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.

Litigating Paid Sick Leave in the Land of Enchantment

Two paid sick leave lawsuits are pending in New Mexico, the Land of Enchantment. Both deal with the effort to have a voter referendum in Albuquerque in October 2017 on a local Healthy Workforce Ordinance (HWO).

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Albuquerque

One lawsuit deals with how the HWO must be presented on the ballot. A district court judge ruled last fall that the entire seven page ordinance must be on the ballot; a summary was not sufficient. An appeals court earlier this month rejected the HWO proponents’ request that an appeals court review that issue while the case is still pending in the district court. Apparently the seven page ordinance could fit on a double-sided one page ballot, according to one report. Watch for arguments by HWO opponents concerning appropriate margins and font size.

In the other lawsuit, a cadre of business interests claim that the HWO is unconstitutional “logrolling” because it combines multiple issues on the ballot, depriving voters of the opportunity to vote separately on each one. My post on that lawsuit is here.  Last December, an Arizona court had rejected an analogous “single subject” argument challenging the state-wide PSL ballot initiative held last November. Earlier this month, a Washington court reached the same result in a case challenging its state-wide PSL ballot initiative held last November.  My posts on those decisions are here and here.

On a Land of Enchantment PSL preemption note, the Uniformity of Employment Law Terms had been introduced in the New Mexico Senate this legislative term but died in committee when the session ended.  Senate Bill 488 would have prevented political subdivisions from enacting paid sick leave laws, among other employment terms.

Paid Sick Leave Preemption Showdown in Minnesota

The Minnesota paid sick leave melee intensified last week when the state Senate passed the Uniform Labor Standards Act, a preemption bill barring municipalities from requiring private employees to provide paid sick leave and other employment standards. The House passed a very similar bill in March.  Once the bills are reconciled, the final version will be sent to DFL Governor Mark Dayton for his signature. The Governor has not taken a public position on the bill.

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If signed by the Governor, the bill would void the Minneapolis and St. Paul Sick and Safe Time ordinances, both scheduled to go into effect on July 1, 2017. As a practical matter, the bill would resolve the legal challenge to the Minneapolis ordinance pending in the Appellate Court and end the work of the Duluth PSL Task Force. The Minnesota melee would be over, at least for the time being.

If the Governor vetoes the bill, a two thirds vote in each chamber is needed to override that veto.  The bill did not pass either chamber by a two-thirds margin so an override is unlikely. Absent an override, the Minnesota melee will continue, with a decision by the Appellate Court likely to be the next event.

This is the second PSL showdown pending. As noted in an earlier post, the Maryland General Assembly send a PSL bill to Governor Hogan, who described it as “job-killing” and said it was “dead on arrival.” He has not yet acted on the bill. The General Assembly passed that bill with sufficient votes in both houses to override the Governor’s veto. Since the Maryland legislative session has ended, if the Governor vetoes the PSL bill, the override vote will not occur until January 2018, when the legislature reconvenes.

South Carolina Becomes a Paid Sick Leave Preemption State

Add the Palmetto State to the list of PSL preemption states. Governor Henry McMaster signed SB218 into law last week.  The law prohibits a political subdivision from establishing, mandating or otherwise requiring an “employee benefit,” defined as “anything of value that an employee receive from an employer in addition to wages.” Paid sick leave is listed as an example of an employee benefit.

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Arkansas and Iowa have already enacted PSL preemption laws this year. There are now 17 PSL preemption states.

I anticipate Georgia Governor Nathan Deal will sign HB243 soon. Georgia is already a PSL preemption state. HB243 amends the preemption law to prevent municipalities from requiring employers to provide “additional pay based on schedule changes,” a response to the growing interest in “secure scheduling” ordinances.

On the state PSL front, we continue to wait for State Number Eight. Maryland seemed to be in the forefront but if Governor Hogan vetoes the bill sent to him, as he has promised to do, the General Assembly will not have an opportunity to vote to overturn his veto until January 2018.

