesses cannot make informed long-term investment decisions in an uncertain environment," she said.
Minnesota Recruiting and Staffing officials said that despite ceasing their involvement, they believe the courts "will ultimately find that the City of Minneapolis minimum wage ordinance is pre-empted by existing state statutes." Representatives from the Twin West Chamber could not be immediately reached for comment.
Minneapolis City Attorney Susan Segal said with Graco still in the lawsuit, the case will proceed. "We will continue to defend the validity of the minimum wage ordinance," she said.
Minneapolis became the first Midwestern city to adopt a $15 minimum wage in June, when the City Council 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.
The chamber and other members of the business community fought Minneapolis' minimum wage ordinance when it was being developed and lamented its approval this summer. The argument at the time, which the chamber reiterated in its lawsuit, was that having minimum wage laws that vary by city would be burdensome for employers.
Minnesota's hourly minimum wage is $9.50 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.