Craig's Corner - Wealth Planning Insights

Friday, October 9, 2015

Nevada Judge Interprets Two-Tier Minimum Wage Structure

As a small business owner, how should I interpret the current minimum wage mandates in Nevada?

For Nevada business owners, understanding the current minimum wage directives is vital to lawful business ownership and proper compliance with employment laws. Accordingly, it is imperative to keep abreast of ongoing changes in the wage laws within the state, including the recently enacted two-tier system designed to ensure that workers in all industries are offered a fair and predictable hourly rate.

Under current laws, there are two separate minimum wage requirements, depending upon whether an employer offers workers the option of purchasing health insurance through the company. If an employer offers health insurance, minimum wage for that employee is $7.25 per hour – an amount congruent with the federal standard. If the employer does not offer health insurance, the minimum wage is increased to $8.25.

In August, 2015, a Carson City judge added two pivotal caveats to these rules. First, the judge concluded that an employer cannot count tips when asserting compliance with the minimum wage measure. In other words, an employer cannot refuse to offer health insurance, then claim to be offering his workers $8.25 per hour by including tips in the hourly rate calculation.

Second, the judge concluded that it is insufficient for an employer merely to offer health insurance; the employee must actually accept the policy before the $7.25 wage is considered lawful. Proponents of this measure point to the fact that many employers offer sub-par policies or policies with extremely high premiums that are unaffordable for the average worker. Before this recent interpretation, employers were able to offer the lowest minimum wage to employees who were simply offered a health policy, regardless of whether they could afford to take advantage of it.

The Nevada Labor Commissioner is planning to ask for a stay of these rulings to allow for the Supreme Court to weigh in.

If you have questions about compliance with state or federal wage laws, please do not hesitate to contact the Stone Law Office at 877.800.3424.

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S. Craig Stone II of Stone Law Offices, Ltd. serves clients throughout Clark County, Southern NV, Las Vegas, Henderson, Boulder City, North Las Vegas, Summerlin, Carson City, Reno, Washoe County, and Nye County. Also serving clients with asset protection nationwide.

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