- Associated Press - Thursday, October 20, 2016

LOUISVILLE, Ky. (AP) - Louisville’s law gradually raising the minimum wage to $9 an hour was struck down Thursday by the Kentucky Supreme Court, which ruled that the city exceeded its home-rule authority by passing its own ordinance on the divisive state issue.

In its 6-1 decision, the state’s high court declared the city’s ordinance “invalid and unenforceable.”

The court’s ruling also invalidates the minimum wage increased approved in Lexington, the state’s second-largest city.

Louisville was the first Kentucky city to increase minimum wages above the federal level of $7.25 an hour. The Louisville Metro Council decided in late 2014 to phase in the wage hikes in Kentucky’s largest city.

In July, the minimum wage in Louisville rose to $8.25 an hour under the ordinance and was scheduled to reach $9 per hour next July. Any increases beyond 2017 were to be tied to the Department of Labor’s Consumer Price Index for urban cities in the region.

The Kentucky Center for Economic Policy, which favored the increase, estimated that the eventual $9-an-hour minimum wage rate would have affected about 45,000 workers citywide. An estimated 31,000 would have benefited from Lexington’s even higher minimum wage.

Jason Bailey, executive director of the Kentucky Center for Economic Policy, called Thursday’s court ruling “a big setback” for tens of thousands of Kentuckians struggling to get by on low wages.

Louisville Mayor Greg Fischer said he was disappointed with the ruling, but said the fight for a higher minimum wage will continue.

“It’s just critical that the state legislature changes the laws, so working people can make a decent living,” he said.

Under state law, Kentucky’s minimum wage is $7.25 an hour, matching the federal rate. Efforts by the Democratic majority in the House to gradually raise the statewide rate to $10.10 an hour have been blocked by Senate Republicans.

House Speaker Greg Stumbo said the court’s ruling Thursday reinforces the need for state lawmakers to raise the minimum wage.

“Seven-plus years is too long for families who are struggling to get by,” he said.

Louisville’s ordinance was challenged by the Kentucky Restaurant Association, the Kentucky Retail Federation and a local employer, Packaging Unlimited. The groups lost a preliminary round in Jefferson County Circuit Court.

The ordinance’s opponents said the Supreme Court ruling sets important boundaries on Kentucky’s home-rule law for cities.

“Employers can rest assured knowing localities cannot devise a patchwork quilt of employment laws,” Kentucky Retail Federation President Tod Griffin said in a statement.

Writing for the Supreme Court’s majority on Thursday, Justice Bill Cunningham noted that local governments in Kentucky wield broad authority under the concept known as “home rule,” but he said “the sovereignty of the state still rules supreme.”

“The ordinance at issue here requires businesses to pay workers a higher wage than the statutory minimum,” Cunningham wrote. “In other words, what the statue makes legal, the ordinance makes illegal and, thus, prohibits what the statute expressly permits.”

“This is precisely the type of ‘conflict’ that is forbidden” under Kentucky’s Constitution and state law, he added. “Therefore, the ordinance is invalid unless additional statutory authority permits municipalities to raise the minimum wage.”

Justice Samuel T. Wright III dissented, saying he found no conflict between the ordinance and existing minimum wage laws.

“The General Assembly granted extraordinary powers to Louisville Metro because the state body could not adequately address its concerns,” Wright wrote. “Minimum wages within Kentucky’s only first-class city is the type of issue contemplated by that exceptional grant of authority.”

In Lexington, the Urban County Council voted in late 2015 to raise the citywide minimum wage in phases to $10.10 an hour by 2018.

“This opinion effectively prevents cities, including Lexington, from increasing the minimum wage. Lexington’s local minimum wage ordinance has been invalidated,” said Susan Straub, a spokeswoman for the city.


Associated Press Writer Adam Beam in Frankfort, Ky., contributed to this report.

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