ST. PAUL - A paid sick leave mandate instituted by the city of Minneapolis has survived a legal challenge, with some bruises.

The Minnesota Court of Appeals ruled Monday, Sept. 18, that the city cannot require employers located outside the city limits to provide employees with paid sick days.

The court also ruled, however, that the city may continue to impose paid sick leave on Minneapolis-based businesses.

The Court of Appeals decision affirms a Hennepin County District Court decision from January.

The Minnesota Chamber of Commerce had fought the city's paid sick leave rules, calling them at conflict with state law. In a written statement, Chamber President Doug Loon described the latest ruling as a mixed victory for both sides.

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Loon said his organization will appeal the decision to the Minnesota Supreme Court.

"We're pleased that the court prevented Minneapolis from imposing its ordinance on businesses that don't even have any physical presence in the city," Loon said. "At the same time, we're disappointed that the Court of Appeals allowed the underlying Minneapolis ordinance to stand."

The Minneapolis ordinance, which applies to companies with six or more employees, took effect July 1.

St. Paul officials have been tracking the legal case closely.

Also effective July 1 for employers with 24 or more employees, Minnesota's capital city passed an even more aggressive paid sick leave mandate that applies to companies of all size. Small businesses have until Jan. 1, 2018, to implement the details.

To block mandates in both cities, the Republican-led House and Senate passed a preemption measure this year, but DFL Gov. Mark Dayton vetoed the bill.

Another legislative battle over the measure is possible in 2018.