Is the Living Wage Dead in Detroit? The Role of Stare Decisis, Home Rule, and Policy Preferences in the Michigan Supreme Court

Does a municipality have the authority to enact and enforce a min-imum wage law for employers contracting with the city? This question, rather than being a simple policy question to be decided by local authorities, can implicate state constitutional law and stare decisis concerns. Living wage ordinances establish compensation for employees that enables them to earn at or above the poverty line. A recent trial court case in Michigan struck down the implementation of a living wage ordinance in Detroit. The trial court struck down the ordinance based on a case decided by the Michigan Supreme Court in 1923, during a time when state and federal authorities could not regulate wage rates or the number of hours an employee worked. In this Note, the author analyzes whether the Michigan Supreme Court should uphold the trial court’s decision. He begins by providing a brief overview of the living wage movement, including arguments both in support of and in opposition to such ordinances. The propriety of enacting a living wage ordinance is a contested and politicized issue, which may play an important role in the Michigan Supreme Court’s decision.The author next examines the impact of a state’s constitution on whether municipalities even have the ability to pass such ordinances. Many state constitutions give municipalities some form of home rule power, which permits a municipality to implement unique ordinances based on their policy preferences. There are two types of home rule power: imperio and legislative. If a municipality has imperio home rule power, it is capable of enacting ordinances governing matters of local concern, and these or-dinances are immune from state legislation. In an imperio system, municipalities are unable to ascertain the extent of their control over matters that are not clearly matters of local concern. Legislative home rule provides municipalities the authority to regulate all matters, unless the state legislature has taken that power away. The legislative system provides municipalities confidence in their ability to regulate in the absence of the state’s veto of such power. There is not a clear dichotomy between the two systems; instead, they fall along a spectrum. Over the years, the Michigan legislature has increased the authority given to municipalities, and it is with this evolution that the author argues Detroit’s ability to enact a living wage ordinance.Despite the authority that the Michigan legislature has given to munici-palities, the Michigan trial court struck down the living wage ordinance based on precedent and the principle of stare decisis. Nonetheless, the author argues that the Michigan Supreme Court should not follow prece-dent based on its own standard for when it is appropriate to overrule pri-or cases. When presented with the argument that a case should be over-turned, the Michigan Supreme Court will consider four factors: whether the earlier case was wrongly decided, whether the decision defies practi-cal workability, whether changes in the law or facts no longer justify the earlier case, and whether reliance interests would create an undue hard-ship. Finding that all of these factors are present, the author concludes that the principle of stare decisis and the earlier Michigan Supreme Court case should not preclude a municipality’s initiative of enacting a living wage ordinance.In conclusion, the author finds that the intersection of policy considera-tions, home rule power, and stare decisis does not necessarily lead to the affirmation of the trial court’s ruling. The Supreme Court of the United States has upheld the power of the federal legislature to regulate wage levels and working conditions and the Michigan legislature has amended the state constitution, two important factors in the author’s analysis. In addition to recommending that the Michigan Supreme Court uphold the ability of municipalities to enact living wage ordinances, the author pro-vides advice on how to overcome the obstacles supporters of living wage ordinances face.

The full text of this Note is available to download as a PDF.