Thursday, May 8, 2014
A recent opinion piece in Al Jazeera America (H/T Sam Bagenstos, @sbagen) calls attention to the ongoing lobbying efforts of the American Legislative Exchange Council (ALEC) and the National Restaurants Association to pursue state laws preempting local employment regulation. The piece focuses primarily on the preemption of local laws requiring that employers offer paid sick leave or pay a higher living wage or minimum wage. A number of cities have enacted mandatory paid sick leave laws (with varying eligibility requirements), including San Francisco, Seattle, New York City, Washington D.C., Portland, Oregon, and Jersey City, New Jersey.
Several states have enacted legislation preempting, to varying degrees, the ability of local governments to regulate employers. These states include Wisconsin, Florida, Mississippi, Arizona, Indiana, Tennessee, Louisiana, Kansas, and as of April 14, Oklahoma. The Oklahoma law heads off an initiative to raise the minimum wage in Oklahoma City to $10.10 per hour. Florida enacted its own preemption law in 2013 and, as part of that legislation, convened a task force to study the preemption question. (Disclosure: In October, I testified before this task force.). Florida’s law does not preempt living wage ordinances, but it does preempt local minimum wage laws and local laws requiring the provision of benefits not otherwise required by federal or state law.
States are considering the extension of preemption beyond just minimum wages and sick leave. For example, in Florida, there are no wage payment and collection protections to speak of, other than a requirement to pay in cash or a negotiable instrument. In response to a perceived wage theft problem, some local governments in Florida, including Miami-Dade County, have enacted wage theft ordinances. Bills were introduced in the Florida House and Senate to preempt (with certain exceptions) any new local wage theft laws, although such efforts have been unsuccessful thus far.
The primary justification offered for state level preemption of local employment laws is that it would be too difficult for employers to comply with a patchwork of differing local employment laws. Indeed, this is the very first reason listed in the Florida Task Force’s Final Report, which concludes that preemption of local laws was the appropriate course. As someone who represented and advised employers for years, I am somewhat sympathetic to the compliance concern. But the compliance cost savings of uniform employment laws must be balanced against the benefits of decentralized regulation. Labor market conditions vary from city to city, just as they do from state to state. Why are uniform state laws necessarily preferable to a patchwork of local laws? The same interested parties making that argument would doubtless contend that the compliance cost savings of uniform federal employment regulation should often yield to the ability of states to craft a patchwork of differing employment laws that best suit the needs of the labor market within each individual state. Is it really the case that the state level is “just the right” level of uniformity for most employment regulation – neither too centralized nor too decentralized – or does it have more to do with who currently holds control over the legislative and executive branches at the state level?