Worker Power PAC v. City of Glendale

1

WORKER POWER PAC, et al., Plaintiffs/Appellees, v. CITY OF GLENDALE, et al., Defendants/Appellants.

No. 1 CA-CV 24-0593 EL

Court of Appeals of Arizona, First Division

August 22, 2024

Not for Publication - Rule 111(c), Rules of the Arizona Supreme Court

Appeal from the Superior Court in Maricopa County No. CV2024-019995 The Honorable Scott McCoy, Judge

Barton Mendez Soto PLLC, Tempe By James E. Barton II, Jacqueline Mendez Soto, and Daniella Fernandez Lertzman Counsel for Plaintiffs/Appellees

Pierce Coleman PLLC, Scottsdale By Christina Estes-Werther, Aaron D Arnson, and Matthew W. Schiumo Counsel for Defendants/Appellants

Snell & Wilmer L.L.P., Phoenix By Eric H. Spencer, Derek C Flint, and Cole M. Craghan Counsel for Amici Curiae Arizona Lodging and Tourism Association and the American Hotel and Lodging Association

Arizona Chamber of Commerce and Industry, Phoenix By Michael G. Bailey and Nate Curtisi Counsel for Amicus Curiae Arizona Chamber of Commerce and Industry

Judge Paul J. McMurdie delivered the Court's decision, in which Presiding Judge Jennifer B. Campbell and Vice Chief Judge Randall M. Howe joined.

MEMORANDUM DECISION

MCMURDIE, JUDGE

¶1 The City of Glendale and the Glendale City Clerk appeal the superior court's order granting Worker Power PAC and Brendan Walsh's application for a preliminary injunction. We affirm.

FACTS AND PROCEDURAL BACKGROUND

¶2 In July 2023, Brendan Walsh submitted an initiative on behalf of Worker Power PAC (collectively, "Worker Power") for the November 2024 ballot. The initiative, the Hotel and Event Center Minimum Wage and Wage Protection Act, "add[s] Article VII to Chapter 21 of the Glendale Municipal Code; relating to minimum wage and wage protection." (Capitalization omitted.) The initiative aims "to regulate the minimum wages and benefits of hotel and event center employees."

¶3 Section 21-188 of the initiative requires a hotel employer to provide twice the rate of regular pay to a hotel worker who cleans a space exceeding a certain square footage, calculated based on factors such as the number of guest rooms, floors, buildings, and hours worked in a day. That section also provides that a hotel employer cannot require or allow a hotel worker to work more than ten hours per day without the worker's written consent; the hotel employer must notify the employee in writing that working more than ten hours is not mandatory.

¶4 Section 21-189 sets a minimum wage for hotel and event center workers, which will increase annually based on the cost of living starting in 2025. Section 21-190 requires hotel or event center employers to distribute service charges paid by customers to the workers who performed those services. It also prohibits employers from deducting the service charge distributions from the employee's hourly compensation.

¶5 Section 21-196 establishes the Department of Labor Standards, led by a Director of Labor Standards, to receive employee complaints and investigate and enforce the initiative's provisions against employers. This Section authorizes the Director to promulgate regulations to further the initiative and requires wage investigators to investigate suspected violations, communicate with complainants, report violations, and enforce the provisions under the Director's supervision.

¶6 Section 21-197 requires hotel and event center employers to give the City access to pertinent records and authorizes the City to initiate civil actions against hotel and event center employers. It also requires the Director to take enforcement action against employers who violate any initiative section. Section 21-194 provides that a violation of administrative regulations adopted by the Department to support the initiative's provisions violates the initiative. Sections 21-191 and 21-195 provide waiver opportunities. A collective bargaining agreement may waive sections 21-188 through 21-290, and the Director must waive the initiative requirement if the employer proves the requirement would impact certain economic metrics.

¶7 Section 21-192 requires hotel or event center employers to provide written notice to workers of their rights as outlined in the initiative. Section 21-193 prohibits employers from retaliating against a hotel or event center worker for asserting their rights established in the initiative. Section 21-198 creates a private cause of action for hotel and event center workers against their employers if they are aggrieved by an employer's violation of their rights in the initiative.

¶8 The City Clerk rejected the initiative application because it did "not meet the constitutional requirement for placement on the ballot." The City Clerk found that the initiative violated Article 4, Part 1, Section 1(9) of the Arizona Constitution because the measure was not "limited to one subject." See Ariz. Const. art. 4, pt. 1, § 1(9) (form and contents of initiative and referendum petitions).

