Case 22-491, Document 68, 09/28/2022, 3390401, Page1 of 43
`
`22-491
`
`United States Court of Appeals
`for the Second Circuit
`
`
`RESTAURANT LAW CENTER, NEW YORK STATE RESTAURANT ASSOCIATION,
`
`
`
`
`
`
`
`Plaintiffs-Appellants,
`
`v.
`CITY OF NEW YORK, LORELEI SALAS, in her official capacity as Commissioner
`of the New York City Department of Consumer and Worker Protection,
`
`
`
`
`
`
`
`Defendants-Appellees.
`
`On Appeal from the United States District Court
`for the Southern District of New York
`
`
`
`
`
`
`
`
`BRIEF FOR STATES OF NEW YORK, CALIFORNIA,
`CONNECTICUT, DELAWARE, ILLINOIS, MAINE, MARYLAND,
`MASSACHUSETTS, MINNESOTA, NEW MEXICO, OREGON,
`PENNSYLVANIA, RHODE ISLAND, AND WASHINGTON,
`AND THE DISTRICT OF COLUMBIA AS AMICI CURIAE
`IN SUPPORT OF APPELLEES
`
`LETITIA JAMES
` Attorney General
` State of New York
`Attorney for Amici States
`28 Liberty Street
`New York, New York 10005
`(212) 416-6184
`
`
`
`Dated: September 28, 2022
`
`
`
`BARBARA D. UNDERWOOD
` Solicitor General
`ESTER MURDUKHAYEVA
` Deputy Solicitor General
`STEPHEN J. YANNI
` Assistant Solicitor General
`
`of Counsel
`
`(Counsel listing continues on signature pages.)
`
`

`

`Case 22-491, Document 68, 09/28/2022, 3390401, Page2 of 43
`
`TABLE OF CONTENTS
`
`Page
`
`
`TABLE OF AUTHORITIES ..................................................................... iii
`INTERESTS OF AMICI STATES............................................................. 1
`STATEMENT ............................................................................................ 3
`A. The National Labor Relations Act (NLRA) .............................. 3
`B. Efforts by State and Local Governments to Address
`Unjust Working Conditions in Fast-Food Industry ................. 4
`C. New York City’s Protections for Fast-Food Employees ........... 7
`D.
`“Just Cause” Laws in Other Jurisdictions ............................. 11
`ARGUMENT
`POINT I
`THE NLRA DOES NOT PREEMPT THE WRONGFUL DISCHARGE LAW ...... 12
`A. The Wrongful Discharge Law Establishes Lawful
`Minimum Labor Standards. ................................................... 14
`B. The Wrongful Discharge Law Does Not Pressure
`Employers to Encourage Unionization. .................................. 18
`C. The Wrongful Discharge Law Does Not Regulate the
`Use of Economic Weapons. ..................................................... 21
`
`POINT II
`THE WRONGFUL DISCHARGE LAW DOES NOT VIOLATE THE
`DORMANT COMMERCE CLAUSE ............................................................. 23
`A. The Dormant Commerce Clause Does Not Displace
`State Sovereign Authority to Regulate In-State
`Economic Activity. .................................................................. 23
`i
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`Page
`
`B. The Wrongful Discharge Law Does Not Discriminate
`Against Interstate Commerce. ................................................ 25
`CONCLUSION ........................................................................................ 31
`
`
`
`
`
`
`
`
`ii
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`

`

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`
`TABLE OF AUTHORITIES
`
`Page(s)
`
`Cases
`520 South Michigan Avenue Associates v. Shannon,
`549 F.3d 1119 (7th Cir. 2008) ........................................................ 16-17
`American Ship Bldg. Co. v. NLRB,
`380 U.S. 300 (1965) ............................................................................. 21
`Associated Builders & Contractors of S. Cal., Inc. v. Nunn,
`356 F.3d 979 (9th Cir. 2004) ............................................................... 18
`Association of Car Wash Owners Inc. v. City of New York,
`911 F.3d 74 (2d Cir. 2018) .................................................................. 13
`Building & Constr. Trades Council of the Metro. Dist. v.
