2015.10.23 iba petition
TRANSCRIPT
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STATE
OF
NEW
YORK
INDUSTRIAL
BOARDOFAPPEALS
----- -
x
I n
t h e
M a t t e r of h e
P e t i t i o n
o f :
NATIONAL
RESTAURANT
ASSOCIATION,
P e t i t i o n e r
To review under
S e c t i o n
657
of
h e
Labor L a w :
Order
on h e
Report
and
Recommendati on of
h e
2015
F a s t Food Wage
oard,
a t e d
September 1 0 2015,
-
a g a i n s t -
THECOMMISSIONEROF
LABOR,
Respondent.
x
NATIONAL
RESTAURANT
ASSOCIATION S
PETITION
FORREVIEW
OF
THE
COMMISSIONEROF
LABOR SSEPTEMBER
0, 015
ORDERON THE
REPORT
AND RECOMMENDATIONS OF
THE
015 FASTFOOD
WAGEBOARD
N a t i o n a l R e s t a u r a n t
A s s o c i a t i o n
2055
L
t r e e t
NW, u i t e
700
Washington,DC
0036
202) 31
-5900
P e t i t i o n e r
New
ork,
New
or k
October
23,
2015
R a n dy M. astro
Nancy E.
art
G a b r i e l K.
i l l e t t
GIBSON,
I.TNN
RUTCHERLLP
200 Park
A v e n u e
New
ork,
NY
0166
212)
51-4000
Thoma s H . u p r e e,
r
not
d m i t t e d t o
p r a c t i c e
i n New ork)
GIBSON,
i.JNN
RUTCHERLLP
1050
C o n n e c t i c u t
Av e nue ,
N.W.
Washington,
DC
0036
202)
55
-8500
A t t o r n e y sfor e t i t i o n e r
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TABLEOF
CONTENTS
Pa e s
PRELIMINARYSTATEMENT
1
P A R T I E S
1
FACTUALBACKGROUND
I The
L e g i s l a t u r e
R a i s e s
t h e
Minimum
Wage n 2013,
and
R e j e c t s
R a i s i n g i t
Againin
2016
I I
The
Labor
Commissioner Empanels a Wage Board
t o Circumvent h e
L e g i s l a t u r e s
D e c i s i o n
Not
o R a i s e
t h e Minimum Wage gain
4
I I I
At h e
Lab or Commissioner s
D i r e c t i o n ,
t h e
Board Recommends
R a i s i n g
Wages
o r
Only
a
Subset
of
h e
I n d u s t r y ,
D e s p i t e
Relying on
n d u s t r y w i d e
E v i d e n c e
5
IV.
The
Labor
Commissioner
D i s r e g a r d s P u b l i c
Concerns and Adopts h e Board s
Reportin
F u l l
7
A R G U M E N T
7
I The
Board was
Improperly C o n s t i t u t e d
7
I I
The
Labor
Commissioner s
Order
V i o l a t e s t h e S e p a r a t i o n - o f -Powers D o c t r i n e . . . . . . . . .
10
I I I
The
Order
s
C o n t r a r y t o t h e New
ork Labor Law
14
A . The Order
m p r o p e r l y
f o c u s e s
on employers f f i l i a t e d
w i t h
c h a i n s
w i t h
more
than
h i r t y
l o c a t i o n s ,
n o t
on
an o c c u p a t i o n o r i n d u s t r y
14
B. The
Order does n o t
a d e q u a t e l y
a n a l y z e t h e
Labor
Law s
x c l u s i v e
employee-focused
f a c t o r s
f o r when o r a i s e wages
17
IV.
The Order
s
A r b i t r a r y and C a p r i c i o u s
and
Not
Supported by h e Evidence
18
V. The
Order
V i o l a t e s
t h e
U.S.
o n s t i t u t i o n
19
A . The
Order runs
a f o u l of h e Dormant
Commer ce
C l a u s e , and t h e F i r s t
and
FourteenthAmendments
19
B .
The a i l u r e
t o
d i s c l o s e t h e r e c o r d u n d e r l y i n g t h e Report and
Order v i o l a t e s
proceduraldue
p r o c e s s
21
C O N C L U S I O N
2 4
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PRELIMINARY
STATEMENT
The
n d u s t r i a l Board
of
ppeals h o u l d s e t
a s i d e t h e Labor Commissioner's
Order
d o p t i n g t h e Report
of h e F a s t
Food Wage Board,
which
r e co m me nd s a i s i n g t h e s t a t e
m i n i m u m wage
by
almost
70%
s
of
ecember
31,
015, o $15
p e r
h o u r ,
s o l e l y f o r
w o r k e r s a t
f a s t food c h a i n s
w i t h a t
l e a s t
3 0 1 o c a t i o n s
n a t i o n a l l y . The
Wage
o a r d s Report and h e
Labor
Commissioner's
O r d e r , which
d o p t s
t h e Report
n f u l l , a r e t h i n l y v e i l e d a t t e m p t s by
Governor
C u o m o
and h i s
a p p o i n t e e s t o
maneuver around
an n w i l l i n g L e g i s l a t u r e
and o e n a c t
t h e i r
o w n
p o l i c y
c h o i c e s . New
ork's o b u s t
s e p a r a t i o n
- o f -powers
o c t r i n e , however, oes o t
a l l o w
f o r
such
b l a t a n t
e x e c u t i v e o v e r r e a c h .
2 . The
Report and
Order r e
a l s o
a r b i t r a r y ,
c a p r i c i o u s , and
c o n t r a r y
t o
law
b e c a u s e
t h e y
do
o t
comp ly w i t h t h e
Labor L a w ' s i r e c t i v e t o
f o c u s
on h e employee, r i t s
mandate
o
c o n s i d e r o n l y t h r e e
s t a t u t o r y c r i t e r i
i n
s e t t i n g
a
m i n i m u m wage o r a a r t i c u l a r
o c c u p a t i o n .
The
Labor Law
l a i n l y does not
r a n t
t h e
Labor
Co mmis s io ner u t h o r i t y
t o
f o c u s o n h e
e m p l o y e r ,
o r
t o t a r g e t
o n l y a u b s e t
of
i n g l e i n d u s t r y .
3 .
A d d i t i o n a l l y , t h e
Labor Commissioner's
Order w i l l b r i n g
h a r s h ,
sweeping
c o n s e q u e n c e s :
t h e
w e i g h t of u t h o r i t y
shows
h a t
s m a l l
b u s i n e s s e s
t h r o u g h o u t t h i s
s t a t e -
i n c l u d i n g
f r a n c h i s e s
o w ne d
by
w o m e n and m i n o r i t i e s
- w i l l h i r e fewer
w o r k e r s ,
be o r c e d t o
i n c r e a s e
p r i c e s , r e l y
o n
g r e a t e r
a u t o m a t i o n , o r s h u t
d o w n n t i r e l y . I n
t h e
end,
t
w i l l
be
h e s e
s m a l l b u s i n e s s
owners
and
h e i r
employees
c r o s s t h e s t a t e w h o
w i l l
s u f f e r , a l o n g w i t h
t h e m a n y
m i l l i o n s of
onsumers w h o
w i l l be o r c e d
t o pay
h i g h e r
p r i c e s .
A c c o r d i n g l y ,
h e Labor
Commission er's Order
must
be
a n n u l l e d .
PARTIES
4 .
The
a t i o n a l
R e s t a u r a n t
A s s o c i a t i o n
NRA
) s
t h e
l a r g e s t f o o d s e r v i c e t r a d e
a s s o c i a t i o n i n
t h e
w o r l d by
membership,
u p p o r t i n g o v e r 500,000 a t i n g
and
r i n k i n g
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e s t a b l i s h m e n t s
i n t h e
U n i t e d
S t a t e s
w i t h
t h o u s a n d s
of h o s e e s t a b l i s h m e n t s l o c a t e d
i n
New
ork.
The
NRA d v o c a t e s
f o r f o o d s e r v i c e
i n d u s t r y
i n t e r e s t s on
b e h a l f
of
t s
members.
5 .
The
NRA's members n c l u d e
employers who r e a g g r i e v e d
by h e
Order of
A c t i n g
Commissioner of
abor
Mario
.
Musolino
on h e
Report
and
Recommendations of h e
2015
F a s t
Food
Wage
Board, a t e d
September 1 0 , 2015 t h e
Order ) ,
which
a d o p t e d t h e
R e p o r t
of
h e
F a s t
Food
Wage Board o
t h e NYS
ommissioner of
abor,
a t e d
J u l y 31,
015
t h e
Report ) . See
Labor
Law
§ 657.
The Order and Report
r e a t t a c h e d a s E x h i b i t s A
nd
B ,
r e s p e c t i v e l y ,
t o
t h e
accompanying
A f f i d a v i t of
Randy
M
astro
Mastro
A f f . ) .
The NRA
t h e r e f o r e has
t a n d i n g t o b r i n g
t h i s
p e t i t i o n
b e c a u s e
i t
i s
an employer
a s s o c i a t i o n r e p r e s e n t i n g
employers
a g g r i e v e d
by h i s
O r d e r .
See
Labor
Law §
657.
6 .
The
New
ork S t a t e Department
of
abor
s t h e s t a t e agency h a t r e g u l a t e s
l a b o r
and
employment
n New ork
S t a t e ,
i n c l u d i n g s t a t e
m in i m um wage
a w s .
7 .
Mario
.
Musolino
s
A c t i n g
Commissioner of h e Department
of abor and
i s s u e d t h e
Order
d o p t i n g
t h e
Wage
B o a r d ' s
recommendations.
FACTUALBACKGROUND
I . The
e g i s l a t u r e
R a i s e s
the Minimum Wage
n
2013,
nd R e j e c t s Raising t Again
i n
2016.
8 .
On arch 29, 013,
h e S t a t e L e g i s l a t u r e amended
h e Labor
Law
o
g r a d u a l l y
r a i s e t h e
h o u r l y
m in i m um wage
o r a l l
workers
by
$ 1 . 7 5 o v e r
t h r e e y e a r s .
