Tex. Ass'n of Bus. v. City of Austin
Decision Date | 16 November 2018 |
Docket Number | NO. 03-18-00445-CV,03-18-00445-CV |
Citation | 565 S.W.3d 425 |
Parties | TEXAS ASSOCIATION OF BUSINESS; National Federation of Independent Business, American Staffing Association; LeadingEdge Personnel, Ltd. ; Staff Force, Inc.; HT Staffing Ltd. d/b/a The HT Group; The Burnett Companies Consolidated, Inc., d/b/a Burnett Specialists; Society for Human Resource Management; Texas State Council of The Society for Human Resource Management; Austin Human Resource Management Association ; Strickland School, LLC ; and The State of Texas, Appellants, City of Austin, Texas; and Spencer Cronk, City Manager of The City of Austin, Cross-Appellants. v. CITY OF AUSTIN, TEXAS; Steve Adler, Mayor of The City of Austin; and Spencer Cronk, City Manager of The City of Austin, Appellees, Texas Association of Business; National Federation of Independent Business, American Staffing Association; Leading Edge Personnel, Ltd.; Staff Force, Inc.; HT Staffing Ltd. d/b/a The HT Group; The Burnett Companies Consolidated, Inc., d/b/a Burnett Specialists; Society for Human Resource Management; Texas State Council of The Society for Human Resource Management; Austin Human Resource Management Association ; Strickland School, LLC ; and The State of Texas, Cross-Appellees. |
Court | Texas Court of Appeals |
Mr. Paul Matula, Mr. Peter M. Kelly, Ms. Dana Levy, for Appellees City of Austin, Texas, Spencer Cronk, City Manager of The City of Austin, Steve Adler, Mayor of The City of Austin.
Mr. Ryan Walters, Mr. Robert E. Henneke, Kerrville, Mr. Munera Al-Fuhaid, for Appellants National Federation of Independent Business, The Burnett Companies Consolidated, Inc., d/b/a Burnett Specialists, Staff Force, Inc., Texas Association of Business, Austin Human Resource Management Association, American Staffing Association, LeadingEdge Personnel, Ltd., Society for Human Resource Management, Texas State Council of The Society for Human Resource Management, Strickland School, LLC, HT Staffing Ltd. d/b/a The HT Group.
Mr. David J. Hacker, Mr. Andrew B. Davis, for Appellants The State of Texas.
Before Chief Justice Rose, Justices Puryear and Field
This is an interlocutory appeal from district court orders in a suit challenging the City of Austin’s paid-sick-leave ordinance. The Texas Association of Business, et al. (collectively, the "Private Parties"), and later the State of Texas as intervenor, sued the City of Austin and its city manager, Spencer Cronk (collectively, the "City"), asserting that the paid-sick-leave ordinance is unconstitutional and seeking temporary and permanent injunctive relief. The City challenged the district court’s jurisdiction, arguing that the claims against it are neither ripe nor viable and that the State lacks standing to intervene. The district court denied both the application for a temporary injunction and the City’s jurisdictional challenges. Based on our determination that the district court has jurisdiction over the claims asserted against the City and our holding that the City’s paid-sick-leave ordinance violates the Texas Constitution because it is preempted by The Texas Minimum Wage Act, we will reverse and remand for issuance of the requested temporary injunction and for further proceedings consistent with this opinion.
In February 2018, the City of Austin enacted an ordinance that would, stated generally, require private employers to provide paid sick leave to their employees. See Austin, Tex. Ordinance No. 20180215-049 (Ordinance). Under the Ordinance, Austin employers must "grant an employee one hour of earned sick time for every 30 hours worked." Id. § 4-19-2(A). The sick leave accrues as soon as the employee begins working and must be made available for use either immediately or after 60 days of employment, depending on certain circumstances of employment. See id. § 4-19-2(B–D). An employer must pay the "earned sick leave in an amount equal to what the employee would have earned if the employee had worked." Id. § 4-19-2(J). The Ordinance caps the sick leave an employee may accrue at either 48 or 64 hours per year, depending on the employer’s size. See id. § 4-19-2(F–G). The Ordinance purports to give the City the authority to subpoena employers' records for compliance purposes, see id. § 4-19-7(a), and employers that violate the Ordinance face civil and criminal penalties, see id. §§ 4-19-6(C)(1) ( ), 4-19-7(B) (Class C misdemeanor). The Ordinance was scheduled to take effect on October 1, 2018, but this Court granted a temporary stay pending resolution of this appeal. See Texas Ass'n of Bus. v. City of Austin , No. 03-18-445-CV, 2018 WL 3967045, at *1 (Tex. App.—Austin Aug. 17, 2018, no pet.) (mem. op.).