`Associated Builders & Contractors of Mass./R.I., Inc.,
`507 U.S. 218 (1993) ............................................................................. 13
`Cachia v. Islamorada,
`542 F.3d 839 (11th Cir. 2008) ............................................................. 30
`California Grocers Ass’n v. City of Los Angeles,
`52 Cal. 4th 177 (2011) ......................................................................... 18
`California v. ARC Am. Corp.,
`490 U.S. 93 (1989) ............................................................................... 12
`Chamber of Commerce v. Bragdon,
`64 F.3d 497 (9th Cir. 1995) ................................................................. 16
`Concerned Home Care Providers, Inc. v. Cuomo,
`783 F.3d 77 (2d Cir. 2015) ....................................................... 15-17, 19
`CTS Corp. v. Dynamics Corp. of Am.,
`481 U.S. 69 (1987) ............................................................................... 24
`Exxon Corp. v. Governor of Maryland,
`437 U.S. 117 (1978) ............................................................................. 28
`Fort Halifax Packing Co. v. Coyne,
`482 U.S. 1 (1987) ..................................................................... 12, 15, 19
`
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`Page(s)
`
`Cases
`Gibbons v. Ogden,
`22 U.S. (9 Wheat.) 1 (1824) ................................................................. 24
`Golden State Transit Corp. v. City of Los Angeles,
`475 U.S. 608 (1986) ............................................................................. 21
`H.P. Hood & Sons, Inc. v. Du Mond,
`336 U.S. 525 (1949) ............................................................................. 24
`International Franchise Ass’n v. City of Seattle,
`803 F.3d 389 (9th Cir. 2015) .......................................................... 29-30
`Johnson v. Rancho Santiago Cmty. Coll. Dist.,
`623 F.3d 1011 (9th Cir. 2010) ............................................................. 20
`Lodge 76, Int’l Ass’n of Machinists v. Wisconsin Emp. Rels. Comm’n,
`427 U.S. 132 (1976) ............................................................................. 13
`Maine v. Taylor,
`477 U.S. 131 (1986) ............................................................................. 23
`Matter of National Rest. Ass’n v. Commissioner of Labor,
`141 A.D.3d 185 (3d Dep’t 2016) .......................................................... 26
`Metropolitan Life Ins. Co. v. Massachusetts,
`471 U.S. 724 (1985) .................................................................... 4, 13-15
`New York Pet Welfare Ass’n v. City of New York,
`850 F.3d 79 (2d Cir. 2017) ....................................................... 24-26, 28
`Northern Ill. Chapter of Associated Builders & Contractors, Inc. v. Lavin,
`431 F.3d 1004 (7th Cir. 2005) ............................................................. 20
`Oregon Waste Sys., Inc. v. Department of Env’t Quality,
`511 U.S. 93 (1994) ............................................................................... 23
`Pike v. Bruce Church, Inc.,
`397 U.S. 137 (1970) ............................................................................. 25
`
`
`
`iv
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`Page(s)
`
`Cases
`Rhode Island Hosp. Ass’n v. City of Providence,
`667 F.3d 17 (1st Cir. 2011) ................................................................. 17
`Rondout Elec., Inc. v. NYS Dept. of Labor,
`335 F.3d 162 (2d Cir. 2003) ................................................................ 17
`St. Thomas–St. John Hotel & Tourism Ass’n v. Government
`of the U.S. Virgin Islands,
`218 F.3d 232 (3d Cir. 2000) .......................................................... 14, 17
`Tennessee Wine & Spirits Retailers Ass’n v. Thomas,
`139 S. Ct. 2449 (2019) ......................................................................... 24
`Town of Southold v. Town of Easthampton,
`477 F.3d 38 (2d Cir. 2007) ............................................................ 25, 28
`United States v. Pristell,
`941 F.3d 44 (2d Cir. 2019) .................................................................. 22
`United States v. Salerno,
`481 U.S. 739 (1987) ............................................................................. 22
`Washington State Grange v. Washington State Republican Party,
`552 U.S. 442 (2008) ............................................................................. 22
`
`Constitution
`U.S. Const. art. I...................................................................................... 23
`
`Laws & Regulations
`Federal
`29 U.S.C.
