Arizona Supreme Court rejects minimum-wage challenge

Corrections & clarifications: A previous version was unclear about Gov. Doug Ducey's position on Prop. 206. He spoke against it but did not actively campaign against it.

Arizona's minimum-wage law will stand, after a unanimous Arizona Supreme Court late Tuesday rejected a challenge to the voter-approved law.

"The people win again. Unanimously," attorney Jim Barton said in an email as the court's order came down in the closing minutes of the business day.

He represented the committee that brought Proposition 206 to the ballot in November. The state Attorney General's Office also defended the law.

Attorney General Mark Brnovich praised the ruling in a statement issued by his office.

“As Attorney General, my job is to uphold the rule of law," he said. "The constitution is designed to protect our rights. It's not a tool to be used to undermine the will of the people."

Chief Justice Scott Bales issued the order, stating the seven-member court unanimously rejected the arguments from business groups that the law is unconstitutional. A detailed explanation of the court's reasoning will come later, Bales wrote.

DIAZ: Minimum-wage victory shows court's independence

The Arizona Chamber of Commerce and Industry led the challenge, asking the court to overturn the law, which will raise Arizona's minimum wage to $12 an hour by 2020. It also requires employers to offer mandatory paid sick leave as of July 1.

Business groups disappointed, respectful

Brett Johnson, the attorney for the business groups, argued the measure violated a state constitutional requirement that any voter initiative that costs the state money must identify a funding source. The state is exempt from the law. But business groups, with some support from various state agencies, argued the higher wage is forcing the state to spend more on contracts with health- and social-service providers, thereby imposing more spending on state government.

In a statement, Glenn Hamer, the president and CEO of the chamber, said the groups were grateful the court agreed to hear their challenge.

"While we’re disappointed that the result did not go our way, we respect the court’s ruling," he said. "Lawmakers and the governor can now craft a state budget that considers the law’s impact on state revenues, and employers can calibrate their operations with the understanding that the minimum wage and paid leave law will stand.”

Gov. Doug Ducey, who opposed Prop. 206, said, "The Supreme Court has spoken. We're going to follow the law."

The court heard arguments on the case last Thursday.

Prop. 206 boosted Arizona's minimum wage to $10 an hour on Jan. 1, up from the previous $8.05 an hour. It will increase in 50-cent increments on the first of each succeeding year, topping out at $12 an hour in 2020.

Tomas Robles, chairman of the Prop. 206 campaign, called the court's ruling a victory for Arizona working people.

"We are very proud and ecstatic that Prop 206 will remain intact, and will continue to benefit the families and workers of this great state," he said. Robles also is co-director of LUCHA, which advocates for social and political reforms and played a key role in promoting Prop. 206.

With the law now settled, state lawmakers and Ducey now face the task of finding the money to pay service providers. They say they need more money in their contracts if they are to continue to caring for some of Arizona’s most vulnerable populations.

Meanwhile, businesses will have to work out how to deal with the increasing wage, as well as the provision that requires them to provide paid sick leave.

Reach the reporter at maryjo.pitzl@arizonarepublic.com and follow her on Twitter @maryjpitzl.