Paid Sick Leave Becomes Law

Could 157,117 voters be wrong?

On Election Day, 69% of Milwaukee voters supported mandating paid sick leave for workers at private companies in the city. But the Metropolitan Milwaukee Association of Commerce (MMAC) is trying to reverse that decision.

The business organization has filed a notice of claim with the city, putting City Hall on notice that it may sue to strike down the ordinance.

According to a memo drafted by attorneys at Michael Best & Friedrich LLP, MMAC does not believe that the city has the power to require employers to provide up to nine paid sick days per year. It also believes that MMAC’s members would “suffer financial injury” if they are forced to comply with the ordinance.

Milwaukee joins Washington, D.C., and San Francisco in requiring paid sick days and, at least in San Francisco, no “financial injury” has been reported.

In fact, the Golden Gate Restaurant Association, which represents restaurants in San Francisco, now supports that city’s sick leave ordinance after initially opposing it. “The mandate is affordable, considering the public benefit,” Kevin Westlye, the group’s executive director, told the Los Angeles Times.

Respecting Voters

The ordinance requires private companies that employ more than 10 workers to provide nine paid sick days per year, while companies that employ fewer than 10 workers must provide five days off per year. Workers must accrue the paid time off during the year.

Roughly half of Milwaukee’s private-sector workers—about 122,230 people— did not have paid sick days until this ordinance was passed. About seven out of eight food service employees were not covered by paid sick leave policies.

According to the U.S. Department of Labor, about 80% of management-level workers nationwide have paid sick leave, while only 39% of service workers have this benefit.

9to5, National Association of Working Women organized the petition drive to place the question on the ballot. Sangita Nayak, an organizer with 9to5, said that the city should honor the will of the vast majority of Milwaukee’s voters, even though Milwaukee Mayor Tom Barrett opposed the ordinance. “This is a policy decision that was passed by Milwaukeeans and should be respected,” Nayak said. “We hope the mayor’s office is doing what they need to do to move this forward quickly.”

Resolving Legal Issues

Julie Granger, vice president of communications for MMAC, said that the MMAC board would likely decide whether it would formally challenge the ordinance at its Nov. 17 meeting. “They are really digging into what the legal issues are and whether there would be grounds for fighting this ordinance,” Granger said. “It is not certain.”

Sherry Leiwant, of A Better Balance: The Work and Family Legal Center, helped to draft the ordinance based on language in a similar ordinance that was adopted in San Francisco in late 2006. She said that version has not been challenged in court.

Leiwant said that Milwaukee has the authority to mandate paid sick leave for employees in the private sector because federal and state laws do not cover paid sick leave. “There’s no conflict,” Leiwant said.

She said that the Milwaukee city attorney’s office reviewed the ordinance prior to it being on the Nov. 4 ballot as direct legislation—meaning that voters could ratify it directly, without a veto from the mayor or a vote by the Milwaukee Common Council.

She said that a few technical changes were requested by the city during that review process. “I think there were some ways that things had to be phrased to make it consistent with the statutes and other ordinances, just to conform with other laws on the books,” Leiwant said. “But nothing substantive was requested.”

Assistant City Attorney Tom Miller said that his office reviewed the ordinance to determine whether it fell into the scope o what was appropriate for a piece of direct legislation. He said the city attorney’s office did not work with 9to5 to help craft the language of the ordinance itself. The office routinely offers its opinion on proposed legislation developed by members of the Milwaukee Common Council. “I don’t believe that our office was asked to have any role in that,” Miller said.

Miller said the ordinance will be implemented by the city’s Department of Employee Relations, which will work out the details of compliance. Companies that employ workers in Milwaukee will be required to comply after a 90-day rulemaking period.

A Financial Hardship?

Although the MMAC memo states that the ordinance would create financial hardship for its members, Granger said the bigger issue is one of flexibility for employers. “I think this really flies in the face of being able to tailor benefits to the employee base that you have,” Granger said.

She said that the majority of MMAC’s members provide paid sick leave to their employees, but that she didn’t have an exact number of the members that do so. If their policies meet or exceed what is now required by the ordinance, they will not have to make any changes.

Although MMAC is predicting that the new ordinance would have a negative impact on Milwaukee’s economic future, Granger said that MMAC has not determined the total cost to employers of either providing paid sick days or of administering the new requirements. “I think it’s going to be a different cost for every business,” Granger said.

However, a study by the nonpartisan Washington, D.C.-based Institute for Women’s Policy Research (IWPR) found that Milwaukee businesses would save $15 million per year because of the new requirements, because paid sick days would lead to less turnover and higher productivity.

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