`§ 151 ...................................................................................................... 3
`§ 157 ...................................................................................................... 3
`§ 158 ...................................................................................................... 4
`
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`Page(s)
`
`Laws & Regulations
`States & Territories
`Mont. Code Ann. §§ 39-2-903 to 39-2-905 ............................................... 11
`P.R. Laws Ann. tit. 29, §§ 185a-185n ...................................................... 11
`V.I. Code Ann. tit. 24, § 77 ...................................................................... 11
`12 N.Y.C.R.R.
`§ 146-1.2 ................................................................................................ 6
`§ 146-3.13 .............................................................................................. 8
`Municipalities
`L.A. Cnty. Code of Ordinances § 8.100.040 .............................................. 6
`N.Y.C. Admin. Code
`§ 20-1201 et seq. .................................................................................... 7
`§ 20-1201 ...................................................................................... 7-8, 26
`§ 20-1231 ............................................................................................... 7
`§ 20-1241 ............................................................................................... 7
`§ 20-1251 ............................................................................................... 7
`§ 20-1252 ............................................................................................... 7
`§ 20-1253 ............................................................................................... 7
`§ 20-1271 ........................................................................... 1, 8-10, 21-22
`§ 20-1272 ............................................................... 1, 8-11, 14, 17, 21-22
`§ 20-1273 ......................................................................... 1, 8, 11, 14, 21
`§ 20-1274 ............................................................................... 1, 8, 11, 21
`§ 20-1275 ..................................................................................... 1, 8, 21
`§ 22-501 ............................................................................................... 22
`Phila. Code §§ 9-4701 to 9-4704 .............................................................. 11
`S.F. Admin. Code § 12R.4 .......................................................................... 6
`Seattle Mun. Code ch. 14.19...................................................................... 6
`
`
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`Legislative Sources
`Assemb. B. 257, 2021-2022 Sess. (Cal. 2022),
`https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bi
`ll_id=202120220AB257 ......................................................................... 7
`H.B. 3530/S.B. 2332, 102d Gen. Assemb. (Ill. 2021),
`https://www.ilga.gov/legislation/102/HB/PDF/10200HB3530lv.pdf ..... 12
`
`Page(s)
`
`Miscellaneous Authorities
`Center for Popular Democracy, et al., Fired on a Whim: The
`Precarious Existence of NYC Fast-Food Workers (2019),
`https://www.populardemocracy.org/sites/default/files/Just%20Ca
`use%20Complete%20Final%20-%20Web%20V2%20FINAL.pdf ......... 4
`Evelyn Bellew, et al., Low Pay, Less Predictability: Fast Food
`Jobs in California (Shift Project 2022),
`https://shift.hks.harvard.edu/wp-
`content/uploads/2022/07/CA_Fast_Food_DRAFT.pdf .......................... 4
`Letter from Nat’l Rest. Ass’n, et al., to Sen. Tim Scott
`(Mar. 21, 2022), https://restaurant.org/NRA/media/
`Downloads/PDFs/advocacy/2022/Employee-Rights-Act.pdf ................ 21
`National Emp. L. Project, Behind the Arches: How McDonald’s
`Fails to Protect Workers from Workplace Violence (2019),
`https://s27147.pcdn.co/wp-content/uploads/Behind-the-
`Arches-McDonalds-Workplace-Violence.pdf ........................................ 5
`National Rest. Ass’n, Policy Agenda,
