Wednesday, July 6, 2016

$15 minimum wage is unconstitutional, says Ohio Attorney General

The drive to push local minimum wags in Ohio municipalities to $15 an hour may have hit a significant snag—Ohio’s Constitution.

According to an advisory opinion [pdf] issued by Ohio Attorney General Mike DeWine, a municipal ordinance may not require an employer to by a to pay its employees an hourly minimum wage rate that is in excess of the statewide hourly minimum wage rate.

A little background. In 1912, Ohio’s voters first gave the state legislature the power to pass wage and hour laws, in Article II, § 34 of the Ohio Constitution, which provides: “Laws may be passed fixing and regulating the hours of labor, establishing a minimum wage, and providing for the comfort, health, safety and general welfare of all employees; and no other provision of the constitution shall impair or limit this power.”

Then, in 2006, Ohio’s voters passed a statewide ballot initiative, which made Ohio’s wage and hour law part of the state’s constitution. As a result, Article II, § 34a of the Ohio Constitution provides: “Except as provided in this section, every employer shall pay their employees a wage rate of not less than six dollars and eighty-five cents per hour beginning January 1, 2007.”

According to the Attorney General, reading secs. 34 and 34a together, a city lacks the power to increase the minimum wage beyond that which is established by the state.
Even were a court to examine Ohio Const. art. II, § 34a and R.C. Chapter 4111 for an indication from the General Assembly of an intent to exclusively occupy the field of the minimum wage rate before applying “conflict by implication,” there is sufficient evidence in Ohio Const. art. II, § 34a and R.C. Chapter 4111, coupled with the practical and economic difficulties created by varying minimum wage rates, to conclude that the General Assembly has exclusive control of the minimum wage rate throughout the state of Ohio. … 
The General Assembly’s explanation of the purpose of Ohio Const. art. II, § 34a indicates that the statewide hourly minimum wage rate is to be uniform throughout the state. The importance of that uniformity is demonstrated when considering the potential negative fiscal and economic consequences to the state, municipalities, employers, and employees when varying minimum wage rates exist in the state. 
Here’s the irony. The same labor unions that are now pushing for the local $15 minimum wage are the same labor unions that pushed in 2006 for the statewide constitutional minimum wage, which now likely renders a local higher minimum wage unconstitutional.

I have spoken to many local business owners who have told me that they will leave the City of Cleveland if the $15 minimum wage becomes a reality. Cleveland is in the middle of a huge revitalization (thank you, New York Times and Chicago Tribune, for example), which we cannot afford to risk. Thus, I view this advisory opinion as goods news. Stay tuned, however. This issue is far from over, and, likely will not be until the Ohio Supreme Court has its say years from now.