Ducey signs law banning local rules on workers' benefits

PHOENIX — Responding to pleas from restaurant owners, Gov. Doug Ducey signed legislation Wednesday designed to block cities and counties from telling private employers what fringe benefits they must offer.

The measure is specifically aimed at preventing local laws that tell companies they have to offer things such as paid vacation time and maternity leave. Chianne Hewer, lobbyist for the Arizona Restaurant and Hospitality Association, testified to lawmakers that they need to preclude local options.

But Rebekah Friend, executive director of the state AFL-CIO, said Wednesday that lawmakers, and now the governor, may have overstepped their bounds.

She says a 2006 voter-approved measure establishing a state minimum wage also covers fringe benefits and working conditions. Friend said that law specifically allows local communities to establish standards above and beyond the minimum.

The Arizona Constitution specifically forbids the Legislature from tinkering with anything that has been approved by voters. Friend said this measure runs afoul of it and likely will lead to a lawsuit.

Rep. J.D. Mesnard, R-Chandler, who sponsored the measure, said he believes it will survive a legal challenge.

“At the end of the day, as with anything, you can end up in court,” Mesnard said. “And then a judge is going to tell us the interpretation.”

The business community is powerless to block “living wage” legislation pending in Flagstaff and being considered in other communities because the 2006 initiative specifically allows cities to set wages beyond what the state requires, which currently is $8.05 an hour.

Back to homepage

Subscriber Login

Keep reading with a digital access subscription.

Subscribe now

Mesnard’s legislation is an end run of sorts. It limits the definition of “wages” to only the salaries being paid.

Everything else will now be defined in Arizona as “nonwage compensation,” ranging from sick pay, vacation pay, maternity leave and severance benefits to commissions and pension contributions.

Hewer told lawmakers that restaurants consider those “things they have to keep in their pocket to be competitive against that restaurant across the street.”

Mesnard said businesses, particularly those with multiple locations, should not have to deal with “a patchwork of laws.”

In Tucson, Councilwoman Regina Romero has pushed for an ordinance to require sick leave, saying she considers it part of a “working family agenda.” Romero said about half of Tucson workers do not have access to earned sick leave.

Romero said she may have to start smaller, perhaps adding a sick leave requirement to an existing Tucson ordinance that requires contractors who do business with the city to pay a “living wage.”

Tempe has considered the issue of paid sick leave but proponents backed off after stiff business opposition.

The law signed Wednesday by Ducey will short-circuit such moves.