A State Supreme Court judge ruled in favor of the Bloomberg administration Monday, striking down the prevailing wage law passed by the City Council last year.
The law would have required businesses that receive at least $1 million from the city to pay workers at a rate higher than the state's minimum wage.
The state judge ruled on Monday that the law is invalid because it was preempted by the state's minimum wage law.
Mayor Michael Bloomberg had vetoed the legislation, saying it would drive businesses away from the city, but the Council overrode his veto.
City Council Speaker Christine Quinn's office released a statement Monday night that said, "We disagree with the judge’s decision and will take appropriate legal steps to have it overturned."