Three Texas cities have adopted municipal ordinances requiring private employers to provide paid sick leave to employees.
The City of Austin enacted the first ordinance on February 15, 2018, the City of San Antonio followed on August 16, 2018, and the City of Dallas on April 24, 2019.
The Austin ordinance was the first to be adopted and the first to be challenged in court; therefore, it is the furthest along in the legal system, pending before the Texas Supreme Court. Several private business organizations filed a lawsuit in 2018. The Austin District Court denied their request for a temporary injunction and the plaintiffs appealed to the Third Court of Appeals. The Court of Appeals reversed the denial of the temporary injunction and remanded the case back to the trial court for further proceedings.
The Third Court of Appeals held that (1) the Texas Minimum Wage Act preempts local regulations that establish a wage; (2) the Austin Ordinance establishes a wage; (3) the Act preempts the Austin Ordinance as a matter of law as a result; and (4) the Austin Ordinance is therefore unconstitutional (see Texas Constitution Art. XI, § 5 no city ordinance “shall contain any provision inconsistent with the Constitution of the State, or of the general laws enacted by the Legislature of this State.”).
All of the parties to the original case, plus other interested groups (including TCA) filed briefs in support of review by the Texas Supreme Court in an effort to further clarify and solidify the law on this matter. On June 5, 2020, the Supreme Court issued an order denying the Petitions for Review. Therefore, the decision by the Third Court of Appeals stands and the Austin ordinance continues to be ineffective.
The City of San Antonio's ordinance was originally scheduled to go into effect on August 1, 2019; however, a coalition of business owners filed a lawsuit and the parties agreed to delay implementation until December 1, 2019. In the meantime, the city received additional input from the public and on October 3, 2019, released a revised and expanded ordinance re-named the "Safe and Sick Leave" ordinance with a December 1, 2019, effective date. Despite the city's action, the District Court issued an injunction on November 22, 2019. The City appealed to the Fourth Court of Appeals and on March 4, 2020, the Court upheld the lower court's injunction. Now that the Supreme Court has declined to hear the Austin ordinance case, the San Antonio case may proceed; however, there may be delays due to the COVID-19 health crisis.
The City of Dallas' paid sick leave ordinance was effective on August 1, 2019, and enforcement was set to begin on April 1, 2020. Businesses and the State of Texas sued in federal court and on March 30, 2020, the court issued an injunction halting enforcement of the law.