On June 10, 2020, in its Minnesota Chamber of Commerce v. City of Minneapolis decision, the Minnesota Supreme Court upheld the City of Minneapolis’ Employee Sick and Safe Time (ESST) ordinance. In finding the ordinance enforceable, the Court found the City’s ordinance did not impermissibly: (a) conflict with state law or (b) reach beyond the boundaries of the city of Minneapolis. This decision has important implications not only for employers impacted by the City of Minneapolis’ safe and sick time ordinance, but also employers impacted by similar ordinance in St. Paul and Duluth.
Enacted in 2016, the Minneapolis ESST ordinance requires that all employees who work in Minneapolis for 80 or more hours per year accrue at least one hour of ESST for every 30 hours worked, up to a yearly maximum of 48 hours. Employees can also carry over unused ESST from year to year up to a maximum amount of 80 hours of total accrued ESST. Employers with six or more employees must pay employees for ESST leave. Additionally, the ordinance applies to all employees who work in Minneapolis for 80 hours in a year, regardless of whether or not the employer is based in Minneapolis or elsewhere.
The Minnesota Chamber of Commerce challenged the ordinance, arguing primarily that it was preempted by state law. The Chamber also argued that the ordinance’s purported application to employers based outside of Minneapolis was impermissibly “extraterritorial.” In other words, the Chamber argued that the ordinance had impermissibly reached beyond the geographical area over which the City of Minneapolis could exercise authority. The trial court denied the Chamber of Commerce’s motion for a temporary injunction on the pre-emption argument, but enjoined the City from enforcing the ordinance against employers based outside of Minneapolis, but who had employees working within the City. The Court of Appeals affirmed the trial court’s ruling on the first issue, but reversed on the second, holding that the ordinance could be applied to employers based outside of Minneapolis who had employees who worked in the city.
In its ruling this week, the Minnesota Supreme Court rejected the Chamber of Commerce’s argument that the ordinance conflicted with state law, specifically Minn. Stat. § 181.9413. Under that statute, if an employer provides sick leave to its employees, an employee may use that time to care for a sick or injured child or certain other family members, and may use that time for “safety leave” related to sexual assault, domestic abuse, harassment or stalking. The Court held that the City’s requirement to provide safe and sick leave to employees did not conflict with the permissive nature of the sick pay statute. Indeed, the Court noted that nothing in the state statute prohibited additional regulation by local governments, and that the ordinance was merely “additional and complementary to” the statute, rather than impermissibly conflicting with it. Accordingly, the Court upheld the lower court’s decision that the ordinance is valid and enforceable as it pertains to employers within the city of Minneapolis.
The Court then upheld the Court of Appeals’ decision that the ordinance could also validly be enforced against employers located outside of Minneapolis, but who have employees that work for 80 or more hours in a year within Minneapolis. In reaching its decision, the Court noted that the purpose of the ordinance was to protect the health and safety of Minneapolis’ residents, that the ordinance applies only to hours worked within the city of Minneapolis, and that cities have “‘wide discretion’ to use their police power to regulate matters of public health.”
In light of this decision, employers who have employees working within the Cities of Minneapolis, St. Paul or Duluth should ensure that they comply with each city’s safe and sick time ordinances. Employers who have carefully crafted paid time off policies, rather than a standalone vacation policy, can ensure compliance with these municipal ordinances.
If you have questions regarding the case, Minneapolis’ ESST ordinance or anything else related to sick and safe leave, please contact William Parker (952-921-4602 or firstname.lastname@example.org), or any other attorney at Peters, Revnew, Kappenman & Anderson, P.A.