`https://restaurant.org/issues-and-advocacy/policy-agenda/ ............... 21
`New York State, New York State’s Minimum Wage,
`https://www.ny.gov/new-york-states-minimum-wage/new-
`york-states-minimum-wage .................................................................. 6
`New York State Rest. Ass’n, Advocate,
`https://www.nysra.org/advocate.html ................................................ 21
`
`
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`Page(s)
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`Miscellaneous Authorities
`Patrick McGeehan, New York Plans $15-an-Hour Minimum
`Wage for Fast Food Workers, N.Y. Times (July 22, 2015),
`https://www.nytimes.com/2015/07/23/nyregion/new-york-
`minimum-wage-fast-food-workers.html ............................................... 6
`Restaurant L. Ctr., About,
`https://restaurantlawcenter.org/about/ .............................................. 21
`Steven Greenhouse, How the $15 Minimum Wage Went From
`Laughable to Viable, N.Y. Times (Apr. 1, 2016),
`https://www.nytimes.com/2016/04/03/sunday-review/how-
`the-15-minimum-wage-went-from-laughable-to-viable.html .............. 5
`Steven Greenhouse, Wage Strikes Planned at Fast-Food
`Outlets, N.Y. Times (Dec. 1, 2013),
`https://www.nytimes.com/2013/12/02/business/economy/wage
`-strikes-planned-at-fast-food-outlets-in-100-cities.html ...................... 5
`Sylvia Allegretto, et al., Fast Food, Poverty Wages
`(U.C. Berkeley Lab. Ctr. 2013),
`https://laborcenter.berkeley.edu/pdf/2013/fast_food_poverty_
`wages.pdf ............................................................................................... 5
`U.C. Berkeley Lab. Ctr., Inventory of US City and County
`Minimum Wage Ordinances (June 1, 2022),
`https://laborcenter.berkeley.edu/inventory-of-us-city-and-
`county-minimum-wage-ordinances/ ..................................................... 6
`Yannet Lathrop, Raises from Coast to Coast in 2022
`(Nat’l Emp. L. Project 2021), https://s27147.pcdn.co/wp-
`content/uploads/Raises-From-Coast-to-Coast-in-2022-
`report.pdf .............................................................................................. 6
`
`
`
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`INTERESTS OF AMICI STATES
`
`Amici States of New York, California, Connecticut, Delaware,
`
`Illinois, Maine, Maryland, Massachusetts, Minnesota, New Mexico,
`
`Oregon, Pennsylvania, Rhode Island, and Washington, and the District
`
`of Columbia submit this brief in support of appellees City of New York
`
`and the Commissioner of the New York City Department of Consumer and
`
`Worker Protection. In this case, two restaurant industry groups challenge
`
`the City’s Wrongful Discharge Law, which prohibits qualifying fast-food
`
`establishments from discharging employees without just cause and allows
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`employees to arbitrate claims of wrongful discharge. See N.Y.C. Admin.
`
`Code §§ 20-1271 to 20-1275. The U.S. District Court for the Southern
`
`District of New York (Cote, J.) held that the National Labor Relations
`
`Act (NLRA) does not preempt the law and that the law does not violate
`
`the dormant Commerce Clause. This Court should affirm.
`
`Amici have a substantial sovereign interest in exercising their police
`
`powers to enact and enforce laws promoting the health, safety, and welfare
`
`of their residents, including employees in the fast-food industry. Amici
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`regularly enforce their labor laws to address violations of state minimum
`
`wage, overtime, prevailing wage, and other labor protections through
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`investigations and enforcement actions undertaken by state attorneys
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`general and departments of labor. Amici therefore have a substantial
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`interest in ensuring that these sovereign powers are unencumbered by
`
`an overly broad view of NLRA preemption and the dormant Commerce
`
`Clause, two doctrines that are not intended to tread on established areas
`
`of state authority.
