New Lawsuits Target Pandemic Pay Mandates

Pandemic pay mandates could be getting more expensive for some of the cities passing those measures.

The California Grocers Association (CGA) said it has filed federal lawsuits against the cities of San Leandro and West Hollywood to challenge recently approved pay mandates for some grocery store workers.

The local laws call for an additional $5 per hour in extra pay for a select group of grocery store employees.

“In addition to clearly violating federal and state law, the extra pay mandates will harm customers and workers,” said Ron Fong, president and CEO of CGA. “A $5/hour mandate amounts to a 28% average increase in labor costs for grocery stores. That is too big a cost increase for any grocery retailer to absorb without consequence. Options are few. Either pass the costs to customers, cut employee or store hours or close. Already two stores closed in Long Beach after the city enacted a $4/hour pay increase. Nearly 200 workers lost those jobs.”

Earlier in February, the CGA filed similar suits against Oakland and Montebello. The Northwest Grocery Association and the Washington Food Industry Association have filed a lawsuit against the City of Seattle challenging an ordinance approved by the Seattle City Council that took effect Feb. 3. The ordinance mandates extra pay of $4 per hour for many grocery store employees.

According to CGA, a recent study found that extra pay mandates of $5.00/hour could raise consumer grocery prices by about $400 annually for the typical family of four. Alternatively, if grocers were forced to find offsetting savings in operational costs, it would mean a 22% across-the-board reduction in work hours, hurting the very workers these proposals aim to help.

As CGA argues, the pay mandates passed by all the cities have been illegal in two main ways:

• By singling out certain grocers and ignoring other groups that employ essential front-line workers, the mandates violate the U.S. Constitution and the California Constitution’s Equal Protection Clauses, which require similarly situated people to be treated alike.
• The mandates are preempted by the federal National Labor Relations Act, which protects the integrity of the collective-bargaining process. The causes of action against Oakland and Montebello are the same.

The first hearing is a preliminary injunction hearing in the Long Beach case on Feb. 23.

The suit against San Leandro was filed in the Northern District of California and the suit against West Hollywood was filed in in Los Angeles federal court. Both ask the courts to declare the ordinances invalid and unconstitutional.

“Grocery store workers are frontline heroes, and that’s why grocers have already undertaken a massive effort to institute measures to make both workers and customers safer in stores,” continued Fong. “Firefighters, police officers, health care workers, as well as transportation, sanitation and restaurant workers are essential, yet grocers are the only businesses being targeted for extra pay mandates. These ordinances will not make workers any safer.”