U.S. Chamber Challenges 'Living Wage' Law

WASHINGTON, D.C. — The United States Chamber of Commerce filed an amicus brief challenging a New Orleans municipal law establishing a "living wage" for the city, which violates a Louisiana state law that prohibits local governments from setting their own minimum wages.

"Living wage ordinances lessen job opportunities for those at the bottom of the economic ladder while increasing costs for all citizens," said Stephan Bokat, executive vice president of the National Chamber Litigation Center (NCLC) — the legal arm of the U.S. Chamber.

In a brief filed in the Supreme Court of Louisiana, NCLC argued that the New Orleans "living wage" ordinance violated a Louisiana statewide law. The New Orleans Regional Chamber of Commerce, the Chamber of Greater Baton Rouge, the Natchitoches Area Chamber of Commerce, and the Thibodaux Chamber of Commerce joined the Chamber in its brief.

Living wage proposals are economically unfair because they change the basis on which our economy operates, according to the Chamber. Instead of allowing market forces to determine pay, living wages put the interests of employees above all other considerations. Wage mandates ignore the principles of free market economics; they prevent businesses from making profits, growing, and hiring more workers; and they base wages on what the worker wants instead of on the value of work performed.

"The negative consequences of mandated wage increases will fall disproportionately on those with the fewest skills and the least experience and will hit small businesses the hardest," said Giovanni Coratolo, Chamber director of small business policy.

When labor costs rise, new entry level jobs that would have been created never materialize and employer-provided benefits such as health care and on-the-job training are scaled back to absorb the increase in labor costs, according to the Chamber.

The U.S. Chamber of Commerce is the world's largest business federation representing more than three million businesses and organizations of every size, sector and region.

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