The
m in i m um
wage
was c h e d u l e d t o
i n c r e a s e
by
0 . 8 5 , o
$ 8 . 0 0 ,
a s of ecember 31, 2013; by
a n o t h e r
$ 0 . 7 5 , o
$ 8 . 7 5 , a s
of
ecember 31, 2014; and
a n o t h e r
$ 0 . 2 5 ,
o
$ 9 . 0 0 ,
a s of
ecember 31, 2015. 2013
N.Y.
Laws
290,
Ch. 57,
t .P§ (Mar. 29,
0 1 3 ) .
9 .
The
m in i m um wage n c r e a s e ,
e n a c t e d
a s p a r t
of h e 2013
-2014 t a t e
b u d g e t ,
wa s
t h e
s u b j e c t
of
u b s t a n t i a l p u b l i c
d e b a t e ,
v i g o r o u s
l o b b y i n g
from
b o t h
s i d e s , and
t h e
r e s u l t
of
2
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p o l i t i c a l
compromise
between
R e p u b l i c a n s and
Democrats
n t h e L e g i s l a t u r e ,
and
Governor
Andrew
Cuomo.
S e e , e . g . ,
Joseph S p e c t o r and
J e s s i c a Bakerman, ssembly To
i n a l i z e Budget
A mi d Discord,
oughkeepsie
J o u r n a l
(Mar.
9,
013);
r i k
K r i s s , Min. Wage
Sweetener
Gov's
45MTax
`Quid Pro Quo'
or GOP,
ew
ork
Post
Mar.
9,
013); Adam ichko,
Minimum
Wage
Hike Propels
NY o No.
2,
Albany
B u s i n e s s Review Mar. 29, 013).
1 0 .
P u r s u a n t t o h i s a u t h o r i t y
under h e S t a t e
C o n s t i t u t i o n , N.Y. o n s t .
a r t
VII §§
2
3 ,
Governor Cuomo's 2 0 15
-2016 budget
e g i s l a t i o n f o r m a l l y
proposed
r a i s i n g
t h e
minimum
wage
a g a i n ,
o
11.50
o r
New
ork
C i t y
and o
10.50
o r t h e r e s t
of h e s t a t e , as of ecember 31 ,
2016. See
2 0 15
-2016 New
ork
S t a t e
E x e c u t i v e
Budget,
d u c a t i o n ,
Labor,
nd
Family
A s s i s t a n c e A r t i c l e
VII
e g i s l a t i o n , L e g i s l a t i v e B i l l
D r a f t i n g Comm'n o. 12572
- 0 1 - 5 ,
p t . N, t
3 1 0
J a n .
20, 015).
1 1 . As
i t h t h e p r i o r
minimum wage n c r e a s e , t h e
p r o p o s a l
was h e
s u b j e c t
of
s u b s t a n t i a l p u b l i c
d e b a t e
and
v i g o r o u s
l o b b y i n g from b o t h s i d e s . S e e , e . g . ,
Matthew Danerman,
Cuomo ontinues
Pushing Minimum
Wage
n c r e a s e ,
R o c h e s t e r Democrat &Chronicl e
Mar. 4 ,
2015); Matthew
Hamilton, Minimum
Wage Impact O u t l i n e d , The
Times
-Union(Mar. 0 , 2015);
Robert .
McCarthy,
Cuomo
a l l s
For Higher
Minimum Wage,
The B u f f a l o News
Mar.
,
2015).
1 2 . The
e g i s l a t u r e and h e
Governor o u l d n o t
r e a c h agreement on
a r o p o s a l t o
i n c r e a s e t h e
minimum w a g e
g a i n . As
overnor
Cuomo
onceded, t h e L e g i s l a t u r e
r e j e c t e d
t h a t
p r o p o s a l .
Gov. Andrew M.
uomo,
Op-Ed,Fast
F oo d
Workers Deserve A
a i s e ,
The
New
York Times(May
,
015).
3
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I I .
The
Labor
Commissioner
Empanels
a Wage oard o Circumvent the e g i s l a t u r e ' s
Decision
Not
o Raise the
Minimum
Wage gain.
13.
Governor
Cuomo owed o p r e s s on, e s p i t e t h e L e g i s l a t u r e ' s
r e j e c t i o n of i s
p r o p o s a l :
I am
o n t i n u i n g t h e
f i g h t .
While lawmakers
e l a y ,
I
am
a k i n g
a c t i o n .
I d .
14. On
May ,
015,
overnor
Cuomo i n s t r u c t e d
Acting S t a t e
Labor Commissioner
Mario
.
Musolino
o
empanel
a
Wage Board h a t w i l l
i n v e s t i g a t e
and
make
recommendations on
an
n c r e a s e i n
t h e
minimum
wage
n t h e
f a s t
food
n d u s t r y . Dept
f abor,
r e s s R e l e a s e ,
Governor
Cuomo n s t r u c t s
S t a t e
Labor
Department
o
Convene Wage
Board
o I n v e s t i g a t e
an d
Make Recommendations
on Raising
Minimum Wage
or
Fast
ood
Workers
(May
,
015).
The
recommendations
of
a wage board,
h e
Governor o t e d ,
do not
e q u i r e
l e g i s l a t i v e a p p r o v a l .
Cuomo,Op-Ed, upra.
1 5 .
That same day,
o l l o w i n g t h e
Governor's
n s t r u c t i o n , Labor
Commissioner
Musolino
appointed a
wage board
o i n q u i r e
i n t o
and
e p o r t
and
recommend adequate
minimum
wages
and e g u l a t i o n s f o r
f a s t
food workers. Mastro A f f . Ex.
C,
ommissioner Musolino,
Determination
Regarding
h e
Adequacy of
ages
(May ,
0 1 5 )
Determination )
Commissioner
Musolino
e f i n e d
f a s t
food workers
s
those workers
who
r e p a r e
food
and
s e r v e customers
n l i m i t e d s e r v i c e r e s t a u r a n t s ,
where
customers
r d e r a t t h e c o u n t e r and
pay
n
advance.
I d .
16.
Commissioner
Musolino announced
h a t [ t ] h e Wage oard members i l l be
Byron
Brown, ayor of u f f a l o ,
r e p r e s e n t i n g t h e p u b l i c ;
Kevin
Ryan,
hairman
and
Founder of
G i l t ,
MongoDB,
usiness
n s i d e r and Zola and Vice Chairman
of
h e P a r t n e r s h i p f o r New
ork
C i t y ,
r e p r e s e n t i n g b u s i n e s s e s ;
and
Mike
Fishman, e c r e t a r y -T r e a s u r e r of h e S e r v i c e Employees
I n t e r n a t i o n a l Union,
e p r e s e n t i n g l a b o r .
Dept
f
abor,
r e s s
R e l e a s e ,
supra.
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1 7 .
Co
mmissioner
M
usolino d i d
n o t
s t a t e i n
t
h e
D e t e r m i n a t
i o n o r
o t h e r
w i s e , how
he
h
ad s e l e c t e d t h e
s e
p
e r s o n s t o
a p p o i n t
a s ] h e me mb
e r s
of
h e b o a r d , i n c
l u d i n g
w h e t h e r t h e
m e mb
e r s
were
s e l e c t e
d so
a r
a s p r
a c t i c a b l e from
n o m i n a t
i o n s
s u b m i t t e d by employers
and
emplo
yees
in
h e a
f f e c t e d
i n d u
s t r y .
Labor
La
w §
5 5 ( 1 ) .
I I I .
At
th
e
L a b o r Commis
sioner's D i r e c t i o n
, h e
Board Recomm
ends a i
s i n g
Wa ge s
o r
O
nly
a
Su
bset of th
e Industry,
e s p i t e
Relyin
g
o n
Industryw
ide Evide
nce.
1 8 .
At
h e
Wage B
oard's i r s
t
m
e e t i n g ,
Commissi
oner
Musolino
u
n i l a t e r a l l y
narrowed t h e
s c o p e
of h e Wage
o a r d ' s r e v i e w
from t h
e
f a s t
food i n d u s t r
y
g e n e r a l
l y
t o
o n l y
t h a t segment
of h e h o s p i t a l
i t y
i n d u s t
r y c o m m
only
e f e r r e d t o [ a s ]
a
s t food c h a i n s .
Ma
stro
A
f f .
Ex.
D
ommissioner
of
abor, Opening
S t a t e
m e n t
and Char
ge t o
t
h e 2015 F a s t Food
Wage
Board
a t 1 (emphasi
s add
ed)
Ch
arge ) .
Th e Commissio
ner
d e f i n e d f a s t
foo
d
c h a i n s
a s
l i m i t e d
s e r v i c e
r e s t a u r a n t s ,
where
c u s t o m e r s
o r d e
r a t
t h e
c o u n
t e r
a
nd pay i n
a d v
a n c e ,
w
hich a r e
l a r g e
c h a i n s
w i t
h m u l
t i p l e l o c a t i o n
s n a t i o n a l
l y .
I
d .
H
e l s o
c h a r g e
[ d ]
h e
Board
t o
p r o v
i d e
us
w i t h an
u n d e r s t a n d i n
g
of
what
m i n i m u m wage means
n t o d a y ' s f
a s t f
ood
i n d u s t r y .
I d .
a
t
3 .
1 9 .
D e s p i t e
s h i f t i n g
t h e
Wage
o a r d ' s
f o c u s
fro
m
l l
f a s
t
food
workers o w o r k e r s
a t f a s t food c h a i n s ,
t h e Comm
issioner's
c h a r g e
n o n e t h e l e s
s r
e l i e d
o n
e s e a r c h t h a t
a n a l y z e
d
a l l
ew or
k a s t fo
od
w o r k e r s ,
n o
t
o
n l y
t h o s
e
workin
g a t
c h
a i n
r e s t a u r a
n t s . See
2 0 .
