Railroad Insurance Act Preempts Massachusetts Paid Sick Leave Law

The Railroad Unemployment Insurance Act (RUIA) preempts the Massachusetts Earned Sick Time Law (MESTL) in its entirety as it applies to interstate rail carriers, according to a recent decision by a Massachusetts federal district court.

In  2015, a railroad sued the Massachusetts Attorney General, arguing that the MESTL was preempted by three laws as it applied to interstate rail carriers: the RUIA, the Railway Labor Act and ERISA.  The parties agreed that the court would address the RUIA argument initially.  In 2016, the federal district court agreed that “RUIA preempt[s] all state laws, including the [Earned Sick Time Law] that relate to sickness benefits for railroad workers.” CSX Transportation, Inc. v. Healey (D. MA, July 13, 2016).

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On appeal, the First Circuit held that the MESTL provision dealing with benefits for an employee’s own medical condition was preempted by the RUIA but remanded the case to have the district court decide whether any other sections of MESTL were preempted by the RUIA or the Railway Labor Act or ERISA and whether any sections of the MESTL can survive as applied to interstate rail carriers. CSX Transp. v. Healey, 861 F.3d 276, 284 (1st Cir. 2017).

On remand, the district court concluded once again that “Congress intended RUIA to serve as the ‘exclusive’ source of all sickness benefits for railroad employees and to preclude the employees from claiming rights to sickness benefits under any state sickness law.”  The fact that MESTL allows time off for reasons other than the employee’s own sickness does not change the result, the court said. “In short, the breadth of the state law does not save it from RUIA preemption. Such a reading would allow a state to legislate creatively around the RUIA and thereby thwart the objective of Congress to create a uniform federal scheme of sickness benefits for railroad workers.”

Similar preemption challenges brought by an airline industry group to the Washington and Massachusetts PSL laws are pending.

More Texas Paid Sick Leave Turbulence

PSL winds are blowing strong in Texas.

In Dallas, PSL proponents submitted to city officials what they believed were sufficient signatures to allow voters to decide in November whether to adopt a PSL ordinance.  Their challenge grew yesterday when city officials said, according to a news report, that the number of valid signatures was 871 signatures fewer than the required number.

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PSL proponents in San Antonio also submitted what they believe are more than enough signatures to put PSL on the ballot in November. The city clerk must inform the City Council whether sufficient valid signatures have been submitted. If so, the City Council could choose to enact the PSL ordinance rather than send it to the voters. The next Council meeting is August 2.

In Austin, in April, a cadre of business interests sued to enjoin the implementation of the Austin Earned Sick Time Ordinance, which is effective in October. Noting that the case “has the aroma of a good political blood fight,” a state district court judge last month denied the injunction request, according to a news report. The denial does not end the litigation. The plaintiffs might appeal the district judge’s decision or proceed to litigate the substance of their claims.

The threat of state preemption of local PSL ordinances taints all of these PSL efforts. In the Austin case, the Texas Attorney General has intervened to argue that the Austin ordinance is preempted by the state’s minimum wage law. He has also written to San Antonio officials to inform them that they do not have authority to enact a PSL law, whether by ballot initiative or the legislative process, according to a local report. Even if state law now does not preempt local PSL laws, there is concern that the Texas Legislature will enact a law preempting local PSL ordinances when it convenes next year. Texas preemption laws have recently banned local ride-share regulations, plastic ban bans, fracking bans and sanctuary city ordinances.

There’s PSL turbulence in Texas, and it is not likely to end soon.

Paid Sick Leave Turbulence in Texas

There’s paid sick leave turbulence in the Lone Star State. Austin passed its PSL ordinance in February, the first PSL law in the South.   Last month, PSL advocates in San Antonio submitted signatures to support their effort to have voters decide in November whether to enact a PSL ordinance. And this week, PSL advocates in Dallas have submitted signatures in support of a similar November ballot initiative there.

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PSL opponents have been busy as well. In April, a cadre of business interests sued to enjoin the implementation of the Austin ordinance, which is effective in October. It claims the ordinance violates the state constitution and is preempted by the Texas Minimum Wage Law which requires employers to pay the federal minimum wage under the FLSA and does not require employers to pay for time not worked as the Austin PSL ordinance does.  The State of Texas has intervened in support of the minimum wage argument. PSL advocates have intervened to defend the ordinance.

Beyond that, Texas Governor Greg Abbott has been vocal in his displeasure with local PSL laws (see here), raising the possibility that if the Austin ordinance survives the litigation, the next threat to its existence may be a preemption law. Texas preemption laws have recently banned local ride-share regulations, fracking bans and sanctuary cities.

The first PSL ordinance in the South, two ballot initiatives, a PSL litigation cloud , and a possible preemption law combine to create PSL turbulence in Texas.

 

 

Turning the Paid Sick Leave Page to 2018

As we turned the PSL page to a new year, the vast and complex patchwork of PSL laws consisted of more than 40 laws: 8 state laws, the District of Columbia, 2 county laws and about 30 municipal laws.

The Rhode Island Healthy and Safe Families and Workplace Act was the only PSL law enacted in 2017, the fewest number of PSL laws enacted in a year since 2011.  The Maryland and Nevada legislatures passed PSL bills last year but, in each case, the governor vetoed the bill. On January 11, 2018, the Maryland legislature overrode that veto, making Maryland the ninth PSL state.

