Senate Bill Would Reduce Ohio Minimum-Wage Coverage, Violating the Ohio Constitution

FROM POLICY MATTERS OHIO and THE NATIONAL EMPLOYMENT LAW PROJECT

Monday, June 6, 2011

Contact: Zach Schiller, Policy Matters Ohio (216) 361-9801 or

Tsedeye Gebreselassie, National Employment Law Project (917) 297-7622

Senate Bill Would Reduce Ohio Minimum-Wage Coverage,

Violating the Ohio Constitution

Thousands of Ohio workers who currently must be paid the state’s minimum wage would no longer be protected under a budget bill working its way through the state Senate (House Bill 153).  The bill would expand the categories of workers exempted from the state minimum wage – in violation of the minimum wage Constitutional amendment approved by Ohio voters in 2006.

In 2006, Ohio voters amended the State Constitution to enact a higher minimum wage that would be annually adjusted to match increases in the cost of living.  The amendment specified that only very limited groups of workers are not covered by the state minimum wage, and clearly stated that only the exemptions set forth in the constitutional amendment would apply. 

The Senate budget revision bill ignores these constitutional limits and purports to roll back minimum wage protections for any groups of workers that are not covered by the federal minimum wage, such as home care workers.  Stripping the basic minimum wage protections would not only hurt thousands of working Ohioans, it directly conflicts with the 2006 voter-approved amendment and so would be unconstitutional.   If the current measure is signed into law, it would likely lead to costly lawsuits and create uncertainty for employers and workers alike in Ohio.

“The voters spoke loud and clear in 2006 and passed a constitutional amendment that explicitly covered more workers than the federal minimum wage law,” said Zach Schiller, research director of Policy Matters Ohio.    “The General Assembly cannot circumvent the will of the voters by creating exemptions that are not authorized by the constitutional amendment.  Only Ohio’s voters can rewrite the constitution.” 

After Ohio voters approved the constitutional amendment in 2006, the Ohio legislature rushed through an implementation bill that attempted to water down the new minimum wage during the final days before Governor Ted Strickland, a minimum wage supporter, took office.  The bill, signed by Governor Bob Taft in 2007, attempted to expand the categories of workers who would not be entitled to Ohio’s minimum wage. It provided that workers would be exempt from Ohio’s minimum wage if they fell under exemptions to the federal Fair Labor Standards Act and they were excluded from the definition of employee under Ohio statute.   This law also violated the constitutional amendment by creating exemptions not provided for in the amendment.

The new proposal, however, attempts to remove minimum wage protections for more significant categories of workers, rolling back protections for thousands of working Ohioans.  Specifically, the Senate bill purports to expand the minimum wage exemption to all workers who are excluded either from the federal minimum wage or who were excluded under Ohio’s pre-2006 definition of employee.    

Among the workers who would no longer be covered under this proposal are home care workers – one of the state’s top growth occupations, providing vital services to Ohio’s elderly and disabled populations   (Previously, only live-in home care workers were excluded).  Certain agricultural workers would also lose minimum wage coverage under the legislation, along with police, firefighters, and some others.  The precise number of workers affected is not known, but it numbers in the thousands.  For example, there are nearly 80,000 personal-care or home-health aides in Ohio, and while many work in care facilities or live in customers’ homes, many thousands do not and would lose minimum-wage coverage under the bill.  

The proposed change in the law, now before the Senate Finance Committee, has been described by its sponsor, Sen. Bill Seitz, as a way to make sure the minimum wage law works as he intended when he sponsored the 2006 legislation attempting to weaken Ohio’s minimum wage.  But his intent is irrelevant, says Tsedeye Gebreselassie, a staff attorney at the National Employment Law Project.

“It’s not the legislature’s intent that matters here – it’s the voters’,” said Gebreselassie.  “The legislature had no authority to create exemptions to the Ohio constitution’s minimum wage amendment back in 2006, and it has no authority to expand them even further now.”

This bill follows similar efforts to weaken minimum wage laws in several states, including Maine, Missouri, Nevada and Florida.  In Maine, the state legislature tried unsuccessfully to roll back minimum wage protections for teenage workers.  In Missouri and Nevada, bills that would have eliminated voter-approved annual cost of living adjustments to the minimum wage similarly failed to move.  In Florida, an attempt to weaken cost of living adjustments under the state’s voter-approved minimum wage amendment was rejected by the courts.