The
Commiss
ioner
d i r e
c t e d
t h e Board
t o
m a k e t s
recommend
ation
b
y
c o n s i d e r i
n g t h e t h r e
e f a c t o r
s
enumerate
d i n t h e
Labor
L a w : ` t h e
wage
b o a r d
and
t
h e
commission
er h a l l c o n s i d
e r
]
the am
ount
u f f i c i e n t t o
p r o v i
d e
a d
e q u a t e m a i n
t e n a n c e
and
t o
p r o t e c t
h e a l
t h a n d , n a d d
i t i o n , t h e
wage
b o a r d and
t
h e commissioner
s h a l l c o n s i d e r
[2] h e
v
a l u e
of h
e w or k o r
c l a
s s i f i c a t i o n of wor k p
e r f o r m e d , an
d [3] h e
w
ages
p a i d i n t h e s t a t
e f o r wor k of
l i k e
o
r compara
ble c h a r a c t e r .
'
d .
( q u o t i
n g
Lab
or
La
w §
5 4 ) .
He
l s o t o l d t h e
Board
t h a t
t h e
purpose of
t
h e
La
bor
Law's]
t a t u
t o r y
scheme
s
t o
e l i m i n a t e ,
a s r a p i d l y
a s
p
r a c t i c a b l e , w
i t h o u t
-
8/20/2019 2015.10.23 IBA Petition
8/26
s u b s t a
n t i a l l y
c u r t a i l i
n g
o p p o r t u n i
t i e s
f o r
emplo
yment
r
e a r n i n g
power, h e
employment
of
p e r
s o n s
i n
o c c u p a
t i o n s i n
t h e
s t a t e ofNew
ork t
wages
n s u f f i c i e n
t t o p r o v i d e
a d e q
u a t e
m a i n t e n a
n c e f o r t h e m s
e l v e s and
h e i r
f a m i l i
e s . I d .
(
c i t i n g Labor
aw§
5
0 ) .
2 1 .
The Boa
rd m
et
i g h t t i m
e s ,
i n c l u d
i n g
a t
f o u r
h e a r i n g s wh
ere
member
s
of
h e
p u b l
i c
t e s t i f i e d Rep ort
t 3 . The Boar
d
h e a r d
from
225
p e o p l e ,
r e c e i v e d
o v e r 2,000
r i t t
e n
c
omments
and s u b m i
s s i o n s , a
nd r e v i e
w e d a a r i e t y
o
f
t u d i e s . I d . a t
- 7 .
2 2 . At h e h e
a r i n g s , s m a l
l b u s i n e s s
owners e s t i f i e d
t h a
t
r a i s i n g
t
h e
minimum
w
age
would f o r c e
the
m
o c u t
empl
oyees' o u r s
and
r
e d u c e emp
loyment,
r a m a t i c a
l l y
r a i s e
t h e i r
p r i c e s ,
and
e o p a r d i z e
t h e i r
b u s i n e s s e s .
F a s t
food
i n d u s t r y
e x p e r t s
r e i n f o r c e d
t h a t
t e s t i m o n y ,
e x p l
a i n i n g
t h a t r a i s i n g
t h e
minimum
wage
a u s
e s e
mployers o
r e d u c e
employment
, o
r a i s e
p r i c e s ,
and
o e a r n
l
ower
ma r
gins
h a t
t h r e a t e n
t h e
v i a
b i l i t y
of h e
b u s i n
e s s .
2 3 .
T
he
W
age B
oard r e l e a s e d
t s Report
on
u l y 31
, 015.
The Board
recom
mend[ed]
h a t t h e mi
nimum w a
ge
be
a i s e d t o
$15 o r f a s t foo
d
employee
s n f a s t
food
e
s t a b l i s h m e n t s
. I d . a t 20. o
c c o
m p l i s h
t h i s
t h e
Board
recommended
a i s
i n g t h e minimu
m
w age n
Ne
w o
rk C i t y by $1 .50
p e r h o u r ,
on
December 31 i n 201
5, 016,
2
017,
a
nd
2018.
I t
recom
mended a i s i n
g
t h e
minimum
w ag
e
more
g r
a d u a l l y
o u t s i
d e
New
ork
C i t
y , t o
r e a c h
$1
5
on J u l y
1 ,
2021. I d .
2 4 .
The Board d e f i
n e d a F a s t
Food
E s
t a b l i s h m e n t
a s
any
s t a
b l i s h m e n t
i n
t h e
s t a t e
of
N
ew
ork:
a)
which h a
s
a s
t s p r i m a r y p
u r p o s e s e r v i n g
food
o r
d r i n k i t e m
s :
(b )
h
ere
p a t r o n s o r d e r
o r
s e l e c t
i t e m s
and pay
b e f o r e
e a t i n g
and
such
i t e m s may
be
consum ed
on
h e
p
r e m i s e s , t a k e n
o u t , o r d e l i
v e r e d
t o
t h e c u s t o m e r ' s
l o
c a t i o n ;
(c)
hich
o
f f e r s l i m i t e d
s e r v i c e ;
(d
)
wh
ich s
p a r t of
h
a i n ;
an
d
(
e)
wh
ich
s
one
of
h i r t y ( 3
0 )
r
more
s t a b l i s h m e n
t s
n a t
i o n a l l y ,
i n c l u d i n g : i ) an n
t e g r a t e d
e n
t e r p r i s e which
owns
r
o p e r a t e s
t h i r t y (3 0 )
r
more
such
D
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8/20/2019 2015.10.23 IBA Petition
9/26
e s t a b
l i s h m e n
t s
i n
t
h e a g g r
e g a t e
n a t i
o n a l l y ;
o
r
i i ) an e s t
a b l i s h m
e n t
o p e r a t
e d
p u
r s u a n t
t
o
a
F r a n c
h i s e wher
e h e
F r a n c h
i s o r
and t h e
Fran
chisee
s)
of
u ch F r a n c h i
s o r
ow n
s r
o p e r
a t e t h i r t y
(30)
r m
ore
such
e s t a b
l i s h m e n
t s i n
t h e a g
g r e g a t
e n a t i
o n a l l y .
I d .
a t
21.
Th
e
B
oard d
e f i n e d
F a s t F
ood E s t a b
l i s h m e
n t
t
o i n c l
u d e such
e s t a b l i
s h m e n t
s l o
c a t e d w i t h
i n non
- F
a s t
Food
E s
t a b l i s h
m e n t s .
I d .
IV
. The
Labor
Com
mi s s i
oner
Di
sregar
ds Publi
c
Con
c erns
and
Adopt
s t
he Boar
d's
Repor
t n F u l
l .
2
5 .
P e t
i t i o n e r
t
i m e l y s u b m i t
t e d
t o
t h
e
Com
mi s s i
oner
t
s o b j e c
t i o n s t o
t h e
B o a
r d ' s
r
ecomme
ndatio
n.
See
Mastr
o A f f . Ex.
E,
e t
t e r
from Rand y
M
astr
o t o
Mari
o J . M u s
o l i n o ,
Comm
is s i o
ner of L
abor
Au
g . 4 ,
0 1 5 ) .
2 6 .
n ept
ember 1
0 , 2015,
C
ommiss
ioner
Muso
lino
a c c
e p t [ e d ]
t h
e Wage
o a r d
' s
r e p
o r t and
recomm
endati
ons n
l l r e s p e c t
s . O
rder
a t 1 . I n
p a r
t i c u l a r
,
t h e
Co
mmiss
i oner
a
c c e p t [ e
d ] t h
e
a n a l y
s i s
and c o n
s i d e r a t
i o n
of
a s i c
f a c t o r
s and
o
t h e r
c o n s i
d e r a t i
o n s
a r t i c u l
a t e d by
t h e W
age
Board
,
an
d t h e
B o a r d
' s
reco
mmenda
tion
o
r a
i s e m i n i
m um
w
ages
o n l y
a t l o c a t i
o n s
t h a t
a r e
p a r t
of a
c h a i n
h a t
h a s
t h i r t y
(30)
r
more
e s t a b l i s h m e n t s
n a t i o n a l l y .
I d .
a t
2
- 3 .
AR
GUME
NT
I .
Th
e
B oa
rd w a s I
mprope
rly C o n s t
i t u t e d
.
2 7 .
y
l l
a c c o
u n t s , t h
e
W
age
Board
was
n o
t
c o
mposed
of
r e p r
e s e n t a t
i v e s
of
employ
ers
and r e p r
e s e n t a t
i v e s of
mploye
es
e l
e c t e d from
n o m i
n a t i o n
s s u b m
i t t e d by
e
mp loye
rs
and
emp
loyees
n h e a f f e
c t e d
i n d
u s t r y . La
bor
Law
§
5
5 ( 1 ) .
The
s t a t u t
o r y
r e
p r e s e n t
a t i o n r e
q u i r e m
e n t i
s
c r i t i
c a l - w
i t h o u t
p
r o p e r
r e p r e
s e n t a t i
o n
an
d i n p u
t from
t h
e
a f f e c t
e d
i n d u s t r
y ,
a
wa g e b o a
r d c a
n n o t a i r l
y
a
nd
a d e q u a t
e l y e v a
l u a t e t h e
c
o s t s , b e n
e f i t s ,
and
c o n
s e q u e n
c e s
of
h e
a c t i o n
i t
i s c
o n s i d e
r i n g . To
e l e c t
empl
oyee a
nd e
mploye
r
f
rom
i n d u s
t r y wou l d
p l a
i n l y
c o n f
l i c t
w i t h
t h e
s t a t u t e
s
p
u r p o s e
and s che
me
d e
s i g n e d
t o
e
n s u r e
t h a t a
7
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8/20/2019 2015.10.23 IBA Petition
10/26
w
age b o a r
d a c t s i n t h e
i n t e r e s t
of
h o s e
a f f e c t e d . See
d §
5
0;
f
i d §
53(1)
r e q u i r i n g
C
ommissioner o
i n v e s
t i g a t e wages
on
h
e
p e t i t i o
n
of i f t y
o r more
e s i d e
n t s
of h e
s t a t e
engaged
n or f f e c t e
d
by
an
c c u p a t i o
n
o r o c c u p a t i o
n s
s o u g h t
t o
be
n v e s t i g a t e d
(emphasi
s
a d d e
d ) ) ;
s e e a l s o
i d .
