I wrote about this quite awhile ago.
In this particular case, a class action lawsuit was filed on behalf of 219 Cintas employees who alleged that they were not appropriately because they had not been paid according to the living wage as was determined by the city of Hayward, CA.
These workers, although not employed in the city of Hayward, worked specifically on a contract with the city of Hayward. Cintas argued saying that the ordinance shouldn’t apply to workers outside Hayward. An Alameda County Court decided otherwise, to the tune of over one million dollars, albeit with the caveat that the failure to pay the living wage was not willful on the part of Cintas. Cintas subsequently appealed stating that Hayward’s ordinance was ambiguous and confusing.
Very recently, the First District Appellate Court upheld all of the rulings made by the Trial Court. According to Wage Law (fast becoming one of my favorite blogs):
Until last month, no California appellate decision had construed the requirements of any municipality’s living wage ordinance, or addressed the constitutional challenges to any such ordinances. Now, however, most of the defenses commonly raised when employers challenge living wage ordinances have been rejected in an opinion published last month by the First District Court of Appeal in Amaral v. Cintas Corporation No. 2 (2008) __ Cal.App.4th __. Amaral addressed the constitutionality and application of a living wage ordinance enacted by the City of Hayward and incorporated into its municipal contracts. Defendant Cintas entered into such contracts with the City, but did not provide the minimum wages or benefits required by the ordinance to employees who worked in the company’s stockroom or laundry production facilities, which are located outside the City of Hayward. Some of those employees filed a class action seeking the living wages due, benefits, civil penalties and waiting time penalties. On cross-motions for summary judgment, the trial court found that Cintas violated the ordinance, which was enforceable; that it breached its contracts with the City, and violated the Unfair Competition Law and numerous Labor Code provisions. The court awarded back wages and unpaid benefits, imposed penalties under the Private Attorneys General Act of 2004 and awarded plaintiffs statutory attorneys’ fees and costs. However, the trial court found that, prior to the determination of its legal duties under the new ordinance, Cintas’s conduct was not “willful” so as to justify waiting time penalties. The Court of Appeal affirmed all of the trial court’s rulings.
I strongly suggest reading the entire article as it goes into far more detail that I can. It’s absolutely fascinating and I personally believe that this case sets incredible precedent, particularly since more and more municipalities are putting living wage ordinances into play.