`
`This case implicates amici’s interests because appellants seek to
`
`invalidate a City law that falls squarely within the ambit of traditional
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`state and local regulation aimed at protecting vulnerable workers. Amici
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`have long relied on well-settled precedent holding that the Machinists
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`strand of NLRA preemption does not extend to state-law minimum labor
`
`standards such as the just-cause protections of the Wrongful Discharge
`
`Law because such laws do not interfere with the collective-bargaining
`
`process governed by the NLRA. Accepting appellants’ expansive view of
`
`Machinists preemption could therefore imperil countless state and local
`
`laws governing wages, health and safety rules, and mandatory benefits.
`
`Amici have also long regulated employment conditions in their
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`States, notwithstanding the fact that such regulations could have inciden-
`
`tal effects on interstate commerce given the interconnected nature of the
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`2
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`modern economy. A ruling in favor of appellants could unsettle amici’s
`
`longstanding practices and undermine future efforts to protect workers
`
`through legislation and enforcement actions.
`
`STATEMENT
`
`A. The National Labor Relations Act (NLRA)
`The NLRA provides that it is the policy of the United States to
`
`eliminate obstructions to commerce “by encouraging the practice and
`
`procedure of collective bargaining and by protecting the exercise by
`
`workers of full freedom of association, self-organization, and designation
`
`of representatives of their own choosing.” 29 U.S.C. § 151. The NLRA
`
`embodies Congress’s determination that protecting “the right of employees
`
`to organize and bargain collectively” promotes the flow of commerce by
`
`removing “sources of industrial strife and unrest” and “restoring equality
`
`of bargaining power between employers and employees.” Id.
`
`Section 7 of the NLRA gives employees the “right to self-organization,
`
`to form, join, or assist labor unions, to bargain collectively through
`
`representatives of their own choosing, and to engage in concerted activities
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`for the purpose of collective bargaining.” Id. § 157. Section 8 requires
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`employers to bargain collectively with employees through representatives
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`3
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`of the employees’ choosing and prohibits certain restrictions on the
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`collective-bargaining process. Id. § 158.
`
`As the Supreme Court has recognized, the NLRA is fundamentally a
`
`procedural statute. See Metropolitan Life Ins. Co. v. Massachusetts, 471 U.S.
`
`724, 753-54 (1985). The NLRA establishes and governs the process by which
`
`employees organize into unions as well as the process by which unions and
`
`employers collectively bargain. However, the statute does not contemplate,
`
`much less compel, any particular outcome of the collective-bargaining
`
`process. Accordingly, the NLRA neither requires nor forbids unionization
`
`and neither requires nor forbids any substantive term of employment.
`
`B. Efforts by State and Local Governments to Address Unjust
`Working Conditions in Fast-Food Industry
`State and local governments have long been concerned with abusive
`
`and unjust working conditions in the fast-food industry. Fast-food workers
`
`suffer from low pay, unpredictable schedules, and unexplained termina-
`
`tion and hours reductions.1 As a result, fast-food workers are more likely
`
`
`1 See, e.g., Evelyn Bellew, et al., Low Pay, Less Predictability: Fast
`Food Jobs in California (Shift Project 2022) (internet); Ctr. for Popular
`Democracy, et al., Fired on a Whim: The Precarious Existence of NYC
`(continued on the next page)
`
`
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`4
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`to rely on public assistance programs and to live in poverty.2 Because
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`fast-food workers are often engaged in late-night retail, they are also at
`
`increased risk of workplace violence.3 Over the past decade, workers have
`
`organized protests and strikes in more than 150 cities nationwide to
`
`demand labor reforms, including most prominently a $15-per-hour mini-
`
`mum wage.4
`
`State and local governments have responded by enacting new laws
`
`to protect fast-food workers and other vulnerable employees. Since 2014,
`
`numerous cities, including Seattle, San Francisco, and Los Angeles, have
`
`adopted ordinances increasing minimum wages for fast-food workers and
`
`
`Fast-Food Workers (2019) (internet). (For sources available online, full
`URLs appear in the Table of Authorities. All URLs were last visited on
`September 28, 2022.)
