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San Francisco's minimum wage will top out at $10.24 come January 1st -- the highest in the nation. Compare that with the $7.25 federal minimum and the statewide $8.00 an hour.
States are legally allowed to exceed the federal level, but in some jurisdictions, cities and counties are free to go even higher. San Francisco isn't the only locality to take advantage of this rule.
Santa Fe is expected to hit $10 in 2012. It, too, has passed a law requiring a yearly increase.
Restaurants and other employers are understandably concerned about such a high minimum wage. Some San Francisco business owners believe it will lead to layoffs and lost business, reports the Associated Press.
Unfortunately, there's not much that can be done about citywide minimum wages. Even if state law prohibits local raises, governing bodies have other legal options. Oddly enough, San Francisco is a great example of this loophole.
In addition to complying with San Francisco's minimum wage, local employers must offer health insurance or pay a fee to a local fund. It's not a direct wage increase, but employee benefits increase a job's worth.
Employers can't do much more than lobby against minimum wage increases and health care surcharges. However, they can let customers know what's going on.
Many San Francisco business owners have done just that. Instead of raising prices, owners place the health care surcharge directly on the bill, reports the Wall Street Journal. They list is out as a flat fee or as a percentage.
The same tactic may not work with San Francisco's minimum wage, but there are other ways to make the same point.