The Ninth Circuit Court of Appeals unanimously upheld a law boosting the minimum wage for some hotel workers in the City of Los Angeles.
A three-judge panel on the circuit said on Monday that a District Court had been correct last year, when dismissing the challenge to the initiative. The suit was brought by two industry groups: the American Hotel and Lodging Association, and the Asian American Hotel Owners Association.
Passed in October 2014, the measure raised the minimum wage in L.A. this year to $15.37 per hour, for workers at hotels with more than 150 rooms. In July 2015, the same rule took effect for staff at hotels with 300 or more rooms. The prevailing hourly minimum wage at those hotels beforehand was $12.28.
The ordinance contained an opt-out provision for hotels that enter into collective bargaining agreements with workers—the crux of the hoteliers’ legal complaint.
“Minimum labor standards, such as minimum wages, are not subject to Machinist preemption,” the court ruled, referring to the precedent that had been cited by the plaintiffs.
Ironically, Judge Harry Pregerson noted in the court’s opinion that the Machinist case refers to a 1976 decision, which ruled that states cannot prohibit unions from employing strike tactics as “weapon of self-help.”
Pregerson said the hotel associations made the assertion that the preemption should apply because L.A.’s ordinance “interferes with labor–management relations.”
“Minimum labor standards do technically interfere with labor–management relations and may impact labor or management unequally,” Pregerson wrote, “much in the same way that California’s at-will employment may favor employers over employees.”
He said the laws are not preempted, because they do not “regulate the mechanics of labor dispute resolution.”
One of the most powerful lobbying groups in the country had written a brief in support of the two hotel associations. The US Chamber of Commerce had filed an amicus curiae backing their challenge, according to Courthouse News.
