Business Coalition Challenges Austin Sick-Leave Plan

Date: May 03, 2018


A business coalition has challenged Austin’s sick-leave plan.

The coalition is partly made up of the Texas Association of Business and the NFIB, and the group is represented by the Texas Public Policy Foundation. Filed in Travis County State District Court in late April, the lawsuit challenges the two-month-old ordinance that requires most private businesses in Austin must provide paid sick leave, according to My Statesman.

The sick-leave mandate is not scheduled to go into effect until Oct. 1. The ordinance would require most private Austin employers to give each worker up to 64 hours—or eight full eight-hour workdays—of paid sick leave per year. Small businesses with 15 or fewer employees are required to only meet 48 hours of paid sick leave per year, or six workdays, according to My Statesman.

“We needed to move quickly and stop any bleeding that might occur from this ordinance,” said Jeff Moseley, chief executive of the Texas Association of Business, which is the state’s most powerful business lobbying group, as quoted by My Statesman. “It’s overreaching [by the city government], and it’s hard-hitting to small employers.”

Representatives of the business organizations that jointly filed the lawsuit say that Austin employers are already spending on resources in anticipation of the Oct. 1 start date.

The coalition argues that the ordinance violates the Texas Minimum Wage Act. According to My Statesman, the state law explicitly prevents localities from requiring private employers to pay above the federal minimum wage, which the Austin municipal government would be forcing them to do so if the ordinance goes into effect. The lawsuit rests on the fact that paid sick leave is a form of wages.

The coalition also claims that the ordinance violates various elements of the Texas Constitution. This includes a “substantive due course of law” clause requiring that an economic mandate be underpinned by facts that support an overriding government interest, according to My Statesman.

As quoted by My Statesman, Will Newton, state executive director of the National Federation of Independent Business, said many local employers consider the ordinance “a stab in the back” at a time when Austin already is becoming a city that’s too expensive in which to live or operate.

“[It] negatively affects the Texas business climate overall, especially if other cities follow Austin’s lead,” Newton is quoted as saying.

The coalition is pushing for a May 29 hearing for its request for a temporary injunction to prevent enforcement of the rules.


Related Content: Small Business News | Economy | State | Texas

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