Of the other pending state PSL bills, those in Hawaii, Rhode Island and Nevada seem to be moving through the legislative process but it is too early to predict whether any of these will be State Number Eight.

Preemption Laws Outnumber Paid Sick Leave Laws This Year

Local paid sick leave laws and state laws preempting those laws are the duality of the PSL debate. The yin and yang of the issue. Judging by 2017 events, the momentum seems to have swung markedly toward state laws banning municipalities from enacting PSL bills.

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Within the past week, the governors of Arkansas (Act 643) and Iowa (HF 295) have signed into law typical PSL preemption bills, “typical” meaning that the law bars political subdivisions from enacting PSL requirements that exceed state or federal law.   Earlier this year, as I noted in an earlier post, Ohio joined the list of PSL preemption states.

That list is likely to have two more additions very soon. Both houses of the Georgia and South Carolina legislature have enacted PSL preemption bills. Both states have Republican governors.

On the PSL side of the duality, no local government has enacted a PSL law thus far in 2017, though a few are pending. On the state front, we continue to wait to see, and handicap, which state will become the eighth state to enact a PSL law.  In January, I posted that, applying my cryptic and always dangerous political analysis, described generally here, Maryland and Rhode Island were more likely than not to enact a PSL law this year. The Maryland legislative session ends in just a few days, on April 10. The Rhode Island session continues into June. But, as noted in my recent PSL quarterly report, PSL bills are pending in more than a dozen states so State Number Eight might not be either Maryland or Rhode Island.

A Minnesota Paid Sick Leave Preemption Bill That Isn’t

One more piece to the Minnesota Melee I had posted about here.  In addition to the preemption and PSL bills that have been introduced in Minnesota, another bill, a bill of a type I have never seen in all my meanderings through PSL bills, has been introduced. House Bill 2107 does not prohibit a city from enacting a PSL law. To that extent, it is not a preemption bill. However, it directs that if a city enacts a PSL law (or increases the minimum wage or adopts scheduling restrictions) for employees other than its own city employees, the city forfeits the local government aid it would otherwise receive from the state. The amount of aid to each city is determined annually according to a statutory formula. More than $519 million in local government aid will be distributed in 2017, according to the state Department of Revenue.

cash-1296585_1280The financial forfeiture makes this non-preemption bill feel like a preemption bill. While legislators would be able to say that they did not prevent cities from enacting a PSL law, the reality is that the forfeiture will likely prevent cities from enacting a PSL law!  The concept of using financial forfeiture to coerce compliance is not new. The federal government uses this approach with states often. A state’s application of the concept to PSL would be new.

Pittsburgh and Philadelphia: A Tale of Two Paid Sick Leave Laws

Why was Pittsburgh’s Paid Sick Days Act struck down by a court yet the Philadelphia PSL law has not even been challenged in court?  An Allegheny County judge struck down the Pittsburgh PSL ordinance in December pgh-america-2053302_12802015 after finding that the city did not have the authority to enact it under the Pennsylvania Home Rule Charter and Optional Plans law. That law prohibits Home Rule Charter municipalities from determining “duties, responsibilities or requirements placed upon business, occupations and employers,” with limited exceptions.  An appeal of the judge’s decision is pending.

The Allegheny Institute for Public Policy, a non-profit research and education organization, recently issued a “Policy Brief” entitled “Time for Pennsylvania to Rein Muliberty-bell-656871_1280nicipal Regulations on Business.” It notes that the Home Rule Charter law specifically exempts Philadelphia from its prohibitions and recommends that the Commonwealth remove that exemption and bar municipalities “from enacting regulations not expressly permitted by the state,” i.e., a type of preemption law.

The Policy Brief notes that the Senate is considering a preemption bill, SB 128, as I had noted here.  The Policy Brief opined, as did I in my post, that even if both chambers of the legislature were to pass SB 128,  the Republicans do not have sufficient numbers in the House to overturn Democratic Governor Tom Wolf’s likely veto.