By Thomas R. Julin, a Shareholder in the Miami, FL office of Gunster Yoakley & Stewart, P.A.
In 2015, San Francisco became the first city in the nation to require that employers predict their employees’ schedules and to punish them if they got it wrong.1 The city’s Board of Supervisors adopted the ordinance with an eye toward shrinking the gap between the cost of living and employee wages. While the role of government in addressing such a wage gap is a matter of vigorous debate, predictable-scheduling mandates are not a viable solution because they violate the First Amendment rights of employers.
The cost of living in the Bay Area has skyrocketed due to the wild success of tech companies headquartered in the area. In 2017, the Board raised the city’s minimum wage to $14 per hour.2 Even so, a renter needs to earn about $34.88 per hour to afford a one-bedroom apartment and about $44.02 for a two-bedroom apartment—the equivalent of two-and-a-half minimum-wage jobs.3
San Francisco viewed government-mandated predictable scheduling as a possible solution to the high cost of living, or at least a step in the right direction. At its heart, the ordinance requires that covered employers provide new employees with a good-faith written estimate of the employee’s expected minimum number of scheduled shifts per month and the days and hours of those shifts. 4 Employers must also provide employees with their schedules two weeks in advance. Schedules may be posted in the workplace or provided electronically, so long as employees are given access to the electronic schedules at work.5 If schedule changes are made with less than seven days’ notice, the employer must pay the employee a premium of 1 to 4 hours of pay at the employee’s regular hourly rate (depending on the amount of notice and length of the shift).6
Employers must factor in both routine, hard-to-predict events such as weather, supply shortages, and product flops or recalls, and impossible-to-predict disasters such as earthquakes, riots, and even terrorist attacks. If any such unexpected event mandated a rapid staffing change to mitigate losses or capitalize on good fortune, the employers then would have to share their gains or losses with disrupted workers through predictability pay.
Other cities have watched San Francisco’s experiment carefully. Seattle quickly followed suit,7 and, as of this writing, cities in at least 13 states and the District of Columbia were considering such laws.8 On May 30, 2017, New York City Mayor Bill de Blasio signed his city’s first predictable scheduling law.9 It applies to “fast food employees.”
Employers subject to predictable-scheduling ordinances have an ally on their side to which adopting cities have likely been oblivious: the First Amendment. It “is … a basic First Amendment principle that ‘freedom of speech prohibits the government from telling people what they must say.’”10 An exception to this broad principle is that mere “disclosure requirements,” such as those relating to campaign contributions,11 lobbyist expenditures,12 and commercial speech,13 will generally be upheld if “reasonably related” to legitimate state objectives.14 Courts have had difficulty determining which compelled speech regulations fall within this exception,15 but a consensus is building that if a compelled speech regulation does more than require disclosure of “purely factual and uncontroversial” matters, it must be subjected to at least heightened scrutiny and likely will not stand.16
Predictable-scheduling ordinances compel speech that is neither factual nor uncontroversial. Labor schedules are suppositions about future needs, not facts. They are based on a myriad of opinions about weather, competition, the minimum wage, the labor market, consumer trends, and business plans. Because so many factors go into schedules, they are controversial and often wrong.
If courts were to conclude that predictable-scheduling ordinances do compel speech, they would have to survive heightened scrutiny. To avoid determining how high the scrutiny bar must be set for new First Amendment challenges, courts commonly first evaluate whether a law could survive intermediate scrutiny. 17 Under such scrutiny, a reviewing court will ask: Does a predictable-scheduling ordinance directly and materially advance an important governmental interest that cannot be achieved in other ways? With regards to the interest advanced, as discussed above, San Francisco adopted its law in part to address the increased cost of living. A court would likely find that to be an important goal, but the city will be hard pressed to demonstrate that the ordinance “directly and materially” advances that interest. One study has shown that predictable-scheduling ordinances can result in fewer employees being hired. A 2016 Employment Policy Institute study found 21 percent of San Francisco employers now offer fewer part-time jobs, 19 percent scheduled fewer employees per shift, and 17 percent offer fewer jobs, part or full-time.18
These unintended impacts must be weighed against any benefits delivered by the challenged law. If a predictable-scheduling ordinance is reducing job opportunities, and a government interest in adopting it was to narrow the wage gap, a city will be hard pressed to demonstrate any overarching benefits. Also, another direct result of a scheduling ordinance could be employers’ conscious decision to violate the law and simply pay the fine—a maneuver that in some instance makes the most economic sense. If either of those outcomes are a direct result of the challenged law, a court could easily conclude that one readily available less-restrictive alternative to a speech mandate is an increased minimum wage.
Employee scheduling constitutes speech under the First Amendment, and predictable-scheduling ordinance require employers to alter that speech in a manner that is non-factual and is highly controversial. It follows, then, that the city enacting such a law must, at a minimum, demonstrate that the law directly and materially advances an important state interest, and is no more restrictive of speech than necessary. If employers lodge a constitutional challenge, cities will likely be unable to meet that stringent First Amendment test.
- San Francisco Ord. 236-14, File No. 140880 (Eff. Jan. 4, 2015, Operational July 3, 2015) (codified as San Francisco Police Code Art. 33F).
- San Francisco Admin. Code § 12R.4.
- See National Low Income Housing Coalition, Out of Reach 2016: California, http://nlihc.org/oor/california.
- San Francisco Police Code § 3300G.4(a).
- Id. at § 3300G.4(c).
- Id. at § 3300G.4(c).
- Seattle Ord. 125135 (Sept. 29, 2016).
- The Center for Law and Social Policy, A National Repository of Resources on Job Scheduling Policy, http://www.clasp.org/issues/work-life-and-job-quality/scheduling-resources (collecting bills introduced throughout the United States since 2015).
- New York City Local Law No. 107 (2017) (amending Title 20 of the New York City Administrative Code to create new chapters 11 and 12).
- United States Agency for Int’l Dev. v. Alliance for Open Soc’y Int’l, 133 S. Ct. 2321, 2327 (2013) (quoting Rumsfeld v. Forum for Academic & Institutional Rights, Inc., 547 U.S. 47, 61 (2006) (citing W. Va. State Bd. of Ed. v. Barnette, 319 U.S. 624, 642 (1943), and Wooley v. Maynard, 430 U.S. 705, 717 (1977))).
- Citizens United v. Fed. Election Comm’n, 558 U.S. 310, 371 (2010).
- United States v. Harriss, 347 U.S. 612, 625–26 (1954).
- Milavetz Gallop & Milavetz, P.A. v. United States, 559 U.S. 229 (2010) (attorney advertising); Zauderer v. Office of Disciplinary Counsel of Supreme Court of Ohio, 471 U.S. 626 (1985) (same).
- See Milavetz, 559 U.S. at 1331; Zauderer, 471 U.S. at 651.
- See Am. Beverage Ass’n v. City & County of San Francisco, Nos. 16-16072 & 16-16073, 2017 WL 4126944 (9th Cir. 2017).
- Am. Beverage Ass’n, 2017 WL 4126944 at *5.
- See, e.g., Sorrell v. IMS Health Inc., 131 S. Ct. 2653, 2667 (2011).
- Aaron Yelowitz & Aaron Corder, Weighing Priorities for Part-Time Workers—An Early Evaluation of San Francisco’s Formula Retail Scheduling Ordinance (May 2016), available at https://www.epionline.org/studies/weighing-priorities-for-part-time-workers/.