`2 See Sylvia Allegretto, et al., Fast Food, Poverty Wages (U.C.
`Berkeley Lab. Ctr. 2013) (internet).
`3 See Nat’l Emp. L. Project, Behind the Arches: How McDonald’s
`Fails to Protect Workers from Workplace Violence (2019) (internet).
`4 See, e.g., Steven Greenhouse, Wage Strikes Planned at Fast-Food
`Outlets, N.Y. Times (Dec. 1, 2013) (internet); Steven Greenhouse, How
`the $15 Minimum Wage Went From Laughable to Viable, N.Y. Times
`(Apr. 1, 2016) (internet).
`
`
`5
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`others.5 In 2015, New York State’s Department of Labor (DOL) issued a
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`minimum-wage order increasing the statewide minimum wage for fast-
`
`food workers to $15 per hour by 2021. See 12 N.Y.C.R.R. § 146-1.2(a)(2).6
`
`Shortly thereafter, New York State enacted a law that gradually achieves
`
`a statewide $15 minimum wage.7 Between 2012 and 2022, the number of
`
`counties and cities with minimum-wage laws has increased from five to
`
`55.8 In 2022, a record number of States and localities are expected to raise
`
`their minimum wages for fast-food workers and others, with many meet-
`
`ing or exceeding $15 per hour.9 Most recently, California enacted legisla-
`
`tion establishing a Fast Food Council to prescribe “sectorwide minimum
`
`standards on wages, working hours, and other working conditions” for
`
`
`5 See, e.g., Seattle Mun. Code ch. 14.19; S.F. Admin. Code § 12R.4;
`L.A. Cnty. Code of Ordinances § 8.100.040.
`6 See also Patrick McGeehan, New York Plans $15-an-Hour Mini-
`mum Wage for Fast Food Workers, N.Y. Times (July 22, 2015) (internet).
`7 N.Y. State, New York State’s Minimum Wage (internet).
`8 U.C. Berkeley Lab. Ctr., Inventory of US City and County Minimum
`Wage Ordinances (June 1, 2022) (internet).
`9 See Yannet Lathrop, Raises from Coast to Coast in 2022 (Nat’l Emp.
`L. Project 2021) (internet).
`
`
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`the fast-food industry in the State. Assemb. B. 257, 2021-2022 Sess. (Cal.
`
`2022) (internet).
`
`C. New York City’s Protections for Fast-Food Employees
`In 2017, New York City enacted the Fair Work Practices Law, a
`
`series of ordinances aimed at expanding wage and hour and other labor
`
`protections for fast-food employees. See Admin. Code § 20-1201 et seq.
`
`Among other things, the law (i) forbids employers from scheduling
`
`employees for consecutive shifts that involve closing the restaurant and
`
`opening it just hours later, id. § 20-1231; (ii) requires employers to offer
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`additional shifts to current employees before hiring new employees, id.
`
`§ 20-1241; and (iii) requires employers to provide employees advance
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`notice of work schedules, id. §§ 20-1251 to 20-1253.
`
`The Fair Work Practices Law applies only to “fast food establish-
`
`ments” that are part of a chain including “30 or more establishments
`
`nationally.” Id. § 20-1201. The numerical metric was derived from the
`
`New York State DOL’s minimum-wage increase for fast-food employees,
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`which applied “only to fast food chains with 30 or more locations
`
`
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`nationally.”10 (See Joint Appendix (J.A.) 1740 (quotation marks omitted).)
`
`See also 12 N.Y.C.R.R. § 146-3.13. A restaurant qualifies as a fast-food
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`establishment for purposes of the City’s law regardless of whether it is
`
`part of “an integrated enterprise that owns or operates 30 or more such
`
`establishments,” or operates under a franchise “where the franchisor and
`
`the franchisees of such franchisor own or operate 30 or more such
`
`establishments.” Admin. Code § 20-1201.
