Should Municipalities in Texas Regulate Wages and Benefits?

Once upon a time (February 15, 2018) the City of Austin passed a city ordinance requiring businesses to give employees paid sick leave. The law was challenged in court. Austin won the first round in district court. Business and the State of Texas won the second round in the 3rd Court of Appeals. See, e.g., Texas Ass’n of Bus. v. City of Austin, Texas, 565 S.W.3d 425, 440 (Tex. App.—Austin 2018, pet. filed). Austin appealed to the Texas Supreme Court, but the Supreme Court of Texas has not decided to hear the case yet.

Now, the city of San Antonio has an ordinance (August 16, 2018). The ordinance requires businesses to give employees one hour of paid sick leave for every thirty hours worked. April 24, 2019 Dallas passed a similar ordinance.

San Antonio businesses sued the city to block a municipal ordinance that requires businesses to give paid sick leave benefits to employees. 2019-CI-13921. The names plaintiffs are:

  • Associated Builders & Contractors of South Texas Inc.
  • American Staffing Association
  • BBM-Online LLC
  • Burnett Companies Consolidated Inc.
  • Cardinal Senior Care LLC
  • Choice Staffing LLC
  • Employers Solutions Inc.
  • Hawkins Associates Inc.
  • LeadingEdge Personnel Ltd
  • Staff Force Inc.
  • San Antonio Manufacturers Association
  • San Antonio Restaurant Association 

The Texas Attorney General intervened, which means The State of Texas opposes the ordinance because the Texas Minimum Wage Act preempts city regulations regarding wages. Chapter 62 of the Labor Code, the Texas Minimum Wage Act (“TMWA”), establishes and regulates wages in the State. TEX. LAB. CODE § 62.001–.205.

How does the paid sick leave ordinance conflict with the state minimum wage law? The paid sick leave ordinance requires employers to pay at least minimum wage for the time that the employee is sick.

The news reported on Friday that there is a temporary agreement between the parties that the City of San Antonio won’t enforce the law until December 1, 2019.

Comment with your thoughts about whether paid sick leave should be required or whether these city ordinances are preempted by the State minimum wage act.

One Response to Should Municipalities in Texas Regulate Wages and Benefits?

  • Whether the ordinances are preempted by the State Minimum Wage Act appears to me to be a legal question I am not qualified to answer. I do not believe, though, that cities ought to be involved in such matters regarding business and commerce. I think the San Antonio City Council is outside their area of responsibility and authority. Further, I think this ordinance, if enforced, will be quite detrimental to many small businesses.

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