For years, labor leaders and advocates for employees toiling at New York City’s 200 carwashes have been in a battle with the owners of the businesses over wages and working conditions, including the right to join a union.

Owners have largely resisted unionization, claiming it would put the carwashes out of business. Unions have cited an untenable situation in which vulnerable workers — many of whom are undocumented immigrants — say their tips and wages are stolen in an industry where abuse has been well documented.

Now, the focus of the contentious fight is shifting from picket lines and back-room negotiations to City Hall. On Wednesday, the City Council is scheduled to vote on a bill that would more rigorously regulate the industry by requiring carwash owners to obtain a license for the first time.

Supporters — including the Council speaker, Melissa Mark-Viverito, who first introduced the bill in 2012 — say the measure is long overdue to protect workers who are often exploited.

“We don’t want to tolerate wage theft and we don’t want to tolerate inhumane work conditions,” Ms. Mark-Viverito said in an interview on Monday. “We’re creating a level playing field for the carwash workers, and closing businesses which are terrible and making sure they are operating within the laws. It’s really exciting that we’re finally here.”

But carwash owners say leaders with the Retail Wholesale and Department Store Union have been using the possibility of the bill’s passage as leverage to compel them to accept efforts to organize their workers.

On Tuesday, a Council committee voted 4 to 0 in favor of the bill, making it increasingly likely that the full Council will pass it.

About 30 carwash owners protested in the back of the committee room, wearing yellow shirts that implored Council members to vote no: “Don’t Be a Job Killer.” The owners, shouting that they wanted a fair hearing, were escorted out.

The owners are concerned about their already slim profit margins in a business that is fiercely competitive, with some owners charging low prices for washes while paying workers drastically low wages.

What has particularly upset owners is the bill’s requirement for indemnity. Owners without a union shop must obtain a bond of $150,000 as a guarantee should they be found to have cheated their workers. Those who support a union at their carwash would need only a $30,000 bond, since, advocates said, workers would have stronger protections.

“Plain and simple, this is a legislative extortion scheme,” said Steve Rotlevi, the owner of Zoom Car Spa in Brooklyn and the president of the Association of Car Wash Owners, which represents 100 of the approximately 130 owners in the city.

Though the amounts were under negotiation for three years, the owners were upset there was no public hearing over the final numbers, which were added in the last two weeks. Owners say poor credit would make it difficult to secure a bond.

“The City Council, the R.W.D.S.U. and Make the Road, they know full well that we will not qualify and can’t afford a $150,000 bond, which is why they are requiring it: to force this industry into mass unionization,” Mr. Rotlevi said.

Only nine carwashes in the city are unionized, despite a citywide organizing effort begun in 2012 by two advocacy groups, Make the Road New York and New York Communities for Change, along with the retail workers’ union.

The fight over the bill comes at a time of intense focus on the plight of low-income and hourly workers, including campaigns to raise the minimum wage.

It also comes less than two weeks after the New York State Labor Department interviewed carwash workers in New York City and then raided eight carwashes as part of an investigation into wage violations and working conditions, said Stuart Appelbaum, the president of the retail workers’ union. A Labor Department spokesman confirmed the sweeps, and that an investigation was continuing.

In 2014, John Lage, one of the largest carwash operators in the city, was forced to pay more than $3.9 million in fines and back wages after an investigation by the state attorney general, Eric T. Schneiderman. Mr. Lage’s son Michael Lage and another owner, Fernando Magalhaes, were also part of the settlement. In 2009, John Lage paid $3.4 million after a lawsuit.

A State Labor Department investigation in 2008 found that nearly eight in 10 carwashes in New York City violated minimum wage and overtime laws. At 84 carwashes across the state, investigators said owners owed $6.5 million to 1,380 workers.

The Association of Car Wash Owners formed three years ago in response to the proposed Council bill. Mr. Rotlevi said that the association had sponsored workshops every six months to educate their owners about complying with labor laws.

Martin Taub, the owner of three carwashes in Brooklyn, Manhattan and the Bronx, said if the bill passed he would have to reduce his work force to two workers from about 25, eliminating the workers for interior detailing and hand-drying.

“It’s a power play by the unions,” Mr. Taub, 64, said after the hearing on Tuesday. “Tomorrow we’re going to try and change their minds in some way.”

But some workers said that the union benefits were clear. Refugio Denicia, 36, from Mexico, was making only $4 an hour for a 60- to 80-hour workweek before he and his workers voted to unionize at Five Star Car Wash in Elmhurst, Queens. Now he is making more than twice that.

“I am very excited because now the owners will have to follow the law and they won’t abuse the workers or withhold their pay,” Mr. Denicia said in an interview in Spanish through an interpreter.

Councilman Daniel Dromm, a Queens Democrat representing Elmhurst and Jackson Heights, said, “It’s a historic day for those ‘carwasheros’ that we have had this long battle for.”

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