§
55(1) p e r m i t t
i n g a s m an
y a s
n i
n e m
embers o be p p o i n t e d
t o
a wage
b o a
r d
t o
e n s u r e a d e
q u a t e
r e p r e s
e n t a t i o n ) .
28.
There s no
e v i d e n c
e
s
u g g e s t i n g t h a t
t h e Labor
Commissione
r
a
t i s f i e d t h
e
L e g i s l a t u r e
' s
ma
ndate
h e r e . T h e memb
ers
of
h e Boa
rd
were p p a r
e n t l y n o t
s e l e c t e d from
n o m i n a
t i o n s
from
h e a f f e c t e d
i n d u s t r y
,
and
h e
y
d i
d
n o t
a d e q u a t
e l y
r e p r e s e n
t [ ]
t h e
a f f e c t e d
employees and
e m p l o y e r s .
See
d
§
5 5 ( 1 ) .
I n s t e a d ,
t h e
Board
was
h e r r y -
p i c k e d
t o
r e a c h
a
p
r e o r d a i n e d c
o n c l u s i o n
and s composed
n t i r e l y of
memb
ers
who
have i t t l e t o
no
x p e r i e n c e
i n
t h e
f a s t food
i
n d u s t r y .
29.
Kevi
n Ryan,
h e l o n e
employer
r e p r e s e n t
a t i v e
on
h e
Boar
d, ounded
G i l t ,
a
members
-
o n l y o n l i n e
l u x u r y
f a s h i o n
s h o p p i n g
w e b s i t e
o f f e r i n g d i s c o u
n t s on h i g h
- e n d f a s h i
o n
a
nd
t o p
d e s i g n e
r
l a
b e l s , h t t p :
/
/ww
w.gilt.com/c
ompany/ m a i n . e
l s o
fo und
ed
MongoDB
n
a
dvanced d a t
a b a s e
comp
any,
t t p s :/
/www
.mongodb.co
m/company;
o l a , an o n l i n e
wedding-
r e g i s t r y
comp any
,
t t p s ://www
.zola.com/ab
out
/ i n
d e x ; and
K o n t o
r ,
a
w e b s i t e
f o r v i s u a l
s e a r c h
and
d i s c o v e r y f o r w o r k p
l a c e
d e s i g n , h t t p s :/
/
www.kontor.c
om/. There
s
n o v
i d e n c e
t h a t Mr
.
Ryan
h a s
any
o n n e c t i o n
w h a t
s o e v e r
t o
t h e
f a s t food
i n
d u s t r y .
And
Mr
.
Rya
n c a n n o t
p u r p o r t t o
r e l a t e
t o
empl
oyers of
m i n i m u m- wage
w o r
k e r s
i n
ew
ork :
i n 2010,
i s
compan
y
moved
h
e
b u l k
of
t s
warehouse
o p e r a t i o n s
from
Brooklyn
o
Kentucky,
where
h e
m i n i m u m
wage
s
$ 7 . 2 5 .
3 0 . Mike Fish
man,
h
e
p u
r p o r t e d
employee
r
e p r e s e n t a t i v e
on h e
Board,
s
s e c
r e t a r y
t r e a s u
r e r
of
h e S e r v i c e Emp
loyees
n t e r n a t i o n a
l
Unio
n
S EIU ) ,
which e p r e s
e n t s
j a n
i t o r s ,
n u r s i n g h o m e
w o r k e r s , n u r s
e s ,
c h i l d
c a r e
p r o v i d
e r s ,
s e c
u r i t y o f f i c e r s c o u
n t y and c i t y
w
o r k e r s ,
-
8/20/2019 2015.10.23 IBA Petition
11/26
and o
t h e r
w o
r k e r s .
SEI
U
w e b s i t e ,
h t t p :// w
w w . s e i u . o r g
/
b l o g / 2 0 1
5/7
/ a - u n i o n - o f -j a n i
t o r s i s
- b o r
n .
SEIU
's e p r
e s e n t a t i o n of a
v a r i e
t y
of o r k e r
s a c r o s s
m u l t
i p l e i n d
u s t r i e s , and
t s
more
h a n
$42,000
n
p o l
i t i c a l c o n t r
i b u t i o n s
t o
G
overnor
Cuomo
,
e e
h
t t p :
// d a t a . n e
w s d a y . c o m / l o n
g -
i s l a n d /d a t a
/
campai
gn
/
c o n t r i b u t i o n s
c u o m o
/
a r e i n s u f f i c i e
n t
g
r o u n d s t o m
ake Mr
.
ishman
a
p r o p e r
r e p r e s e n t a t i v
e
f o
r f
a s t food
w
o r k e r s .
31.
Mayor
Byron
Brown
, h e
p u t a t i
v e i n d e p
e n d e n t
r e
p r e s e n t a t i v e of
h e g e n e r a l
p u b l
i c
on h e Boa rd,
s
t h e
Mayor
of
u f f a l o . 1
Mayo
r
Brow
n
w
a s
a
o c a l s
u p p o r t e r of
Gove
rnor
Cuomo
's
l a n
t o
r a i s e t h e mi
nimum
wage
b e f o r e
b e i n g a p p o i
n t e d
t o t h e
Board.
O
nc e
a p p o i n t e d ,
Brown
i d
n o t
even
w a i t
f o r t h e
Board
o
c o m p l e t e i t s
h e a r i n g s b e f o r e
d e c l a r i n g
t h a t
[ c
] l e a r l y ,
t h i s b o a r d
b
e l i e v e s t h a t
t h e r e
needs o
be a u
b s t a n t i a l
i
n c r e a s e i n t h e h o u r l y w
ages of
f a s t
foo
d w o r k e r s . Wag
e Bo
ard H e a r
i n g (June
29, 015),
v a i l a
b l e
a
t
h t t p s :
// y o u
t u . b e/ n i 5 j
v w l d9Nw
3 2 . The
a p p o
i n t m e n t
of
h e s
e t h r e e
i n d i v i d u a l s -none
ofwhom d e q u a t e l y
r e
p r e s e n t s
t h e a f f e c t e d
employer
s and employees
f o r t h i s
e x t r a
-
l e g i s l a t
i v e
bo
dy
s w i t h o
u t
p r e c
e d e n t
i n
ew ork
S t a
t e . U
n l i k e
t h
i s Board, a s t
wage b
o a r d s
i n c l u d e
d r e p r e
s e n t a t i v e s o
f h e
a f f e c t e d
i n d u s t r i e s and o c c u p
a t i o n s - a s
t h e Labor La
w
e q u
i r e s
-and
o s t e n s i b l y
i n d e p e n
d e n t
p u b l i c
r e p r e s e n t a t i
v e s .
S e e ,
e . g .
2 0 0 9
W
age Board
f e a t u r i n g
s e v e r a l r e p r e s e n t a t i
v e s fr
om
t h e
h o t e l
and
r e s t a u r a n t i n d u s t r y
, t h e
i n d
u s t r y
a t
i s
s u e i n t h e
p r o
p o s e d
wage
n c r
e a s e ) ;
2 0 1 4
Wage
Board
( f e a t u r
i n g
s e v e r a l
r e p
r e s e n t a t i v e s
from
t h e h o s p i t
a l i t y i n d u s t r
i e s , t h e i n d
u s t r y
a t i s s u e
i n
t h
e
p r o p o s e d
wage
n c r e a s e
f o r
food
s e r v i c e
workers
and
s e r v i c e
e m p l o y e e s ) .
Thus,
h e
Governor uomo
as c l o s e
t i e s
t o B u f
f a l o
and h a
s
com
mitted
t o
i n v e s t i
n g
a
i s t o r i c $ 1
b i l l i o n f o r
economic
developme
nt h e r e .
S
ee h t t p :
/ / b u f f a l o b i
l l i o n . n y . g o v
/ a b o u t -
b u f f a l o -
b i l l i o n
.
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8/20/2019 2015.10.23 IBA Petition
12/26
recommen
dations
of
h e
Board,
whic
h
wa s
o
n s t i t u t e d
i n
c o
n t r a v e n t i o n
of h e
Labor
Law,
w i t h o u t
a
r e p r e s e n t a t i
v e
f o r
f
a s t
f
ood employer
s o r
employe
es, r e
n u l l and
v o
i d o n h e i r
f a c e .
I I .
The
a b o r
Co
mmissioner's
Or d
e r V i o l a t e s the Separa
tion
- o f -
Po
we r s D o c t
r i n e .
33. Th
e
N
ew ork
C o n s t i t u t i o n
p r o v i d e s
t h a t
[ t ] h e
l e
g i s l a t i v e power
of h i s
s t a t e
s h a l l
be v e s t e d
i n t h e
s e n a t e and assembly.
N.Y.
o n s t . , r
t . I I I , §
.
Courts
have
r e p e a t e d l
y
s t r u
c k down
d m i
n i s t r a t i v e a c t i
o n s . . . where
h e
c h a l l e
n g e d
a c t i o n
c o u l d not
have been
d e e m e d
w i t h i n [a
t a t u t o r i l
y a u t h o r i
z e d d e l e g a t i o n ] w
i t h o u t g i
v i n g
r i s
e t o
a
o n s t i
t u t i o n a l s e p a r a t
i o n of
powers problem.
B o r e a l i
v .
A x e l r o d ,
71
N
.Y.2d 1 , 1 1
(1987
); e e
a l s o N . .
S t a t e w i d e
C o a l .
o f
Hispanic
Chambers
o f
o m m e r c e .
N .
. C .
Dept
f
ealth
Mental
ygiene
S o d a
B a n
) ,
23
N.
