Subject: Living Wage Ordinance in Santa Fe
Well, it looks like there will be a legal challenge to the Santa Fe ordinance. Some of the reasons are listed in the article below, text copied from Lexis Nexis.
Copyright 2003 Albuquerque Journal
March 9, 2003 Sunday
SECTION: JOURNAL NORTH; Pg. 1
LENGTH: 1252 words
HEADLINE: Living Wage Law Leading to Lawsuit
BYLINE: John T. Huddy Journal Staff Writer
City Offered Free Representation
And so it begins.
On Monday, Santa Fe business owners, the Chamber of Commerce and the pro-business New Mexicans for Free Enterprise will join together to sue the city of Santa Fe in a battle over a living wage law passed Feb. 27.
Their 27-page complaint, obtained by the Journal last week, will present a laundry list of legal arguments against City Councilor Matthew Ortiz's bill, contending it infringes on various state, federal and local laws and assorted constitutional provisions.
Several local businesses and owners have signed on to the complaint, including Pink Adobe Restaurant owner Joe Hoback, the Pinon Grill at the Hilton of Santa Fe, the Pranzo restaurant, Peppers Food and Beverage Co. and Coyote Cafe proprietor Mark C. Miller.
The Santa Fe Lodger's Association, representing hotels and motels, has said it will also join the suit.
The complaint asks the court for a preliminary injunction to stop Santa Fe's minimum wage measure from becoming law at its January 2004 implementation date, a permanent injunction barring the law from ever becoming effective and a judicial declaration that the city's wage law is "unconstitutional and impermissible."
The complaint prepared for filing maintains that the living wage law, which calls for phasing in a $10.50 city minimum wage by 2008, should be struck down because:
* It violates a state constitutional ban on cities enacting laws "governing civil relationships, except as incident to the exercise of an independent municipal power." This provision means the city can't govern "the employer-employee relationship," the suit says.
* "The Minimum Wage Ordinance is nothing more than a licensing requirement as it mandates that any person seeking to operate a business in Santa Fe pay an excessive and unreasonable minimum wage in order to receive a business license." The wage requirement "bears no reasonable relation" to the regulation of business, the suit says.
* The ordinance violates state equal protection guarantees "by creating arbitrary and capricious classes" among businesses. The suit notes that the city minimum wage would not apply to businesses with fewer than 25 employees, those with collective bargaining agreements, nonprofits with city contracts or state or federal government agencies.
* The ordinance requires "persons of reasonable intelligence to guess at its meaning" when it comes to converting the value of health benefits and child care into an employee's hourly wage rate for purposes of reaching the required minimum wages.
* By forcing employers to pay "arbitrary and exorbitant" wages, the city "has taken the private property of Santa Fe businesses for public use."
* The state's own minimum wage law pre-empts the city's ordinance. The city ordinance also conflicts with the state minimum wage law by not exempting certain classes of workers, such as seasonal employees, from the minimum wage.
* Because the ordinance calls for including the value of employee health care and child care benefits toward meeting the minimum wage, employees will receive "different wages based on their medical condition" in violation of the New Mexico Human Rights Act.
* The ordinance violates the New Mexico Antitrust Act "by fixing labor costs for businesses" in Santa Fe instead of "allowing competitive market forces to dictate their business practices."
* Parts of the ordinance applying to tipped employees are unconstitutionally vague.
* The ordinance is arbitrary and capricious because, although its stated purpose is to help low-income employees, the ordinance "will actually result in higher unemployment, higher prices, decreases in benefits offered to employees, an increase in the demand for highly skilled and highly educated workers, and a migration of businesses from Santa Fe."
Ortiz's measure, approved by the council in a 7-1 vote, calls for the implementation of an initial city minimum wage of $8.50 an hour starting in January.
Santa Fe City Attorney Bruce Thompson, in a legal analysis for the City Council a few days before the council's vote, gave the living wage ordinance a 50-50 chance of withstanding a court challenge. But his opinion came before a number of amendments were added to the law before passage.
Supporters of Santa Fe's law contend that because Santa Fe is a "home rule" municipality, it can exercise its own independent powers to impose a city minimum wage.
Paul Sonn of New York University's Brennan Center for Justice said the center, which has defended the legality of living wage laws across the country, will help represent the city pro bono in a lawsuit.
In a press release issued this week, Sonn defends Santa Fe's measure, saying it conforms to both the state and federal constitutions.
"We don't believe there's any substance to this legal challenge," the press release from Sonn reads. "Cities enjoy considerable authority under New Mexico law to regulate businesses in their communities to safeguard the public welfare."
Santa Fe has had a range of "similar business regulations on the books for years," his release says.
City Councilor David Pfeffer, the lone dissenter when the council passed the living wage measure about 2 a.m. Feb. 27, remains steadfastly opposed to it.
"The enforcement provisions are frightening," Pfeffer said this week.
He used the section under "Prohibitions against Retaliation and Circumvention" as an example.
That section makes it unlawful for any employer to "take any action against an individual in retaliation for the exercise of or communication of information regarding rights under this ordinance."
"So does that mean if I'm an employer and have to lay off some people because I can't afford to retain them under this law, that I can be sued for retaliation?" Pfeffer questioned. "I don't see how that can be enforced. I think that would be bedlam for the community and local employers.
"Having the city manager as the judge, jury and executioner of this ordinance, to me, is opening up an enormous can of worms," Pfeffer said.
Living wage supporters say City Manager Jim Romero will probably not ask to see every business's financial statements to make sure it is complying with the law.
"We are not going to go out and demand people's records," said City Councilor Karen Heldmeyer, a living wage supporter, adding that the council's intent was to enforce the measure on a complaint-based system.
Heldmeyer defended the ordinance's legality.
"Who knows what the courts will do? But I don't think it's federal constitutionality will be found to be illegal," she said.
City Councilor Patti Bushee, who voted in support of the measure after several amendments were added, said that although certain sections could be challenged, overall the measure seems to be legal.
"My sense from what I have read thus far indicates we have the ability to enact a living wage ordinance," she said. "If anything, we've established the basic premise of having the city go into the private sector with a living wage."
More than 90 cities and counties have passed minimum wage laws, but they apply only to city employees and businesses with city contracts.
The cities of Santa Monica and New Orleans tried to pass private-sector minimum wage laws, but failed. Santa Monica's was defeated in a referendum vote, and New Orleans' was overturned by the Louisiana Supreme Court.
LOAD-DATE: March 11, 2003