In the only 2017 PSL referendum, Albuquerque voters very narrowly rejected the Healthy Workforce Ordinance.  Prior to the vote, lawsuits challenged the manner in which the proposal would be printed on the ballot and its constitutionality.

Paid Sick Leave Laws Effective in 2017

Nine PSL laws went into effect in 2017. While the Spokane ordinance is one of these, it “sunset,” became null and void, on January 1, 2018.  Also, while the Cook County ordinance went into effect in 2017, approximately 80% of the municipalities within the County have opted out of complying with the Ordinance. The nine are:

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Other political subdivisions

Paid Sick Leave Laws Effective After 2017

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Other political subdivisions

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Paid Sick Leave Bills Introduced During 2017 Continue reading

Rhode Island is “State Number Eight” to Pass Paid Sick Leave Law

The wait for “State Number Eight” to pass a paid sick leave law is over. Rhode Island has claimed that title.

The Rhode Island General Assembly convened yesterday for a “cleanup session” to deal with some bills that were pending when the regular session ended. During the regular session, both the Senate and the House had passed paid sick leave bills, but the session ended before they were reconciled. Yesterday, both the House and the Senate passed a compromise bill. Governor Gina Raimondo has said previously that she supports paid sick leave and is expected to sign the bill, which would be effective July 1, 2018.eight-33992_1280

A few observations about the bill:

  • Employees accrue one hour of leave for every 35 hours worked. In the other states, the accrual rate is one hour for every 30 or 40 hours worked.
  • The maximum annual accrual ramps up from 24 hours in 2018, to 32 in 2019, and to 40 for later calendar years.
  • For a foreseeable need to use leave, the bill requires employees “to schedule the use of sick and safe leave time in a manner that does not unduly disrupt the operations of the employer,” a concept in the Americans with Disabilities Act.
  • Meeting the “safe harbor” requirements will likely be easier compared to other states because employers who offer the required amount of annual time off are excused from complying with some of the bill’s procedural requirements.
  • The bill has the most comprehensive provisions concerning fraudulent use of PSL of any PSL law in the country.
  • The bill makes Rhode Island a preemption state. A “uniformity” clause prohibits municipalities from requiring employers to provide more paid sick and safe time than is required by the bill.

The Rhode Island bill is the first PSL bill of 2017. Albuquerque voters will be voting on a PSL initiative in two weeks, on October 3.

Arizona’s Preemption Law Unconstitutional, Court Rules

Arizona’s 2016 law prohibiting its political subdivisions from regulating employee benefits and “non-wage compensation,” is unconstitutional because it contradicts a 1998 law passed by voters which limits the legislature’s ability to modify voter-approved initiatives, according to a decision last week by Maricopa County Superior Court Judge Joshua D. Rogers.

The 1998 law, the Voter Protection Act, prohibits the legislature from amending or superseding a voter-approved initiative unless the proposed law “furthers the purposes” of the initiative and is approved by three-fourths of both the House and the Senate.

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In 2006, Arizona voters approved Proposition 2002, which states in part, “a county, city or town may by ordinance regulate minimum wages and benefits within its geographic boundaries” but may not reduce the minimum wage below that required by state or federal law.

Ten years later, the state passed its preemption law, which states in part: ‘The regulation of employee benefits, including nonwage compensation, paid and unpaid leave and other absences, meal breaks and rest periods, is of statewide concern. The regulation of non-wage employee benefits pursuant to this chapter and federal law is not subject to further regulation by a city, town or other political subdivision of this state.” This bill did not garner a three-quarters margin in either legislative chamber.

The court rejected the State’s claim that Proposition 202’s allowing a political subdivision to regulate wages and benefits did not contradict the preemption law’s prohibiting a political subdivision from regulating wages and benefits. The court said that these “two statutes cannot be harmonized because [the preemption statute] expressly prohibits that what [Proposition 202] expressly permits.”

Arizona voters enacted the Fair Wages and Healthy Families Act last November. It went into effect on July 1, 2017. Last week’s decision creates the possibility that an Arizona city or town or other political subdivision could enact a more generous paid sick leave law.

The State must decide whether to appeal the decision.

 

Minnesota Governor to Veto Paid Sick Leave Preemption Bill

Minnesota DFL Governor Mark Dayton said he would veto the Uniform Labor Standards Act, the bill passed by the Minnesota legislature which would preempt municipalities from enacting a sick leave law, among other employment regulations.  In a statement, the Governor said, in part: “It is unconscionable that Republican legislators would pit the earned financial security of hardworking state employees and retirees against the rights of local officials to make the decisions for which they were elected by their citizens….”

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MN Governor Mark Dayton

Since the bill did not pass either chamber by a two-thirds margin—the margin needed to override the Governor’s veto—the veto effectively kills the preemption bill. The bill would have voided the Minneapolis and St. Paul Sick and Safe Time ordinances, both scheduled to go into effect on July 1, 2017.

The Governor’s veto does not end the Minnesota PSL Melee, described here. His veto leaves the fate of the Minneapolis and St. Paul PSL ordinances in the hands of the judicial system.  In mid-January 2017, a Hennepin County District Court enjoined implementation of the Minneapolis ordinance with regard to employers located outside of the city’s geographical boundaries but denied the injunction with regard to employers within those boundaries.  My post about that decision is here. An appeal of that decision is pending in the Minnesota Appellate court.  The outcome of that appeal would also likely affect Duluth, where an Earned Sick Leave Task Force has been studying the issue and holding hearings in anticipation of making a PSL recommendation to the City Council.