Y.3d 68 1,
9 7
201
4) ca
p
o n
p o r t i o
n
s i z e ) ;
Under 2 1 ,
C a t h o l i c
Home
ur e a u
or
D
ependent
C h i l d r e n
v . New
o r k
, 65
N.Y.2d
344
1 9 85) e m p l o y
ment
i s c r i m i n a t i
o n
r u l
e ) ;
Ma
tter o
f
Ah
med C i t y
o f N . Y . ,
129
A
.D.3d 435,
440 1 s t Dept
015) t a x i
d r
i v e r
h e a
l t h c a r e r u l e ) ; E l l i
c o t t
Group,
LL . S t a
t e
o f
.
.
E x e c .
De
pt.
f f o f
en.
e r v s . ,
8 5 A.D.3
d 48,
54
4 t h
De
pt
011
)
( p r e v a i
l i n g
wa g
e
e g u l a t i o n ) ;
f Jewish
Home Infirma
ry .
omm r
o f
.
.
S
t a t e Dept f
H e a l t h ,
8 4
N.
Y.2d 2
52 ,
63
1994) r e t r o a c t i v e a p p l i c a t i o
n
of
Medicaid
reimbursemen
t a t e .
34. B
o r e a l i s e t s
out o u r
` c o a l e s c i n g
c i r c
u m s t a n c e s
'
o
d e t e r m
i n e
w
hether
` t h e
d i f
f i c u l t- t o -
d e f i n e
l i
n e betwee
n a d m i n i s t r a t i v
e r u l e -making
and
l e
g i s l a t i v e
p o l i c y - maki
ng h a [ s ]
been
t r a n s g r e s s e
d . '
S o d a B a n
,
3 N.Y.3d
a t
6 9 6 q u o t
i n g
B
o r e a l i ,
71
N.Y.2
d a t 1 1 ) .
As h e
term
` c o a l e s c
i n g
c i r c
u m s t a n c e s '
s u g g e s
t s ,
t h e Court
does n o t r e g a r d
t h e f
o u r
c i r c u
m s t a n c e s a s
d i s c r e t e ,
n e c e s s a r y
c o n d i t i o
n s
t h a t
d e f i n e
improper
p o l i c y -
m
aking
b y an agency,
nor a s
c r i t e r
i a
t h a t
s h o
u l d
be r i g i d l y a p p l i e
d
i n every
c a s e
i n
which
an
agency
s
accused of
r o s s i n g t h e
l i
n e
i n t o
l e g i s l a t i
v e t e r r i t o r y .
R a
t h e r
[ t h e Court]
r e a t s ] t h
e c i r c u
m s t a n c e s a s
o v e
r l a p p i n g , l o s
e l y
r e l a t e
d f a c t
o r s
t h a t ,
t a k e n
t o g e t h e r ,
s u p p o r t
t h e c
o n c l u s i o n
t h a t
an
agency
has
r o s s e d
t h a t l i n e .
I d .
( q u o t i n g
B o r e a l i ,
71
N.
Y.2d a t 1 1 ) .
10
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8/20/2019 2015.10.23 IBA Petition
13/26
3 5 .
The o r e a
l i
f a c t o r
s a r e :(1
)
h e t h e r
t h e
a d m
i n i s t r a
t i v e a c t i
o n i s b
a s e d
on
weighi
ng
ec o
nomic
a
nd
s o c i a l
c o n c e r n
s ,
o u t
s i d e
t h e
realm
of
h e a g e
n c y ' s
e x p
e r t i s e ,
w i t h o u
t
l e
g i s l a t i v
e i n s t r u c
t i o n
r e g a r
d i n g
w h e t h
e r
o r
ho
w o weig
h h o
s e
c o
n c e r n s ;
(2) h
e t h e r
t h
e
agency
r e g u l
a t e s
on
a
l e a n
s l
a t e , i n s t e a
d
of
e r e l y
f i l l i n g i n t
h e
d e t a i l s
of h e
l
e g i s l a t
i o n ;
(3
)
h e t h e r
t h e
agency
c t e
d
i n an r e a
i n w hich
h e L e
g i s l a t u
r e
had
r e p
e a t e d l y
t r i e d - -
and
a i l e
d
- -
t o
r e a
c h
agreem
ent
n t
h e f a c e
of
u b s
t a n t i a l
p u b
l i c d e b a t
e and
v i g o r
o u s l
o b b y i n g
b
y a
a r i
e t y of
i n t e r e
s t e d
f a c t i o
n s ;
and
4
) he
ther any
s
p e c i a l
e x
p e r t i s e
o r t e c h
n i c a l
compe
tence
w
a s
i n v o
l v e d
i n
t h e
develo
pment o
f h e c h
a l l e n g
e d
r e g u l a t
i o n s .
B o r e
a l i ,
71
N.Y.2d
a
t
12
- 1 4
.
36.
Any
o r e a l i
a n a l y s i s
s h o u l d
c e n t e r
on
h e
theme
h a t
i t
i s
t h e
p r o v i n c e
of
h e
p e o p l
e ' s
e l e c t
e d
r e p r e s
e n t a t i v
e s ,
r a t h e r
t h a n
a
p p o i n t
e d a
d m i n i s t
r a t o r s ,
t o r
e s o l v e d i f f
i c u l t
s o c i a
l
p
roblem
s by
maki ng
h o i
c e s
a m
ong c
om peti
ng
e n d s
. ' So
d a
Ban,
3
N.
Y.3d
a t
6 9
7
q
u o t i n g
B o r e a
l i ,
71 N.Y.
2d a t
1 3 ) . As
h e Soda
B
an
e c i
s i o n
m
ade l e a r
, l l f o u r
B o r e a
l i
f a c t o r s
need
n o t be
found
o r an c
t i o n t o
v
i o l a t e s
e p a r a t i
o n of o
wer s; h e s
e
f a c t o
r s
s e r v
e
t o
g u
i d e
t h e
s
e p a r a t
i o n- o f -pow
ers
n a l y
s i s .
S
ee
d .
3
7 .
The i r s t B
o r e a l i
f a c t
o r
s
how s
h
e age
ncy
i n v
a d e d t h
e p r o v
i n c e of h e
L e g i s
l a t u r e ,
and
o p e r a t
[ e d ] o
u t s i d e
of t s
p
r o p e r
s
p h e r e
o
f
u t
h o r i t y ,
by
c t i n g
s o l e l
y on i t
s ]
ow
n d e
a s of
sou
nd
p u
b l i c
p o l i c y
. B o r
e a l i ,
7
1
N.Y
.2d
a t
12
q u o t a t i
o n
and i t
a t i o n o m i t t
e d ) .
The Labor
Law
does
n o t
g r
a n t t h e
Commi
ss ione
r
u t h o
r i t y t o d i
s c r i m i n
a t e
-
a s
he i d h e
r e -a m
ong
e
mploy e
rs
b
a s e d
on w h e t
h e r t h e
emplo
yer
s
p a r t
of c h a i
n ,
w h e
t h e r mor e
h
a n t h
i r t y
e s t
a b l i s h m
e n t s
f e a t u r e
t h a t
c h a i n ' s b r a n d i n g n a t i o n w i d e , o r w h e t h e r t h e
b a l a n c e s h e e t
of
h e
cha in
s
s t r o n g .
Se
e Orde
r
t 2;
ee
l
s o Report
t
1 ,
1 9 . 2
Thus,
h e
Boar d
an
d
h e
Co
mmissi
oner c t e d
beyond
Becau
se
h
e Lab
or
Commi
ssione
r
a d
o p t e d t
h e
B o a r d '
s Repo
rt
i
n a
l l r e s p e
c t s , Order
t 1 ,
t h e f
l a w s
i
n
t h
e Rep
or t
e c e s
s a r i l y
t
a i n t t h e
Orde
r
a s
w e
l l .
1
1
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t h e i r
d e l e g a t e d
power
when
h
e y
b u i l t
a
e g u l a t o r y
scheme on
t h e i r ]
own
o n c l
u s i o n s
a b
o u t
t h e
a p p r o p r i a t e b a l a n c e
of
r a d
e - o f f s
betwe
en
h
e a l t h
and
c o s t .
B o r e a l i ,
71
N.Y.2d a t 1
1
-
12
( c o n c l
u d i n g t h a t
t
h e agency had
s t r e t c h e d
[ t h e
e n a b l i n g ] t a t u t e beyon
d t s c o n s t i t u t i o
n a l l y v a l i d
r e a
c h when
t
u
s e d
t h
e s t a t
u t e a s a
a
s i s f o r
d r a f t i n g a code embody
ing
t s
own s s e s s m e
n t
of
what
u b l i
c p
o l i c y
ough
t o be
) .
38. T
he
se
cond B o r e a l i
f a c t o r
shows
h a
t t h e a
gency
e n c r o a c h e d on
h e L e g i s l a t u r e ' s
a u
t h o r i t y b y
c r e a
t i n g
t s
own
compre
hensive s e t
of
u l e
s
w i t
h o u t
b e n e f i t
of e g i s l a t i v e
g u i d a n c
e .
I d . a t 1 3 . Far
from i l l
i n g
any
gap n
t h
e La
bor
L
aw, h e
Order
a d o p t e d
t
h e
B o a r d '
s
u n p r e c e d e n t e d
r u l e t h a t
makes
h e
a p p l i c a t i o n
of
h e
minimum
wage
u r n
on
w h e t h e r
an
employer s p a r t
of
a
a t i o n w i d e
c h a i n w i t h
t h
i r t y
o r
m
ore o c a t i o n s . See
Order
t 3 ;
R e p o r t
a t
2 1 .
The e g i s l a t u r e
has
n e
v e r
appr
oved a
i s t i n c t i o
n
t h a t
a p p l i e s
wage
n c r
e a s e s t o a u b s e t
of
employe
rs
n
a p e c i f
i c i n d u s
t r y .
nd
h e Department
of abor
h a s
n e v e r
i s s u e d
a wage
r d e r
on
t h a t
b a s i s ,
t
h r o u g h a wag
e b
o a r d o r
o t h e r w i s e
.