`
`In 2021, New York City enacted the Wrongful Discharge Law, which
`
`amended the 2017 law to provide additional protections for fast-food
`
`workers, many of whom were disproportionately affected by the Covid-19
`
`pandemic and its attendant disruptions. Id. §§ 20-1271 to 20-1275. (See
`
`J.A. 1749-1750, 1754.) The New York City Council committee report
`
`prepared for the Wrongful Discharge Law observed that complaints of
`
`wrongful discharge are common in the fast-food industry, which employs
`
`
`10 As DOL explained, “chains of this size are better equipped to
`absorb a wage increase due to greater operational and financial resources,
`and brand recognition.” (Joint Appendix (J.A.) 1740 (quotation marks
`omitted).) DOL also promulgated guidance confirming that, in addition
`to national chains, “local chains that only have locations within New York
`State are covered [by the minimum-wage order] as long as they have at
`least 30 locations.” (J.A. 1741 (quotation marks omitted).)
`
`8
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`more than 67,000 people at more than 3,000 establishments in New York
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`City. Fast-food employers frequently terminate employees without
`
`explanation or reduce their hours, resulting in financial hardship and
`
`exacerbating the already pervasive mistreatment of fast-food workers,
`
`who often belong to vulnerable populations. (J.A. 1519-1520.)
`
`In response to these concerns, the Wrongful Discharge Law bars
`
`fast-food employers from “discharg[ing] a fast food employee who has
`
`completed such employer’s probation period except for just cause or for a
`
`bona fide economic reason.” Admin. Code § 20-1272(a). A “discharge”
`
`includes “any cessation of employment,” including not only termination
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`but also a reduction in hours of at least 15 percent. Id. § 20-1271. “Just
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`cause” for discharging an employee must consist of “the fast food
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`employee’s failure to satisfactorily perform job duties or misconduct that
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`is demonstrably and materially harmful to the fast food employer’s
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`legitimate business interests.” Id. A “bona fide economic reason” for
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`discharging an employee “means the full or partial closing of operations
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`9
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`Case 22-491, Document 68, 09/28/2022, 3390401, Page19 of 43
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`or technological or organizational changes to the business in response to
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`the reduction in volume of production, sales, or profit.” Id.11
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`The Wrongful Discharge Law also establishes procedures that
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`employers must follow in discharging employees. For example, absent an
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`egregious failure to perform duties or egregious misconduct, an employer
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`may not terminate an employee without utilizing a written progressive-
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`discipline policy.12 Id. § 20-1272(c). An employer must also provide a
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`written explanation for the discharge within five days. Id. § 20-1272(d).
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`In addition, “[d]ischarges of fast food employees based on bona fide econo-
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`mic reason shall be done in reverse order of seniority.” Id. § 20-1272(h).
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`An employee may sue to challenge a discharge, and in such a
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`proceeding, the employer “shall bear the burden of proving just cause or
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`a bona fide economic reason by a preponderance of the evidence.” Id. § 20-
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`1272(e). An employee also has the option of challenging a discharge in an
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`11 See also Admin. Code § 20-1272(g) (“A discharge shall not be
`considered based on a bona fide economic reason unless supported by a
`fast food employer’s business records showing that the closing, or techno-
`logical or reorganizational changes are in response to a reduction in volume
`of production, sales, or profit.”).
`12 “Progressive discipline” refers to a system with a “graduated range
`of reasonable responses” to deficient employee performance, “ranging from
`mild to severe.” Admin. Code § 20-1271.
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`10
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`Case 22-491, Document 68, 09/28/2022, 3390401, Page20 of 43
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`arbitration proceeding, individually or on behalf of a class. Id. § 20-1273.
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`A wrongfully discharged employee is entitled to reinstatement, attorney’s
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`fees, and certain other damages. Id. §§ 20-1272(f), 20-1274.
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`D.
