Limits on Local Wage Laws Heat Up in State Legislatures


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Since Jan. 1, 10 state legislatures have introduced bills that would prevent counties and cities from requiring employers to provide a minimum wage or benefit to workers.

Of the 10, seven states have legislation that is still pending. Preemption laws were signed into effect in Kentucky, vetoed in Virginia and died in committee in Maryland.

Bills limiting county and city authority over labor regulations still are under consideration by legislatures in Arkansas, Iowa, Minnesota, Missouri, New Mexico, Pennsylvania and West Virginia. In Iowa, Minnesota, Missouri and Pennsylvania, if approved, bills would void established city and county minimum wage or benefit laws.

A recent court case in Missouri provides an example of the confusion competing state and local labor laws may create for employers.

In February, the Missouri Supreme Court overturned a lower court's decision that the St. Louis minimum wage halted in 2015 could take effect. The court's decision would have allowed the city's hourly minimum wage, which under the original ordinance was scheduled to reach $10 on Jan.1, to take effect immediately, leaving the city and employers to figure out how to navigate enforcement and compliance.

However, before the court's decision could become final, opponents of the wage filed a request March 15 for the court to rehear the case, again stopping the city's minimum wage from taking effect.

Compounding uncertainty for employers, following the court's decision the Missouri legislature introduced a bill (H.B. 1194) that would retroactively void the St. Louis minimum wage, despite the court's decision. The bill was approved by the House and is in the Senate.

When state laws clash with existing city and county laws, courts may get involved, leaving employers uncertain of the outcome. Employers in Iowa, Minnesota and Pennsylvania also should be aware of pending legislation that may lead to similar legal conflicts.

For more information, check out the Payroll Administration Guide Newsletter, available to subscribers.

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