I n
a d o p t i n g
t h a t
d i s t i n c t i
o n
h e r e , t h e ag
ency
wrot e
on
a
l
e a n s
l a t e
w i t h o u t
any
semblance of
e g i s l a t i v e
d i r e c t i o n .
I d .
3 9 .
The
h i r d
B o r e a l i f a c
t o r s t r
o n g l y
i n d i c a t e s
t h a t
t
h e ag e
ncy v i o
l a t e d
s
e p a r a t i o n
of
p
owers b
y
a c t [ i n g ]
i n
an
a r e a
i n w
hich
h
e L
e g i s l a t u r e
had r e p e a t e d l
y
t
r i e d -a
nd a i l e d
-
t o
r e a
c h
agreeme
nt
n
t
h e f a c e
of u b s
t a n t i a l
p
u b l i c
d e b a t e
and v i g o r o u s
l o b b y i n g
b y
a
a r i e t y of
i n t e r e s t
e d f a c
t i o n s . I d . a t
1 2 . I n
2
013,
h e
L e g i s
l a t u r e
and
t h e
Gover
no r
b r o k e r e d
a e a l , a f
t e r
s i g n i f i c a n t p u b
l i c i n p
u t , o g r a d u a l
l y r a i s
e
t h e
mi
nimum
wage b y
$1.75
o v e r
t h r
e e y e a
r s .
See
supra
¶¶
- 9 .
I n
2015,
however,
h e
L e g i s l a t u r e
r e j e c t e d
Governor
Cuomo's
r o p o s a l
t o
r a i s e
t h e
min
i m u m
wag e
b y
a n
o t h e r $1.50 p e r
y e a r f o r f o u r
more
y e a r s , due o
s t r i d e n t p u b l i c
o p p o
s i t i o n , and d i d n
o t
r e a c h
agreem
ent
on
an
l t e r n
a t i v e
p r o p o s
a l .
See
supra ¶¶
1 1 - 1 2 .
The
L e g i s l a t u r e '
s
f a i l
u r e t o
a r
r i v e a t such an
agree
ment
d o e s ]
n o t a u t o m a t i c a l
l y
e n t i t l
e
an
12
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15/26
a d
m i n i s t r
a t i v e ag
ency
t o t a k e
i t
up
on t
s e l f
t o
i l l
t h e
va c
uum a
nd
impos
e
a
o l u t
i o n of
t s
own.
B o
r e a l i ,
71
N
.Y.2d
a t
1 3 .
A c
c o r d i n
g l y ,
h e
Commi
ssion
er a r r o g
a t e d t o h i m
s e l f
h e
po
we r
r e
s e r v e d
t o
t h e
l e g i s l t
i v e
bra
nch b y a t t e
m p t i n g
t o
r e s o l
v e d i f f i c u l
t s
o c i a l
probl
ems b y
makin
g c h o
i c e s a
mon g com
peting
e n
d s .
I d . ; see
a l s o So
d a
Ba n ,
2 3 N.Y.3
d
a t
6
97.
4
0. Th
e
o u r t h
B o r
e a l i
f a c
t o r
s
h ows
h e
age
ncy
o
v e r s t e
p p e d
i t s
bou
nds b
e c a u s e
t h e
O
rder a n
d Repor
t i d n
o t
d
raw
upon
a n y s
p e c i a l
e x p
e r t i s e o r t e
c h n i c a l
c
ompete
nce. B o r e a
l i ,
7 1
N.Y.2
d a
t
1 4 .
T
h e
Bo
ard h e a r
d t e s t
i m o n y
an
d r e v i e
w e d w r i t t e n
c
ommen
t s and
s u
b m i s s i o
n s -
j u s t a
s a n y
e g
i s l t o r
wou
ld -a
n d
r e l i e d on
each
Board
m
ember'
s i n d
e p e n d e
n t kno
wledg
e
of
h e
i n d u s t r y
and
t h e
e c onomy.
Report
t
6 .
But
h e
Board
l a c k e d
s p e c i a l i z e d
knowle dge
of
h e
r e l e v
a n t
i
n d u s t r y
.
Se
e
i n f r a ¶¶ 2 7
-
3 2 .
Th e
g
e n e r a l
knowl
edge
h
a t
t h
e
Boa
rd h ad
a b o u t
l a b o r
a
n d b u s i
n e s s
wa s
n o t
s
p e c i f i c
t o t h e
f a s t foo
d i n d u
s t r y , h
e p r o d u c
t of
a n y
p a r t
i c u l a r e x p
e r t i s e ,
o r
b
a s e d
on a n y e c
h n i c a l
c
ompete
nce.
t
t
h u s d
i d n o t
u s t i f y r b i t r r i
l y
makin g
wa g
e s w i t
h i n a
s i n g
l e
i n d u s t r
y
d i
v e r g e b
a s e d s o
l e l y o
n w
hether
a
n
em
ploye
e wor
ks
a t
a c h
a i n
t h a t
h
a s
a t
l e s t 3
0
l
o c a t i o n
s
n a t i o n a l
l y . H
e a r i n g
t
h e
vie
ws
of
a r i o
u s
i n d i
v i d u a l s
,
r e v i
e w i n g
p u b l i c
a t i o n s s u b m
i t t e d
b y
e x p e r t s
, and
c a r v i
n g o
u t exem
ptions
o r
v a r i
o u s
s p e c
i a l i n t e r
e s t
group
s a n
n o t b
e s u
f f i c i e n t
t o u s u
r p t h e
L e g
i s l a t u r
e ' s
r i g h
t f u l
r
o l e a
s a
c
o
- e q u a
l
b r a
n c h of
overnm
ent. See B o
r e a l i ,
71
N.Y.2
d a
t 1 4
.
41.
A l l f o
u r
B o r e a l
i
f a c t o r s
i n d i c a t
e t h a t
t
h e
agency
r o s s
e d
t h e
l i
n e
betw
een
a
d m i n i s t
r a t i v e r
u l e -mak
in g
and l e
g i s l t i
v e
p o
l i c y - maki
n g
wh e n
t s p u
r n e d t h e
L
e g i s l a t u
r e ' s
r e j e c t i o n
of
n o t h e r
mi n i mu m
wa g e
n c r e a s e ,
an d
i n s t e a d
u s e d
e x e c u t i v e
f i t
t o
r e s o l v e
d i f f i c u l t
s o c i
a l
prob
lems
b y
ma ki
n g
c h o i c e s
a mo
n g co
mp etin
g
e
n d s .
Se
e
B o r e a
l i ,
71
N.Y
.2d a t 1 1 , 1 3 .
That
v i
o l a t i o n of
h
e
L e g
i s l a t u r
e ' s
a u t h o
r i t y
c a n
n o t s t a n d .
1
3
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I I I .
The
Order s
Contrary o the
New
York
Labor Law.
A.
The
Order
improperly
o c u s e s
on
employers
f f i l i a t e d
with
c h a i n s with m ore
than
t h i r t y
l o c a t i o n s ,
not
on
an occupation
or
n d u s t r y .
42.
The
Labor
Commissioner
i o l a t e d
t h e
Labor
aw by
m p e r m i s s i b l y f o c u s i n g on
t h e
e m p l o y e r ,
which t
d e f i n e d a s a u b s e t
of
a t i o n a l f a s t food c h a i n s .
Compare
Charge t
1 ,
w i t h
D e t e r m i n a t i o n
a t
1
( d e t e r m i n i n g
f a s t
food w o r k e r s , r e g a r d l e s s
of h e e m p l o y e r ' s
a f f i l i a t i o n s ,
were
e c e i v i n g i n a d e q u a t e
w a g e s ) .
Under h e
g o v e r n i n g
s t a t u t e , a
r o p e r l y
c o n s t i t u t e d
b o a r d
i s
p e r m i t t e d t o i n q u i r e
i n t o and e p o r t and recommend d e q u a t e
m i n i m u m
wages
and
e g u l a t i o n s
f o r employees
n any
occupation
or
c c u p a t i o n s .
Labor aw
§
53(1)
(emphasis
d d e d ) .
O c c u p a t i o n , i n
t u r n ,
s
d e f i n e d a s an
n d u s t r y ,
t r a d e , b u s i n e s s
o r
c l a s s
of
work
n
which
employees
r e
g a i n f u l l y employed.
I d .
§
51.
Nothing
g i v e s
t h e
Commissioner
o r
t h e Board
h e a u t h o r i t y
t o
a r b i t r a r i l y
f o c u s on
h e
employer
n s t e a d
of
h e
o c c u p a t i o n
of
n
employee,
r t o
s l i c e
and
i c e a
a r t i c u l a r
i n d u s t r y , t r a d e , b u s i n e s s o r c l a s s
of
work
beyond
r e c o g n i t i o n i n
o r d e r t o
r e g u l a t e
a
u b s e t
of t ,
a s
was done
e r e . Such
c t i o n
i s w i t h o u t
p r e c e d e n t .
4 3 .
A d d i t i o n a l l y , t h e
B o a r d ' s d e c i s i o n i s i n c o n f l i c t
w i t h h i s t o r i c a l p r a c t i c e . For
example,
h e t h r e e
most
e c e n t
wage
o a r d s were i r e c t e d t o
c o n s i d e r
wages
o r p a r t i c u l a r
employee
c c u p a t i o n s
i n
an n t i r e
i n d u s t r y , n o t a b l y
w i t h o u t
d i s t i n g u i s h i n g between w o r k e r s
p e r f o r m i n g
t h e
same obs
r between
employers
n
t h e p a r t i c u l a r i n d u s t r y . See
Opening
S t a t e m e n t
and
Charge o
t h e
20 1 4
Wage Board
t
1 ( c o n s i d e r i n g
wages
of food e r v i c e w o r k e r s
and e r v i c e
employees
n t h e
h o s p i t a l i t y
i n d u s t r i e s ) ; Opening
S t a t e m e n t and
Charge o t h e 2009
Wage Board
t
1
( c o n s i d e r i n g wages
o r t i p p e d employees of d i f f e r e n t o c c u p a t i o n a l groups
n
t h e
h o t e l
and
e s t a u r a n t
i n d u s t r i e s ) ;
Opening S t a t e m e n t and Charge o
t h e 1986 Wage
Board
(empaneled
o
c o n s i d e r
wages
o r a l l o c c u p a t i o n s
w i t h i n
t h e s t a t e .
