AZ Supreme Court Rejects Paid Sick Leave Challenge

Just three days after hearing oral argument, in a one paragraph Order, the Arizona Supreme Court unanimously rejected the challenge by a cadre of business interests to the constitutionality of Proposition 206. That proposition increases the minimum wage in a series of steps and requires most Arizona employees to provide employees with paid sick leave beginning July 1, 2017. The Court said that it will issue a written opinion explaining its decision.courthouse-1223280_640

The plaintiffs had sought to enjoin the implementation of Proposition 206. With the injunction denied, and the Supreme Court’s  rejection of the Revenue Source Rule argument, plaintiffs must decide whether to pursue the other claims in their lawsuit.

 

AZ Supreme Court Hears Argument on Paid Sick Leave Proposition

The Arizona Supreme Court held oral argument last week on whether Proposition 206 violates the “Revenue Source Rule” of the state constitution. The 44 minute video archive of the oral argument is here. The Court will issue its decision in due course.

As I had written in a prior post, nearly 60% of courthouse-297664_1280Arizona voters approved Proposition 206 in November. Codified as The Fair Wages and Healthy Families Act, it raised the minimum wage to $10 per hour on January 1, 2017 and requires most Arizona employers to provide paid sick leave beginning July 1, 2017. The Arizona Chamber of Commerce and a host of other plaintiffs filed a lawsuit in December against the State of Arizona and a host of other defendants seeking to enjoin its implementation. In December, a Maricopa County Superior Court judge and then the Arizona Supreme Court denied the injunction request. The plaintiffs claim that the proposition violates the Revenue Source Rule because it will lead to increased costs to the state and it does not identify a revenue source to fund the additional cost, essentially an unfunded mandate.

Arizona Supreme Court to Hear Challenge to Paid Sick Leave Law

The legal wrangling over Proposition 206 will continue at the Arizona Supreme Court on one issue only: whether Proposition 206 violated the “Revenue Source Rule” of the state constitution. In a brief order last week, the Court scheduled oral argument for March 9.saguaro-232762_640

Arizona voters approved Proposition 206 in November by a nearly 60% margin. Codified as The Fair Wages and Healthy Families Act, it raised the minimum wage to $10 per hour on January 1, 2017 and requires most Arizona employers to provide paid sick leave beginning July 1,2017. The Arizona Chamber of Commerce and a host of other plaintiffs filed a lawsuit in December against the State of Arizona and a host of other defendants seeking to enjoin its implementation. In December, a Maricopa County Superior Court judge and then the Arizona Supreme Court denied the injunction request.

The plaintiffs claim that the proposition violates the Revenue Source Rule because it will lead to increased costs to the state and it does not identify a revenue source to fund the additional cost, essentially an unfunded mandate. They also claimed that the proposition violates the “Separate Amendment Rule” of the state constitution because the ballot question “cobble[d] together” distinct issues, denying voters the opportunity to vote on the minimum wage and PSL issues separately.  As noted above, the Supreme Court will hear argument on the Revenue Source Rule issue only.

Arizona Lawsuit Joins PSL Docket

Add another entry to the PSL litigation docket. The Arizona Chamber of Commerce and a host of other plaintiffs last week filed a lawsuit against the State of Arizona and a host of other defendants seeking to enjoin implementation of Arizona Proposition 206. Arizona voters approved that proposition by a nearly 60% margin in November. It raises the minimum wage in Arizona to $10 per hour on January 1, 2017 and requires most Arizona employers to provide paid sick leave beginning July 1, 2017.  saguaro-232762_640

The plaintiffs claim that the proposition violates the “Revenue Source Rule” of the Arizona constitution because it will lead to increased costs to the state and it does not identify a revenue source to fund the additional cost, essentially an unfunded mandate. It also alleges that the proposition violates the “Separate Amendment Rule” of the state constitution because the ballot question “cobble[d] together” distinct issues, denying voters the opportunity to vote on the minimum wage and PSL issues separately. The complaint also alleges that the proposition does not address the increased costs to Arizona business, especially those with tipped employees, although it is not clear to which legal argument this relates. The suit was filed in Superior Court in Maricopa County.

The Arizona lawsuit is the fourth pending case to directly challenge a paid sick leave law. The others are pending in Oregon, Minneapolis and Pittsburgh. A PSL-related case is pending in Alabama. My recent post about these cases is here.