Retailers Expected To Challenge 'Big Box' Ordinance
Mega-retailers, such as Wal-Mart Stores Inc. and Target Corp., might be headed to court after the Chicago City Council passed a controversial wage ordinance July 26. In a 35 to 14 vote, the City Council overwhelming passed a "big-box" living-wage ordinance. The ordinance requires stores of at least 90,000 square...
July 28, 2006 at 07:38 AM
2 minute read
The original version of this story was published on Law.com
Mega-retailers, such as Wal-Mart Stores Inc. and Target Corp., might be headed to court after the Chicago City Council passed a controversial wage ordinance July 26.
In a 35 to 14 vote, the City Council overwhelming passed a “big-box” living-wage ordinance. The ordinance requires stores of at least 90,000 square feet operated by firms with $1 billion or more in annual sales to pay employees a minimum of $9.25 an hour in wages and $1.50 in benefits. By 2010, these figures will rise to $10 an hour in wages and $3 in benefits, according to the legislation.
Although no formal suit has been filed, companies, such as Wal-Mart, and trade organizations, such as the Illinois Retail Merchants Association, are expected to challenge the legislation in court. Legal experts predict that the suits will be brought under the equal protection clause of the 14th Amendment, citing that the legislation unfairly singles out the retailers.
Other cities have passed similar living-wage ordinances, including Santa Fe, N.M. and San Francisco. However, Santa Fe's law is much broader, applying to firms that employ more than 25 people while San Francisco's law applies only to businesses that have government contracts.
Chicago's “big-box” ordinance is scheduled to take effect next July and will affect an estimated 38 stores in the city.
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