The progressive push for higher minimum wage laws has had perfectly predictable results: lower-income people are most harmed, businesses switch to robots, businesses shutter, or as in the case of west coast Restaurants Unlimited, Inc., they simply file for bankruptcy. The chain closed six restaurants prior to filing.

We’ve reported many such incidents here at Legal Insurrection.  Here’s just a sampling:

The latest victim of progressive ignorance about the real world impact of raising the minimum wage too high is Restaurants Unlimited, Inc. whose restaurants include Henry’s Tavern, Stanford’s and Kincaid’s.

Bloomberg reports:

Progressive wage policies helped force upscale eatery operator Restaurants Unlimited Inc. into bankruptcy, according to court documents filed Sunday.

The company, which operates 35 restaurants ranging from fine dining to “polished casual” eateries, including Henry’s Tavern, Stanford’s and Kincaid’s, filed for Chapter 11 protection in Delaware on Sunday. Minimum wage hikes, two disappointing restaurant openings and consumers shunning casual dining are to blame for the bankruptcy filing, Chief Restructuring Officer David Bagley said in court papers.

“Over the past three years, the company’s profitability has been significantly impacted by progressive wage laws along the Pacific coast that have increased the minimum wage,” Bagley said. “As a large employer in the Seattle metro market, for instance, the company was one of the first in the market to be forced to institute wage hikes.”

The company’s restaurants are concentrated in Washington, Oregon and California.

The company notes that the increased labor costs are unsustainable.

KATU News reports:

Over the past three years, the company said their “profitability has been significantly impacted by progressive wage laws along the Pacific coast.” As of now, Seattle’s minimum wage is $16 per hour for the company. Portland’s increased last week to $12.50 per hour. San Francisco’s is $15.59. Restaurants Unlimited says wage increases have increased their expenses by $10.6 million through the 2019 fiscal year.

In a statement to KATU News, a company spokesperson said, “The wage hikes — between 35% and 70% — have significantly increased our labor costs and have had a serious impact on the economics of the business. While striving to maintain the quality guest experience our customers have come to expect at our restaurants, management and staff at RUI have worked diligently to manage the impact of the wage increases which, in aggregate, far exceed the company’s net income.”

Before filing for bankruptcy, the company closed six restaurants, including two in Oregon: Prime Rib and Chocolate Cake in Portland and Portland Seafood Co. in Tigard. A spokesperson says there are “no immediate plans for additional closures.”

Six restaurants closed? That’s a lot of people out of work. I wonder how many of them would have loved to keep their jobs at a minimum wage their employer could manage?

[Featured image via YouTube]


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