Minnesota Supreme Court Upholds Minneapolis Minimum Wage Ordinance

Yesterday, the Minnesota Supreme Court released a unanimous decision upholding the Minneapolis Minimum Wage Ordinance, which raises the wages of all workers in the City of Minneapolis to $15 an hour by as early as 2022.

As we reported back in 2017 (Minneapolis Passes Phased-In $15.00 Minimum Wage), the City of Minneapolis passed a minimum-wage ordinance requiring employers to pay Minneapolis workers $15.00 per hour. The ordinance allowed for the requirement to be phased in through 2022 (for large employers) or 2024 (for smaller employers). The ordinance applies to all time worked by any employee working two or more hours per week within the geographic boundaries of Minneapolis, even if the employer is not physically located in Minneapolis.

What the Court Said

The Court noted that cities have broad powers to regulate their affairs so long as their actions do not conflict with the Federal or State constitution, or with state statutes. In finding that the City’s ordinance was not preempted by state law, the court relied heavily on the text of the Minnesota Fair Labor Standard Act (“MFLSA”), which requires employers to pay “at least” the wages set forth in the statute. By using the phrase “at least,” the court reasoned that the Minnesota Legislature “clearly contemplate[d] the possibility of higher hourly rates.” Thus, the court concluded, cities like Minneapolis are not precluded from setting a higher rate than what is set forth in the state statute.

Importantly, the court’s decision does not settle whether the similar issue of whether Minneapolis’ sick leave ordinance is a valid exercise of municipal authority or whether it is preempted by state law. That appeal is still pending, although both cases were argued on the same date (October 1).

Bottom Line

With a Minnesota Supreme Court decision allowing cities to implement their own minimum wage regulations, we might see this trend spread to other municipalities throughout the state. Stay tuned.