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LABOR & EMPLOYMENT LAW — 01/08/09

Lawsuit challenges city of Milwaukee’s paid sick leave mandate

Calling it “a fight we cannot afford to sit out [of],” the Metropolitan Milwaukee Association of Commerce (MMAC) filed suit on December 22, 2008, challenging the city of Milwaukee’s paid sick leave mandate. MMAC represents 2000 member companies, employing nearly 500,000 workers throughout the metropolitan Milwaukee area.

“This one-size-fits-all mandate is not only bad economic policy, it is also bad law,” said MMAC President Tim Sheehy. “We believe this measure interferes with employers’ rights to negotiate labor agreements with their employees and is an illegal extension of the city of Milwaukee’s authority into areas of law and regulation reserved to the state.”

Background. On November 4, Milwaukee became the third city in the United States, after San Francisco and the District of Columbia, to require that all city businesses provide their employees with paid sick leave through the passage of a binding referendum. Milwaukee’s paid sick leave mandate takes effect February 10, 2009.

The binding referendum provides that all private sector employees employed within the city will accrue one hour of paid sick leave for every 30 hours worked, but no more than 72 hours of paid sick leave per calendar year (i.e., nine paid sick days per year with accruals to be carried over from year to year to a maximum of 72 hours). Employees of a “small business,” defined as a company with fewer than 10 workers (including part-time and temporary workers), accrue a maximum bank of 40 hours per calendar year (i.e., five paid sick days per year). Employees begin to accrue paid sick leave immediately upon beginning their employment, but are not entitled to use the accrued sick leave until the 90th calendar day following the start of employment. The referendum applies to full-time, part-time and temporary employees, salaried or hourly workers.

Paid sick leave can be used by an employee for his or her own physical or mental condition and for any preventative medical care. It can also be used for a family member’s physical or mental condition or preventative medical care. A “family member” is broadly defined to cover the child, spouse, parent, grandparent, grandchild, “spouse of a biological, foster or adopted sibling,” “domestic partner,” and “any other individual related by blood or affinity whose close association with the employee is the equivalent of a family relationship.” The referendum also guarantees leave for employees dealing with domestic abuse, sexual assault or stalking. Further, “an employer may not require disclosure of information relating to...the details of an employee’s medical condition as a condition of providing sick leave.” The ordinance also contains notice posting, anti-retaliation and enforcement provisions. The referendum can be found at: http://www.mmac.org/ImageLibrary/Public/MMAC_PDF_folder/Milw_Ord._File_080420.pdf.

Legal challenge. On November 5, MMAC filed a notice of claim stating that the ordinance: (1) is inconsistent with federal (Family and Medical Leave Act) and state laws (Wisconsin Family and Medical Leave Act) governing family and medical leave; (2) exceeds the legislative powers conferred upon the city of Milwaukee as it is an attempt to set a living or minimum wage; and (3) exceeds the legislative powers conferred upon the city of Milwaukee as it improperly attempts to regulate employers located outside the geographic boundaries of the city ( i.e., it would require paid sick leave from employers outside the city that have employees living in Milwaukee).

On November 17, MMAC’s Board of Directors authorized a legal challenge to the mandate. MMAC is represented by the law firm of Michael Best & Friedrich LLP.

The complaint seeks declaratory judgment and injunctive relief. It realleges much of the same arguments that MMAC asserted in its notice of claim. As part of its suit, MMAC also requests that the Circuit Court of Milwaukee County enter a temporary injunction blocking the city from enforcing the mandate while the court considers its validity.

“We do not take suing the City lightly,” said Sheehy. “This has the potential to be a long and extremely costly fight. However, the negative ramifications of this mandate are so extreme for our member companies and our regional economy that we are convinced it is a fight we cannot afford to sit out.”

For more information on this and other topics, consult CCH Employment Practices Guide or CCH Labor Relations.

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