San Antonio’s paid sick leave ordinance suffered its latest blow in court on Wednesday.

In a victory for business owners and business groups suing to strike the law down entirely, the Texas Fourth Court of Appeals ruled to keep the ordinance on hold while that lawsuit makes its way through the legal system.

Additionally, though not a ruling, the justices said the City’s ordinance was unconstitutional because it violated the Texas Minimum Wage Act, which prohibits cities from regulating wages of private employers.

San Antonio’s ordinance would require employers to provide one hour of paid sick leave for every 30 hours worked. The rule would affect some 354,000 workers in San Antonio, where, according to the U.S. Bureau of Labor Statistics, 11% work in food service.

The appeal case hinged on the definition of a wage.

“The pivotal question we have answered is whether the Amended Ordinance’s sick and safe leave requirement establishes a minimum wage: it does,” wrote Justice Patricia O. Alvarez. “Although the [state law] does not define wage, we have discerned the legislature’s intent by applying the word’s common meaning ….”

The City of San Antonio argued throughout the appeals case that the sick leave requirement was not a wage because it was not a “fixed regular amount” owed for work performed.

City Council adopted the paid sick leave ordinance in 2018, after a petition drive led by progressive and labor groups such as the Texas AFL-CIO and Texas Organizing Project (TOP) collected roughly 144,000 petition signatures.

A council-appointed commission revised the original ordinance in order to stave off possible legal challenges, leading to the Safe and Sick Leave Ordinance that was set to take effect in December 2019. But a group of businesses and business associations sued the City in July 2019.

The docket grew quickly as outside groups joined the fray. MOVE Texas and TOP joined on the side of the City to defend the ordinance, while the State of Texas marshaled against it.

Wednesday’s decision from the Fourth Court of Appeals comes after the Texas Supreme Court let a lower-court ruling stand that deemed unconstitutional a nearly identical ordinance in Austin, which passed just months before San Antonio’s. Another paid sick leave ordinance in Dallas also was put on hold by a federal court.

San Antonio City Attorney Andy Segovia said in a prepared statement the City was disappointed by the ruling.

“The Safe and Sick Leave Ordinance was adopted by the City of San Antonio to provide protections to some of the most vulnerable workers in our community, which has become even more critical during the ongoing pandemic,” he said. “We will be reviewing our legal options going forward and monitoring any state or federal legislation that would protect workers in San Antonio.”

Ryan Cox, an attorney at Texas Civil Rights Project who represented TOP and MOVE Texas, said their “fight for safe workplaces and working families will continue.”

“This common sense reform was supported by tens of thousands of petition signers in San Antonio and passed with nearly unanimous support of our City Council, and yet, a few business groups have been able to put roadblock after roadblock in the way of common sense protections for workers,” he said in a prepared statement.

Kelli Cubeta, whose law firm represented the firms and business associations challenging the ordinance, said the ruling would give confidence to businesses that any future attempt by the City to impose similar measures would be deemed unconstitutional. The Texas Retailers Association, San Antonio Manufacturers Association, the Association of Builders and Contractors, and San Antonio Restaurant Association were among the groups that sued to stop the ordinance.

Cubeta said the businesses that would be hit hardest are restaurants, as well as any lower-wage employers that have high turnover.

She said businesses were worried that a favorable ruling for the ordinance could have opened up the door for other expenses, such as obligations to pay workers for maternity leave.

“It was coming out of their bottom line,” she said.

Waylon Cunningham

Waylon Cunningham

Waylon Cunningham writes about business and technology. Contact him at waylon@sareport.org.