Business groups sue San Antonio to end paid sick leave ordinance

The lawsuit is likely to delay the ordinance's Aug. 1 effective date.

San Antonio City Hall.

Nearly a year ago, San Antonio became the second city in Texas to pass an ordinance forcing employers to provide paid sick leave to employees.

On Monday, it became the second city in Texas to get sued for doing it.

A coalition of business groups, including the Associated Builders & Contractors of South Texas and the city’s restaurant and manufacturers associations, has filed a lawsuit against San Antonio, claiming the ordinance is an unconstitutional violation of the state’s minimum wage act. The ordinance was to take effect Aug. 1, but the litigation may delay that. The coalition has asked a court in Bexar County to block the law’s implementation.

Much like an earlier Austin case, the new lawsuit alleges that by requiring businesses to pay employees for hours they did not work, the paid sick leave ordinance violates the Texas Minimum Wage Act. That law, the business groups claim, “explicitly prevents localities from requiring private employers to pay more” than minimum wage.

Ricardo Cedillo, the lawyer representing the business groups, said many of his clients provide sick-leave benefits to their employees, but believe that the issue should be regulated at a state level.

“It makes no economic sense to have a restaurant or a business on one side of the street burdened with the additional costs of a city ordinance, and their competition across the street doesn’t have those same burdens,” Cedillo said. “The affected companies are going to have to adjust their pricing, pass on costs to consumers, and their competitors next door or across the street won’t have those pressures at all.”

An appeals court declared Austin’s ordinance unconstitutional in 2018, and it has yet to go into effect as the litigation continues. Austin has asked the Texas Supreme Court to hear the case.

San Antonio’s ordinance requires that businesses with more than 15 employees allow workers to accrue 64 hours of paid sick leave per year; at smaller businesses, that number is 48.

For the community groups that pushed forward the policy, the lawsuit portends more delays and more disappointments.

“We’re suffering without paid sick time,” said Joleen Garcia, a community organizer with the Texas Organizing Project. “We are working when we’re sick. We are taking pay cuts if we choose to stay home when we’re sick. A lot of us were looking forward to Aug. 1 as the day when we would start to gain dignity at our workplace.”

Deputy City Attorney Ed Guzman said the city is reviewing the lawsuit.

“In the meantime, we will continue to work with and discuss the ordinance with all stakeholders,” he said. City leaders had been hosting information sessions ahead of the ordinance’s effective date.

When the San Antonio City Council passed the ordinance last summer, several council members acknowledged the steep odds it would face, both in the courts and at the state Capitol.

“I believe this is dead on arrival in Austin,” Councilman Manny Pelaez said at the time.

But after attempts to override the ordinances failed this year at the state Legislature, the issue has been left to the courts.

Business-backed bills that would have prohibited such measures at the local level were expected to sail through Texas’ GOP-led Legislature. But a consensus bill filed in both chambers and blessed by the governor became “poisoned” after its author, Sen. Brandon Creighton, R-Conroe, stripped protections for LGBTQ individuals out of a revised version. Advocacy groups feared that without those protections, the bills regulating cities’ employment practices could threaten local nondiscrimination ordinances.

A House committee ultimately added those protections back into bills to override paid sick leave ordinances, but the measures never made it to the governor’s desk.

Dallas has also passed a paid sick leave ordinance set to take effect next month.