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`“Just Cause” Laws in Other Jurisdictions
`Numerous other jurisdictions have enacted “just cause” laws that
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`provide protections comparable to the City’s law. For example, Montana
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`prohibits discharging non-probationary employees without just cause
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`based on “reasonable job-related grounds” or “other legitimate business
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`reasons”; in such cases, wrongfully discharged employees may recover lost
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`wages. Mont. Code Ann. §§ 39-2-903 to 39-2-905. Likewise, Puerto Rico
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`mandates severance pay to employees who are discharged without just
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`cause. P.R. Laws Ann. tit. 29, §§ 185a-185n. The U.S. Virgin Islands
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`requires employers to reinstate wrongfully discharged employees with
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`backpay. V.I. Code Ann. tit. 24, § 77. And a Philadelphia ordinance prohi-
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`bits parking employers from terminating, suspending, or reducing the
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`hours of parking employees absent just cause or a bona fide economic
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`reason and requires the use of a progressive discipline policy. Phila. Code
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`§§ 9-4701 to 9-4704.
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`
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`11
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`Case 22-491, Document 68, 09/28/2022, 3390401, Page21 of 43
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`Other jurisdictions are considering “just cause” laws. For example,
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`a bill introduced in the Illinois legislature would protect employees from
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`discharge without just cause or a bona fide economic reason, require utili-
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`zation of a progressive discipline policy, limit the electronic surveillance
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`of employees, and provide for severance pay. H.B. 3530/S.B. 2332, 102d
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`Gen. Assemb. (Ill. 2021) (internet).
`
`ARGUMENT
`
`POINT I
`
`THE NLRA DOES NOT PREEMPT THE WRONGFUL DISCHARGE LAW
`When assessing whether federal law impliedly preempts a field
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`traditionally occupied by the States, a court must “start with the assump-
`
`tion that the historic police powers of the States were not to be superseded
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`by the Federal Act unless that was the clear and manifest purpose of
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`Congress.” California v. ARC Am. Corp., 490 U.S. 93, 101 (1989) (quotation
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`marks omitted). The Supreme Court has made clear that “pre-emption
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`should not be lightly inferred in” the area of labor law because “the
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`establishment of labor standards falls within the traditional police power
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`of the State.” Fort Halifax Packing Co. v. Coyne, 482 U.S. 1, 21 (1987); see
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`
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`12
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`Case 22-491, Document 68, 09/28/2022, 3390401, Page22 of 43
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`also Building & Constr. Trades Council of the Metro. Dist. v. Associated
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`Builders & Contractors of Mass./R.I., Inc., 507 U.S. 218, 224 (1993).
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`Nevertheless, the Supreme Court has recognized that the NLRA
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`has preemptive effect in certain narrow areas. As relevant here, under
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`the doctrine of Machinists preemption, state and local laws are preempted
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`where they interfere with federal policy to leave certain aspects of the
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`bargaining process between employers and employees “unregulated
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`[because it should] be controlled by the free play of economic forces.” Lodge
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`76, Int’l Ass’n of Machinists v. Wisconsin Emp. Rels. Comm’n, 427 U.S.
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`132, 144 (1976). The scope of Machinists preemption is narrowly directed
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`toward maintaining “an equitable process for determining terms and
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`conditions of employment,” rather than controlling the “particular substan-
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`tive terms” of employment. Metropolitan Life, 471 U.S. at 753 (emphasis
`
`added); accord Association of Car Wash Owners Inc. v. City of New York,
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`911 F.3d 74, 81 (2d Cir. 2018). It is accordingly well established that the
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`NLRA does not preempt state and local laws establishing minimum labor
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`standards because such statutes govern the substantive terms of the
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`employment relationship and have only “the most indirect effect on the
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`
`
`13
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`Case 22-491, Document 68, 09/28/2022, 3390401, Page23 of 43
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`right of self-organization established in the” NLRA. Metropolitan Life,
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`471 U.S. at 755.
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`A. T