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44. I n
f a c t ,
p r i o r
wage
b o a r d s
s o u g h t
t o
e l i m i n a t e
i r r a t i o n a l d i s t i n c t i o n s between
employees
n t h e
same
o c c u p a t i o n and a c r o s s i n d u s t r i e s ,
a s
had been
t h e
p r a c t i c e o v e r
t h e
p a s t
30 y e a r s , o a f f o r d
employer
and
employees a
l e a r e r u n d e r s t a n d i n g
o f
aws f f e c t i n g
t h e i r
i n d u s t r i e s .
Report and
Recommendation of
h e
2009
Wage Board
a t
7 .
Although t h e Labor
Commissioner
e c o g n i z e d t h a t
employers and employees
b e n e f i t from
c o m m o n u l e s
f o r
a l l
b u s i n e s s e s i n t h e
a f f e c t e d
i n d u s t r i e s
(Charge
a t
2 ) , h i s
O r d e r c r e a t e d d i f f e r e n t
m i n i m u m
wage
r e g i m e s
b a s e d o n
whether
an employ ee works
t
a
h a i n w i t h a t
l e a s t
3 0 1 o c a t i o n s
n a t i o n a l l y , s e e
Order
a t
2 .
45.
The
e p o r t
p r e p a r e d
b y
P r o f e s s o r
David
H.
ewin,
e i l
H.
acoby
p r o f e s s o r
of
management,
h u m a n e s o u r c e s , and
o r g a n i z a t i o n a l b e h a v i o r a t t h e
UCL nderson S c h o o l
of
Management, o n f i r m s
t h a t t h i s
a r b i t r a r y i s o l a t i o n
of
o r k e r s b a s e d
o n
n a t i o n a l a f f i l i a t i o n
and
n u m be r
of
o c a t i o n s i s
i n
c o n t r a v e n t i o n o f
h e
Labor
L a w and
l l k n o w n
p r e c e d e n t . See
M a s t r o
A f f . Ex.
F,
r e l i m i n a r y
Report
of r o f . David
H. ewin.
46.
P r o f . Lewin h a s
p r o v i d e d
c o n s u l t i n g
a d v i c e and e x p e r t
t e s t i m o n y
i n numerous
l a b o r
and
employment
m a t t e r s ,
n c l u d i n g
wage s s u e s , and
h a s p u b l i s h e d
o v e r
20
books
and
more
h a n
150
s c h o l a r l y
and
p r o f e s s i o n a l j o u r n a l a r t i c l e s o n n u merous a s p e c t s
o f employmen t
r e l a t i o n s .
47. A s
r o f .
Lewin
e x p l a i n s :
[Based on] my
e v i e w
o f h e d i s c l o s e d
m a t e r i a l and
t h e
s o u r c e s
I
was
b l e
t o
i n d e p e n d e n t l y o b t a i n ,
a s
w e l l
a s
t h r o u g h
my i g n i f i c a n t and
l o n g -
s t a n d i n g
e x p e r t i s e i n
t h i s
a r e a
and deep
a m i l i a r i t y
w i t h t h e
r e l e v a n t
b o d y of
academic
e s e a r c h ,
t h e
recommendations made b y
h e Board
[and a d o p t e d
b y h e
Labor
Commissioner]
r e
n o t
w e l l -founded
b e c a u s e t h e Board
(1)
a i l e d t o
r e l y
o n e l e v a n t
e m p i r i c a l
d a t a ;
(2)
n a p p r o p r i a t e l y
r e l i e d i n s t e a d
o n
n a p p o s i t e
d a t a
r e g a r d i n g t h e
e n t i r e f a s t f o o d
i n d u s t r y ; (3)
i s u n d e r s t o o d
t h e
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51.
The
Labor
Commissioner's
Order s u f f e r s from
t h e
s a m e e f e c t s , b e c a u s e
he
a c c e p t [ e d ]
t h e
Wage B o a r d ' s
r e p o r t
and recommendations
n
a l l r e s p e c t s . Order a t
1 ;
s e e
supra
¶ 6 .
Both t h e Order
and
R e p o r t a r e t h e r e f o r e
c o n t r a r y
t o
l a w .
B .
The
O r d e r does not
adequately analyze the
L a b o r
L aw ' s x c l u s i v e
employee-
focused f a c t o r s
f o r
when t o r a i s e wages.
5 2 .
The
B o a r d ' s
Report
a i l e d
t o
a d e q u a t e l y
a n a l y z e
t h e t h r e e s t a t u t o r y c r i t e r i a f o r
recommending a
wage i n c r e a s e : (1)
t h e
a m o u n t
u f f i c i e n t t o
p r o v i d e a d e q u a t e
m a i n t e n a n c e and
t o
p r o t e c t h e a l t h
;
2) t h e v a l u e
of h e
work
o r c l a s s i f i c a t i o n
of work p e r f o r m e d ;
and
(3) t h e
wages p a i d i n t h e
s t a t e f o r work
of
i k e
o r comparable
c h a r a c t e r .
Labor
aw §
654.
5 3 .
For
example,
h e
Board
f a i l e d
t o a d e q u a t e l y
c o n s i d e r
t h e
wages p a i d i n t h e s t a t e
f o r
work of
i k e
o r
comparable
c h a r a c t e r ,
i d .
when
t
recommended t h a t
f a s t
food w o r k e r s a t
n a t i o n a l
c h a i n s
w i t h
a t l e a s t
3 0 1 o c a t i o n s s h o u l d be t r e a t e d
d i f f e r e n t l y t h a n a l l o t h e r f a s t food
w o r k e r s . The
Board
compared
o r a n g e s t o
a p p l e s b y
l o o k i n g
n o t t o
o t h e r
f a s t
food w o r k e r s ,
b u t
t o f u l l -
s e r v i c e workers
wh o a r e employed
i n
a
i f f e r e n t o c c u p a t i o n i n
a
d i f f e r e n t
segment
of
t h e
i n d u s t r y
a l t o g e t h e r .
An d
t h e B o a r d ' s u n s o u r c e d
c i t a t i o n
t o
a p u r p o r t e d
8%difference
between t h e
wages
of
employees
a t what
t b r o a d l y t e r m s
c h a i n
r e s t a u r a n t s
(not
i m i t e d t o
n a t i o n a l
c h a i n s
w i t h a t
l e a s t 30
o c a t i o n s ) and n o n- c h a i n r e s t a u r a n t s c a n n o t
u s t i f y an a l m o s t
70%rai se
o r s o m e of h o s e
chain m p l o y e e s . To
d o
s o ,
e f f e c t i v e l y
c r e a t e s
a wage
gap
more
t h a n e i g h t t i m e s
l a r g e r t h a n
t h e one
t p u r p o r t s t o
remedy.
See
R e p o r t
a t 1 0 ;
e e a l s o Lewin
P r e l i m i n a r y
Report
a t
5
- 8 .
5 4 .
The
Board a l s o
f a i l e d
t o
a d e q u a t e l y
c o n s i d e r t h e
v a l u e
of h e
work e r f o r m e d
b y
t h e
e m p l o y e e s .
See
Labor
L a w §
654.
I n s t e a d , t s i m p l y i n f e r r e d
t h e v a l u e of h e
work
from t e s t i m o n y t h a t t h e
f a s t
food
i n d u s t r y
i s
h i g h l y p r o f i t a b l e and g r o w i n g .
R e p o r t
a t 1 5 .
F u r t h e r ,
w i t h o u t
e x p l a n a t i o n ,
t h e
Board
o v e r l o o k e d
l a r g e d i f f e r e n c e s
i n
t h e
c o s t of
i v i n g
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between New
ork
C i t y and t h e
r e s t
of h e s t a t e . See Labor Law§
54.
The Board
even a i l e d
t o do
any
a t i o n a l a n a l y s i s
of
h e
s t a t u t o r y c r i t e r i o n t h a t
t h e
wage
chosen
be u f f i c i e n t t o
p r o v i d e
a d e q u a t e
m a i n t e n a n c e and t o p r o t e c t
h e a l t h .
I d . I t
simply
announced
t h a t 1 5 w a s
h e
n e c e s s a r y w age
e v e l w i t h o u t
s u f f i c i e n t
c o n s i d e r a t i o n of h e v a r i a b i l i t y
i n
a v e r a g e work weeks,
a m o n g
o t h e r
f a c t o r s . The B o a r d ' s
f a i l u r e
t o
match
t s
f a c t u a l
a s s u m p t i o n s w i t h i t s
recommendation e n d e r s
i t s
a n a l y s i s
i n t e r n a l l y
i n c o n s i s t e n t and v i o l a t i v e of h e
s t a t u t o r y
s t a n d a r d .
5 5 .
And
f t e r
i n a d e q u a t e l y a n a l y z i n g
t h e t h r e e s t a t u t o r y c r i t e r i a
t h e
Board r e s t e d i t s
recommendation
i n
l a r g e p a r t
on
t a t u t o r i l y
i m p e r m i s s i b l e
f a c t o r s ,
i n c l u d i n g t h e
c h a r a c t e r i s t i c s
of
t h e
employer e . g . ,
w h e t h e r t i s p a r t of a
a t i o n a l
c h a i n
c o n s i s t i n g of30 r more e s t a u r a n t s ) and
o v e r a l l
i n d u s t r y p r o f i t a b i l i t y . See Report t
8, 8 . These a c t o r s l o o k
beyond t h e
employee-
f o c u s e d
f a c t o r s
mandated b y h e s t a t u t e and i n s t e a d f o c u s on t h e
c h a r a c t e r i s t i c s
of
h e
e m p l o y e r .
