Austin urges an appeals court to allow its paid sick leave ordinance to take effect

Saying that the city of Austin's paid sick leave ordinance would "undermine state sovereignty and upend constitutional structure," an attorney for the state of Texas joined lawyers for a conservative think tank on Wednesday in urging a state appeals court to uphold a temporary order blocking the ordinance from going into effect.

Passed by the city council in February, the ordinance requires most employers to offer eight days of earned sick leave for a year of work; six days for businesses with fewer than 15 employees. But it was blocked by the Austin-based 3rd Court of Appeals in August after business groups led by the Texas Public Policy Foundation sued the city.

Andrew Davis, an attorney with the Texas Attorney General's Office, said in court that the paid sick leave ordinance effectively raises wages — and it's the state's job to set a minimum wage. The Texas Public Policy Foundation's lead attorney, Rob Henneke, cited a “wide spectrum of businesses” that were asking for relief, and argued that a city mandate that exempts unionized businesses is unconstitutional.

Paul Matula, an attorney for Austin, sought to have the temporary block lifted, saying it was filed "before the facts had played out" in the case. The argument for the injunction wasn’t convincing, Matula said. But he did acknowledge that Austin businesses “would have to do some things” to prepare to comply with the ordinance.

The fight surrounding the ordinance has become somewhat routine in Texas — Austin’s liberal-leaning city council passes a local regulation, but conservative state lawmakers argue that it is an overreach. The fight then goes to the courts or the Legislature. In this case, it was the Texas Public Policy Foundation that sued, and then Texas Attorney General Ken Paxton lent his support, calling the paid sick leave ordinance “unlawful.”

The sick leave ordinance was scheduled to go into effect on Oct. 1, and if the appeals court lifts the block, it’s possible that the ordinance could go into effect immediately. Either way, the case is likely to drag on. The three-judge panel was focused solely on the temporary injunction on Wednesday, and a full trial on the merits of the case would still be down the road. Meanwhile, there are 29 lawmakers who’ve already pledged to pursue legislation banning the sick-leave ordinances when the Legislature convenes in January.

When the ordinance passed, it looked like Austin would be the first city in the South to guarantee paid sick leave. San Antonio followed suit, passing a nearly identical ordinance in August. And in Dallas, a petition to put paid sick leave on the ballot garnered 52,885 valid signatures, falling short of the 10 percent requirement by less than a thousand.

“Thousands of people in three Texas cities have spoken and made clear that they want to be able to take a day off when they get sick,” said Jose Garza, executive director of the Workers Defense Action Fund, which has pushed for the ordinances. “As has become customary, our statewide leadership is working to undermine working people across the state of Texas.”

Adam Orman, co-owner of local restaurant L’Oca d’Oro, said his business plans to comply with the ordinance whether or not it’s implemented.

“As a small business — we’re around 25 employees — there are a lot of things we’d like to do but can’t afford to do yet,” he said. “This is easily one of the least expensive benefits we can provide.”

In contrast, the Texas Public Policy Foundation has argued that “paid sick leave comes at a high cost for to employers and to workers themselves,” in addition to violating state law. That’s because of the estimated costs associated with complying with the ordinance, said Sarah Silberstein, the think tank's press secretary. Silberstein cited the Austin Chamber of Commerce’s estimate that the ordinance could cost businesses $140 million annually in overhead. And that could trickle down to workers, leading to fewer jobs and less paid vacation time, Silberstein said.

Disclosure: The Texas Public Policy Foundation has been a financial supporter of The Texas Tribune, a nonprofit, nonpartisan news organization that is funded in part by donations from members, foundations and corporate sponsors. Financial supporters play no role in the Tribune's journalism. Find a complete list of them here.