¶9 Worker Power filed for statutory special action relief seeking a writ of mandamus to "compel[] the City Clerk to receive and process the [i]nitiative." Worker Power also moved for a preliminary injunction ordering the City Clerk to keep processing the initiative while the action was pending. Worker Power argued that the City Clerk lacked the authority to reject the initiative, and the initiative complied with the Arizona Constitution's single-subject rule. The City moved to dismiss the statutory special action complaint. It opposed the preliminary injunction, arguing that the initiative did not comply with the single-subject rule or the title requirement under Article 4, Part 1, Section 1(9) of the Arizona Constitution.

¶10 After receiving briefing from the parties and amici curiae, the superior court denied the motion to dismiss, granted the preliminary injunction application, and ordered the City Clerk to accept and process the initiative. The court found that the initiative embraces "one general subject" because it "establishes a minimum wage for hotel and convention center workers within the City" and "provides mechanisms to enforce the new wage and to prevent employers from circumventing it." It also found that Worker Power showed "a strong probability of succeeding on the merits," "a strong possibility of irreparable harm," "[t]he balance of hardships favor[ed] Worker Power," and "Arizona's public policy strongly favors the initiative process."

¶11 The City appealed. Because this is an expedited election matter, this court held an Arizona Rules of Civil Appellate Procedure ("ARCAP") 10(g) scheduling conference with the parties and ordered simultaneous briefing from the City and Worker Power. Amici curiae agreed to rest on their briefs presented to the superior court.

¶12 We have jurisdiction to review the order granting the preliminary injunction under A.R.S. § 12-2101(A)(5)(b).^[1]

DISCUSSION

¶13 We review the superior court's order granting a preliminary injunction for an abuse of discretion. Shinn v. Ariz. Bd. of Exec. Clemency, 254 Ariz. 255, 259 ¶ 13 (2022). The superior court abuses its discretion if it makes a legal error or issues an order unsupported by the record. Id.

¶14 The superior court may issue an injunction to compel positive action by the enjoined party. See State ex rel. Corbin v. Portland Cement Ass'n, 142 Ariz. 421, 425 (App. 1984); see also McNally v. Sun Lakes Homeowners Ass'n #1, Inc., 241 Ariz. 1, 3, 5, ¶¶ 9, 23 (App. 2016). "To grant a preliminary injunction, the [superior] court must find (1) a strong likelihood of success on the merits; (2) a possibility of irreparable injury to the requesting party irremediable without relief; (3) the balance of hardships favors the requesting party; and (4) public policy favors the injunction." Shinn, 254 Ariz. at 259, ¶ 14.

¶15 The City argues the superior court erred by granting the preliminary injunction because the initiative did not comply with the Arizona Constitution's single-subject rule or title requirement. Whether the initiative complied with the Arizona Constitution is a legal question, which we review de novo. See State v. Hansen, 215 Ariz. 287, 289, ¶ 6 (2007).

¶16 The Arizona Constitution requires every legislative act to "embrace but one subject and matters properly connected therewith"-the single-subject rule. Ariz. Const. art. 4, pt. 2, § 13; Ariz. Sch. Bds. Ass'n, Inc. v. State, 252 Ariz. 219, 226, ¶ 25 (2022). And the single subject in the legislative act "shall be expressed in the title"-the title requirement. Id. The single-subject rule's purpose is "to prevent 'log-rolling,' or combining different measures into one bill so that a legislator must approve a disfavored proposition to secure passage of a favored proposition." Hoffman v. Reagan, 245 Ariz. 313, 316, ¶ 14 (2018) (citation omitted). The title requirement informs the public of the legislation's subject matter and prevents surprise. In re Lewkowitz, 70 Ariz. 325, 331-32 (1950); Taylor v. Frohmiller, 52 Ariz. 211, 215 (1938).

¶17 Until recently, the single-subject rule and the title requirement did not apply to initiatives. See Ariz. Chamber of Com. &Indus. v. Kiley, 242 Ariz. 533, 541-42, ¶¶ 33-34 (2017). But as of December 2022, initiatives "shall embrace but one subject and matters properly connected therewith, which subject shall be expressed in the title." Ariz. Const. art. 4, pt. 1, § 1(9). The single-subject rule and title requirement for legislative acts and initiatives are virtually identical. Compare Ariz. Const. art. 4, pt. 1, § 1(9), with Ariz. Const. art. 4, pt. 2, § 13. Thus, following the parties' lead, we look to pre-existing caselaw to interpret the single-subject rule and the title requirement for guidance in this case.

A. The Initiative Complied with the Single-Subject Rule.

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