To comply with Ohio’s Constitution, the Senate budget bill should not include these new exemptions.  The General Assembly should drop this language from the bill and fix Ohio law so it follows what the voters approved – and intended – in 2006.

Policy Matters Ohio is a non-profit, non-partisan research institute with offices in Cleveland and Columbus.

The National Employment Law Project is a legal and policy advocacy organization that works on issues affecting low-wage workers.

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 Fact Sheet on Ohio Minimum Wage Proposal (House Bill 153)

June 2011

Summary

In November 2006, Ohio voters amended the State Constitution to enact a higher state minimum wage that would be annually adjusted to match increases in the cost of living. Under the constitutional amendment, all workers who are “employees” under the federal minimum wage law are entitled to Ohio’s minimum wage. The amendment contained very narrow exemptions to this state minimum wage requirement. Importantly, the amendment did not exempt from state minimum wage coverage the categories of employees exempted from the federal minimum wage law.

After Ohio voters approved the constitutional amendment in 2006, the Ohio legislature rushed through an implementation bill that, in reality, attempted to water down the new minimum wage amendment during the final days before Governor Ted Strickland, a minimum wage supporter, took office in January 2007. But while the 2006 implementation bill attempted to create some limited exemptions that went beyond what the constitution allows, as a practical matter they were very small.

Now, however, a Senate budget revision contained in House Bill 153 attempts to remove minimum wage protections for more significant categories of workers, rolling back protections for thousands of working Ohioans. Specifically, the bill purports to expand the minimum wage exemption to all workers who are excluded either from the federal minimum wage or who were excluded under Ohio’s pre‐2006 definition of “employee.” This legislation – like the 2006 implementation bill preceding it – is clearly unconstitutional, and would result in thousands of workers losing coverage under Ohio’s state minimum wage law.

The Constitutional Amendment (2006)

§  In 2006, Ohio voters approved an amendment to the State Constitution that raised the state minimum wage from $5.15 to $6.85 per hour, and provided that it would be annually adjusted each January to match increases in the cost of living. Ohio Const. Art. II, § 34a. As of January 1, 2011, Ohio’s minimum wage is $7.40 per hour.

§  In explaining who was covered by the state minimum wage, the constitutional amendment adopted the definition of “employee” found in the federal Fair Labor Standards Act (“FLSA”) (at 29 U.S.C. § 203).

§  However, the constitutional amendment did not adopt the minimum wage exemptions contained in the FLSA, which are found in a separate section of that federal statute (at 29 U.S.C. § 213). In fact, the constitutional amendment explicitly stated that “only the exemptions set forth in this section shall apply to this section.”

§  Thus, according to the State Constitution, all workers are entitled to the state minimum wage unless they are excluded from the definition of “employee” under the federal Fair Labor Standards Act (FLSA). The only exception is for “an individual employed in or about the property of the employer or individual’s residence on a casual basis.”

§  Finally, the constitutional amendment explicitly stated that although the Legislature could pass implementing legislation to “create additional remedies, increase the minimum wage rate and extend coverage of the section”, the Legislature could not pass legislation “restricting any provision of this section.”

House Bill 690 (2006)[1]

§  After Ohio voters approved the constitutional amendment in 2006, the Ohio legislature rushed through an implementation bill that attempted to water down the new minimum wage amendment in the final days before Governor Ted Strickland, a minimum wage supporter, took office in January 2007.

§  Namely, this 2006 bill incorporated the minimum wage exemptions contained in the federal FLSA, by providing that workers would not be entitled to Ohio’s minimum wage if they were not “employees” under state law (as defined in the state’s overtime provisions) and were exempted from federal minimum wage requirements under the FLSA.

§  By incorporating the exemptions contained in the FLSA, this 2006 bill directly contravened the Ohio Constitution’s directives that “only the exemptions set forth in this section shall apply to this section,” and had the effect of impermissibly “restricting any provision of this section.” However, as a practical matter, the exemptions purportedly authorized under the 2006 bill were very small and excluded few Ohio workers.

House Bill 153 (2011)

The state budget bill now under consideration in the state Senate would go much further and squarely violate the voter‐approved constitutional amendment. It would


[1] The bill was signed into law by Governor Bob Taft in early 2007.

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