CORRESPONDENCE - Item #22 - Laserfiche WebLink

Home Browse Search

McCRACKEN, STEMERMAN & HOLSBERRY, LLP Grocery Worker Hazard Pay Ordinances February 2, 2021 Page 2 of 5 Angeles, West Hollywood, Santa Clara, and San Mateo are considering them as well. Shortly after the City of Long Beach passed its ordinance, the California Grocers Association (“CGA”) filed a lawsuit in federal court, claiming that the ordinance is unconstitutional. The federal judge assigned to the case has already denied CGA’s request to enjoin the ordinance from going into effect. We are certain that the judge will dismiss the lawsuit at the earliest opportunity. CGA raises three legal theories in its lawsuit, all of which have been decisively rejected by the Supreme Court and by lower federal and state courts. Equal Protection First, CGA claims that by targeting large grocery stores, the Long Beach ordinance violates the constitutional Equal Protection Clause. But legislative classifications in economic regulation like Long Beach’s ordinance are subject to highly deferential rational-basis review under the Equal Protection Clause.Williamson v. Lee Optical of Oklahoma, Inc., 348 U.S. 483, 488–489 (1955); Hodel v. Indiana, 452 U.S. 314, 331–332 (1981); Levin v. Commerce Energy, Inc., 560 U.S. 413, 426 (2010). Rational basis review is met if a court determines that there is “any reasonably conceivable state of facts that could provide a rational basis for the classification.” FCC v. Beach Commc’ns, Inc., 508 U.S. 307, 313 (1993). The Long Beach ordinance’s application to large grocery stores easily passes rational basis scrutiny. It targets businesses that employ workers deemed essential by California who face particular risks of COVID-19 infection, but excludes smaller businesses that may be less able to afford the mandated pay. Classifications targeting particular businesses like those in the Long Beach ordinance are perfectly constitutional. See, e.g., International Franchise Ass’n, Inc. v. City of Seattle, 803 F.3d 389, 407 (9th Cir. 2015) (upholding higher municipal minimum-wage ordinance that applied to national franchises: “The district court properly cited the rational-basis standard. . . . It is legitimate and rational for the City to set a minimum wage based on economic factors, such as the ability of employers to pay those wages.”); RUI One Corp. v. City of Berkeley, 371 F.3d 1137, 1154 (9th Cir. 2004) (upholding over equal-protection challenge a municipal living-wage ordinance that applied only to a small number of businesses located in the Berkeley Marina); California Grocers Assn. v. City of Los Angeles, 52 Cal.4th 177, 211 (2011) (upholding municipal job retention requirement targeting large grocery stores in Los Angeles); Associated Builders and Contractors of California Cooperation Committee, Inc. v. Becerra, 231 F.Supp.3d 810, 827 (S.D. Cal. 2017) (applying rational basis review to prevailing wage law modification); Fortuna Enterprises, L.P. v. City of Los Angeles, 673 F. Supp. 2d 1000, 1013 (C.D. Cal. 2008) (upholding municipal minimum-wage law that applied only to hotels with more than 50 rooms located near Los Angeles International Airport). In its lawsuit, CGA has argued that the Long Beach ordinances violates its “fundamental right” to contract with its employees on whatever basis it wants, including the wages that it will pay them. It claims that the ordinance should therefore be reviewed under the “strict scrutiny” test, which applies to the denial of fundamental rights like the right to speak, the right to be free