The Private Parties—five companies with Austin employees and six business associations—filed a declaratory-judgment action against the City asserting that the Ordinance was facially unconstitutional—i.e., that the Ordinance, by its terms, always operates unconstitutionally—because it is preempted by the Texas Minimum Wage Act (sometimes TMWA), and because it violates the Texas Constitution’s due-course-of-law, equal-protection, association, and warrantless-search clauses. See Tex. Const. arts. XI, § 5 ( ); § 3 ( ), 9 (prohibiting "unreasonable searches or seizures"), § 19 ( ), § 27 ( ); Tex. Labor Code §§ 62.001 –.205 (the TMWA); see also Tenet Hosps. Ltd. v. Rivera , 445 S.W.3d 698, 702 (Tex. 2014) () (citing United States v. Salerno , 481 U.S. 739, 745, 107 S.Ct. 2095, 95 L.Ed.2d 697 (1987) ). As relief, the Private Parties sought temporary and permanent injunctions prohibiting the City from enforcing the Ordinance.
The State intervened in the Private Parties' suit, asserting only a preemption claim. As relief, the State asked for a declaration that the Ordinance is preempted by the TMWA and a permanent injunction against the Ordinance’s enforcement. The State also joined the Private Parties' application for a temporary injunction.
The City responded by filing, among other pleadings, a plea to the jurisdiction as to the Private Parties and a motion to strike the State’s intervention. In support of its plea to the jurisdiction, the City asserted that the Private Parties lacked standing and that their claims were not ripe for adjudication because they had not yet suffered any injury from an Ordinance that was not yet in effect. The City also argued that governmental immunity barred the Private Parties' claims because the claims were not viable as a matter of law. Specifically, the City argued that the preemption claim is invalid because the Ordinance is consistent with minimum-wage laws. Similarly, in its motion to strike the State’s intervention, the City argued that the State lacked standing and that its claims were not yet ripe for adjudication because the State had not suffered an injury. The City also argued that the State’s preemption claim was not viable as a matter of law because the Ordinance did not conflict with the TMWA and, thus, was barred by governmental immunity.
After a hearing on the competing motions, the district court denied the application for temporary injunction. It is from this interlocutory order that the Private Parties and the State now appeal. The district court also denied the City’s plea to the jurisdiction and motion to strike, and the City cross-appeals from these interlocutory orders.
We begin, as we must, with the City’s cross-appeal because it challenges the district court’s subject-matter jurisdiction. See Crites v. Collins , 284 S.W.3d 839, 840 (Tex. 2009) ( ). In its first cross-issue, the City argues that it was error for the district court to deny its plea to the jurisdiction because the Private Parties' claims are not ripe for adjudication and because the Private Parties pleaded facially invalid claims that are, as a result, barred by governmental immunity. In its second cross-issue, the City challenges the district court’s failure to grant its motion to strike the State’s intervention, arguing that the State’s preemption claim, like the Private Parties' preemption claim, is not viable and that, even if it were, the State lacks standing to join in the Private Parties' claim.
Standard of review
Whether a trial court has subject-matter jurisdiction is a matter of law that we review de novo. See Texas Dep't of Parks & Wildlife v. Miranda , 133 S.W.3d 217, 226–28 (Tex. 2004) ; Texas Nat. Res. Conservation Comm'n v. IT–Davy , 74 S.W.3d 849, 855 (Tex. 2002). In performing this review, an appellate court does not look to the merits of the case, but considers only the pleadings and evidence relevant to the jurisdictional inquiry.
See Miranda , 133 S.W.3d at 227 ; County of Cameron v. Brown , 80 S.W.3d 549, 555 (Tex. 2002). When a plea to the jurisdiction challenges the pleadings, as it does here, the trial court must construe the pleadings liberally in favor of the pleader. Miranda , 133 S.W.3d at 226. If the pleadings do not allege facts sufficient to affirmatively demonstrate jurisdiction, but the pleading defects are curable by amendment, the issue is one of pleading sufficiency and the pleader should be afforded an opportunity to amend. Id. at 226–27.
Ripeness of Private Parties' claims
The Private Parties have raised facial challenges to the Ordinance’s constitutionality, arguing specifically that the Ordinance...
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