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Minnesota Chamber of Commerce sues Minneapolis over paid sick time mandate

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Supporters of the sick-leave ordinance celebrate.
Supporters of the citywide sick-leave ordinance celebrate after the Minneapolis City Council unanimously approves an ordinance requiring most city businesses to provide paid sick leave to workers, Friday, May 27, 2016.
Glen Stubbe | Star Tribune via AP file

Updated: 3:23 p.m. | Posted: 9:45 a.m.

The Minnesota Chamber of Commerce is suing the city of Minneapolis over its pending sick time mandate.

The chamber said in a statement Friday morning it has filed a lawsuit in Hennepin County District Court intending to challenge the ordinance. 

"The action challenges the Minneapolis paid sick time ordinance as unlawful on the grounds that it conflicts with existing state law," the chamber statement said.

The sick time ordinance was approved by the Minneapolis City Council in May. St. Paul passed a similar, although not identical, ordinance last month. Both provide an hour of paid sick time for every 30 hours worked, with a cap of 80 hours — although employers are free to exceed that benefit. 

Both ordinances are scheduled to go into effect in July of next year, although there are some exceptions for staffing size and delays for some employers.

Minneapolis City Attorney Susan Segal said in a statement it's confident it will be able to defend the suit. 

"The City's new landmark Safe and Sick Time Ordinance is a critical step toward protecting the health, safety and general welfare of Minneapolis residents, workers and visitors," the statement reads.

The business group's suit is being joined by a number of other plaintiffs, including Graco Inc., the Minnesota Recruiting and Staffing Association, Otogawa-Anschel General Contractors and Consultants LLC, the National Federation of Independent Business, and the TwinWest Chamber of Commerce.

The chamber said in addition to the conflict with state law, many employers already offer sick time benefits, the ordinance requires significant staff effort to implement, that the differences between Minneapolis and St. Paul exacerbate that burden, and that the ordinance impacts businesses that aren't even located in Minneapolis because their employees deliver goods or provide services in the city.

"What the city of Minneapolis has done by passing this ordinance is try to create a patchwork of city by city ordinances," chamber spokesman Cam Winton said. "In doing so, it has set up a situation where businesses across the state, across the country and literally around the world will incur significant administrative headache and administrative cost to figure out this ordinance and try to comply with it.

The ordinance could, however, prompt a statewide standard. That's what happened after cities started enacting smoking bans a dozen years ago.

Supporters of the mandate hope that will happen again, and that businesses will find the benefit isn't as expensive or as difficult to manage as employers fear. 

"I understand the concern but I think once we actually have that rolled out and beat back the continued opposition from groups like the Chamber, to actually be able to enforce this and see what happens, I think we'll see many business owners, even then some who had concerns before, see that this is something that helps employees, that has slightly positive effect on reducing turnover," said Danny Schwartzman, who owns the Common Roots Cafe and catering business in Minneapolis. "We have happier employees and that means happier customers."

The lawsuit could prove a test of a variety of local initiatives, and could impact the St. Paul ordinance as well, although the St. Paul Area Chamber of Commerce is not pursuing any legal action at this point. 

But state preemption has been a key legal point in the debates over whether to require Minneapolis police to carry personal liability insurance and efforts to enact a $15 minimum wage in Minneapolis. 

Both were struck from this fall's ballot after court battles this summer.

 Correction: A previous version of this story said the accrual rate of sick time was one hour per hour worked. The correct version is above.