Non e
of
h e s e
f a c t o r s i s
p e r m i s s i b l e u n d e r
S e c t i o n 654.
By a s i n g i t s d e c i s i o n on them,
h e
Board
exceeded
t s
s t a t u t o r y a u t h o r i t y and a c t e d
c o n t r a r y
t o
l a w .
IV. Th e
Order
s Arbitrary
a n d
Capricious a n d
Not
Supported
b y
the Evidence.
5 6 .
The B o a r d ' s Report s
i r r a t i o n a l
b e c a u s e
t h e r e i s n o d a t a s u p p o r t i n g
i t s
d e c i s i o n t o
a r b i t r a r i l y
l i m i t t s recommendations
o
c h a i n s
w i t h a t
l e a s t 3 0 1 o c a t i o n s
i n
t h e a g g r e g a t e
n a t i o n a l l y . The B o a r d ' s Report and t h e
u n d e r l y i n g
r e c o r d
(so
a r
a s t
i s a v a i l a b l e ) r e
d e v o i d
of
any
o u r c e
t h a t
r e f l e c t s a i s t i n c t i o n between
employees
o r employers
f f i l i a t e d
w i t h
n a t i o n a l
c h a i n s
w i t h
a t
l e a s t 3 0 1 o c a t i o n s , and
t h e
r e s t
of h e
f a s t
food
i n d u s t r y .
See L e w i n
r e l i m i n a r y
Report t
5
- 8 .
I n
f a c t ,
e v e r y s t a t i s t i c
s t u d y , and
s o u r c e
c i t e d b y h e Board e l a t e s t o
t h e
f a s t food
i n d u s t r y
as a
whole
-not o t h e s u b s e t
of
h a t
i n d u s t r y
t h a t
t h e Board
h a s i m p r o p e r l y t a r g e t e d .
S e e ,
e . g . ,
Report
t
1 ,
- 9 ;
e e
a l s o
L e w i n
r e l i m i n a r y
Report
t
- 1 0 .
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5 7 .
The e s u l t s
of h e
Order
show
how t
i s a r b i t r a r y and a p r i c i o u s : f a s t
food
w o r k e r s who work fora 30-
r e s t a u r a n t
n a t i o n a l c h a i n w i l l
be r e a t e d
d i f f e r e n t l y
t h a n
t h e i r
c o l l e a g u e s
who
work
t (a) a s t food
h a i n w i t h fewer h a n
3 0 1 o c a t i o n s n a t i o n a l l y , b)
n a t i o n a l non-
r e s t a u r a n t
c h a i n w i t h
more
h a n 3 0 1 o c a t i o n s n a t i o n w i d e , such
s
a
l o t h i n g r e t a i l e r
o r
a
drug t o r e , and
c )
non-
F a s t
food e s t a b l i s h m e n t , even
when
a a s t food
c h a i n
s
l o c a t e d
w i t h i n
[ t h e ]
non
- F a s t
Food
s t a b l i s h m e n t [ ] . Order t 2 .
58.
F u r t h e r ,
f
h e
Wag e Board
were
e r m i t t e d
t o l o o k beyond
h e employee-
s p e c i f i c
c r i t e r i a
mandated
b y
t a t u t e
( s e e supra I ) , h e n t must
l s o
a d e q u a t e l y c o n s i d e r
t h e
f u l l
impact
of
t s
recommendations,
n c l u d i n g t h e
impact
on
m p l o y e r s . But,
y
a s i n g
t s
r a t i o n a l i z a t i o n
f o r
t h e
wage
n c r e a s e
on
a t i o n a l c o r p o r a t e f r a n c h i s o r s ' f i n a n c i a l s , h e Board
w h o l l y f a i l e d
t o
c o n s i d e r t h e n e g a t i v e impact h a t t s recommendations i l l have on m a l l b u s i n e s s f r a n c h i s e e s .
5 9 . I t
d e f i e s
l o g i c t o
b e l i e v e t h a t
a
m a l l
b u s i n e s s
w i t h s m a l l
m a r g i n s i s equipped o
a b s o r b
a
wage
n c r e a s e due o b r a n d
r e c o g n i t i o n (which
a
wage
n c r e a s e does
o t
a f f e c t ) . See
Report t
1 9 .
To h e c o n t r a r y , h o s e s m a l l b u s i n e s s e s w i l l be o r c e d t o
r e d u c e
employment,
a i s e
p r i c e s , and
n c r e a s e
r e l i a n c e
on government n v o l v e m e n t . See
Lewin r e l i m i n a r y
R e p o r t .
I n
s um ,
h e B o a r d ' s
recommendations u r t e x a c t l y t h e p o p u l a t i o n
t h e y
s e e k t o
s u p p o r t . The
Order
a d o p t i n g t h o s e
recommendations s
t h e r e f o r e
a r b i t r a r y , c a p r i c i o u s , and
u n s u p p o r t e d
by
h e
e v i d e n c e .
V.
The O r d e r i o l a t e s
t h e
U.S.
o n s t i t u t i o n .
A. The O r d e r
runs
f o u l
of
h e Do r m a n t Comme r ce Clause, a n d h e
F i r s t and
Fourteenth
Amendments.
60.
The
Order m p r o p e r l y d i s c r i m i n a t e s a g a i n s t i n t e r s t a t e
commerce b y
u r d e n i n g
o n l y n a t i o n a l c h a i n s
whose
r a n c h i s e e s
s h a r e
c h a r a c t e r i s t i c s
w i t h
o t h e r s
o u t s i d e
ew
ork.
See
U.S. o n s t .
r t . I §
,
13;
W. Lynn
Creamery,
n c .
v .
Healy, 1 2 U.S.
8 6 ,
20 1
-02 1 9 9 4 ) .
So
19
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w h i l e New
ork
C i t y
c h a i n s (with 30
r
more
e s t a u r a n t s
w i t h i n t h e s t a t e )
w i l l
pay h e i r
employees $9 .00
p e r
hour a s of
December 31,
015,
a t i o n a l
c h a i n s
w i t h
30
r
more o c a t i o n s
a c r o s s t h e U.S.
i l l
pay h e i r
employees $10.50
p e r h o u r .
Such a e s u l t
v i o l a t e s
t h e dormant
Commerce C l a u s e .
61. The Order l s o v i o l a t e s
t h e
F i r s t Amendmen t
by
b r i d g i n g
f r a n c h i s e e s ' freedom
t o a s s o c i a t e
with
n a t i o n a l c h a i n s .
I n e s s e n c e , h e
Order o f f e r s
s m a l l b u s i n e s s owners
a Hobson's
c h o i c e , between
remaining a s s o c i a t e d w i t h a a t i o n a l
c h a i n
and p o s s i b l y going out of u s i n e s s
due o r i s i n g l a b o r c o s t s , and
s h e d d i n g t h a t a s s o c i a t i o n .
See Bates
C i t y
o f
i t t l e Rock,
361
U.S.
516,
2 2
-23
1960)
n o t i n g
f r e e
a s s o c i a t i o n
i s
p r o t e c t e d
n o t o n l y
a g a i n s t
heavy
-
handed
r o n t a l
a t t a c k , but l s o
from b e i n g
s t i f l e d by more
u b t l e governmental n t e r f e r e n c e ) .
62.
In a d d i t i o n , t h e Order
i o l a t e s
t h e Equal
r o t e c t i o n
Clause because t
t a r g e t s
s m a l l
b u s i n e s s f r a n c h i s e s , m a n y
of which a r e o wned by
women
nd
m i n o r i t i e s .
C f Washington
Davis,
426
U.S.
229,
41-42 1 9 7 6 ) .
Such l l e g a l
and d i s c r i m i n a t o r y t r e a t m e n t
cannot
be
a l l o w e d .
63. The
O r d e r ' s
d e f i n i t i o n of h e Fast Food
E s t a b l i s h m e n t s t h a t
a r e
s u b j e c t t o
t h e
Order s vague and ambiguous.
See Order
t
-3
a d o p t i n g Board's d e f i n i t i o n ) ;
s e e a l s o Report
a t
21. I t a p p e a r s
t h a t t h e
Board
meant o
apply
t s
m i n i m u m
w a g e
recommendations
only
o f a s t
food c h a i n s with
a t
l e a s t 3 0 1 o c a t i o n s
n a t i o n a l l y .
See
Report
t
1 6 ; see a l s o
Appendix
o t h e
Report
l i s t i n g
f a s t
food c h a i n s i n New
ork
t a t e
w i t h
30
r
more o c a t i o n s
n a t i o n w i d e
a s of
2014
) .
I t
does not
p p e a r ,
h e r e f o r e ,
h a t
t h e
Board
i n t e n d e d
t o
i n c l u d e w i t h i n
i t s
recommendations
h o s e f a s t
food
c h a i n s whose
3 0 1 o c a t i o n s
a r e
e n t i r e l y
w i t h i n
t h e
S t a t e
of
New
York, r
t o
a n c i l l a r y
f o o d s e r v i c e companies
h a t
s u p p o r t
b u s i n e s s e s , h o s p i t a l s ,
s p o r t s
a r e n a s , and
s c h o o l s .
B u t h e Order s not
l e a r ; t h i s
ambiguity
i s
c r e a t i n g
c o n f u s i o n
f o r
b u s i n e s s e s a s t h e y
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t r y
t o
d e t e r m i n e
w h e t h e r
t h e y
a r e
a f f e c t e d
by
h e O r d e r . As
u c h ,
i f
h e
IBA
oes
n o t a n n u l
t h e
Order a l t o g e t h e r
(which
t
s h o u l d ) ,
t h i s
body must
l a r i f y t h a t
t h e
O r d e r ' s
d e f i n i t i o n o f
F a s t
F o o d
E s t a b l i s h m e n t s
o n l y
a p p l i e s
t o t h e l i m i t e d band o f e s t a u r a n t s t h e
Board