The City of Dallas Earned Paid Sick Time ordinance goes into effect on August 1, 2019. Or does it?
First things first. If the ordinance goes into effect, private employers with more than five employees must provide paid sick leave to every employee working at least 80 hours within the Dallas city limits at the rate of one hour of leave for every 30 hours worked. For employers with more than 15 employees, the employees can earn up to 64 hours annually. For employers with more than five employees but fewer than 16 employees, the employees can earn up to 48 hours. Any unused paid sick time can rollover from year to year. There are record-keeping and notice requirements, and employers must post a notice describing the requirements of the ordinance in a conspicuous place. There is no private right of action under the ordinance, but there is a civil fine of $500 for each violation. The ordinance requires the city to give ten days notice before levying a fine so that the employer can voluntarily comply with the ordinance. The city has said that it will seek no fines for noncompliance until after April 1, 2020, except for penalties for retaliation. And finally, for employers with less than five employees the ordinance does not go into effect until August 1, 2021.
San Antonio has a similar ordinance that also was scheduled to go into effect on August 1, 2019. San Antonio’s ordinance is the subject of a lawsuit brought by businesses seeking to declare the San Antonio ordinance unconstitutional. On Friday, July 19, 2019 Texas Attorney General Ken Paxton intervened in the San Antonio lawsuit and joined the twelve businesses in their effort to overturn the San Antonio ordinance. San Antonio responded by delaying implementation of its paid sick leave ordinance to December 1, 2019.
Austin also has a paid sick leave ordinance but its fate is uncertain. The Third Court of Appeals ruled in November 2018 that the Austin paid sick leave ordinance was unconstitutional because Texas’ minimum wage law preempts local city ordinances that are inconsistent with the minimum wage law. The inconsistency arises because mandatory paid sick leave requires Austin employers to pay their employees more than required under the state’s minimum wage law. The Third Court of Appeals prevented the Austin ordinance from going into effect by ordering the trial court to enter an injunction pending a final ruling.
Most observers thought that the Texas legislature would pass a law that would prevent cities like Dallas, Austin and San Antonio requiring private employers to give their workers certain benefits like paid sick leave. The bills targeted at cities passing local employment ordinances died in the Texas House.
The Austin paid sick leave ordinance is now making its way to the Texas Supreme Court.
Which brings us back to the Dallas ordinance and August 1, 2019. It seems clear that at the state level there is dissatisfaction with Austin, Dallas and San Antonio passing their own city ordinances on paid sick leave. In the face of litigation San Antonio backed down and delayed implementation of its paid sick leave ordinance until December 1, 2019. If the Texas Supreme Court declares the Austin paid sick leave ordinance unconstitutional, the constitutionality of the both Dallas’ and San Antonio’s paid sick leave ordinances will be in doubt.
Dallas employers need to be ready to implement the Dallas Earned Paid Sick Time ordinance on August 1, but also recognize that the fines will not start until April 1, 2020 and that there are serious challenges afoot to the constitutionality of the Dallas ordinance.