Senate Committee Approves Increase

Yesterday, the Senate Commerce, Labor and Energy Committee passed Senate Bill 106 (SB 106) by a vote of 4-3, largely along party lines. SB 106 proposes increasing the minimum wage in Nevada each year until the minimum wage reached $11.00 per hour for employees who are offered qualifying health insurance and $12.00 per hour for employees who are not. The bill now heads to the full Senate for review and a vote.

Proponents of SB 106 state that increasing the minimum wage would benefit the overall economy by giving low-wage earners more buying power. However, opponents of SB 106 note that the increase would create a burden for small businesses in Nevada, which would lead to higher prices for goods and services, and potentially job losses. Small business has created 60% of the net new job growth in recent years. Small businesses is the engine that is driving Nevada’s economic recovery. 98% of all Nevada businesses are small businesses, therefore, the impact of any increase to the minimum wage would affect business in Nevada greatly.

Additionally, as a consequence of the minimum wage increase under SB 106, the daily overtime threshold would increase to $16.50 and $18.00, respectively. That means more workers would be subject to daily overtime. Daily overtime is due when an employee in Nevada makes less than 1.5 times the minimum wage and works more than 8 hours in any workday. Therefore, an employee who makes $15.00 and works more than 8 hours in a day would be entitled to overtime compensation (at $22.50 per hour).

Democrats Consider Backup Plan

Nevertheless, Democrats in the state legislature concede that they may need to go to the ballot box to raise the minimum wage in Nevada. Governor Sandoval has stated that he does not support an increase in the minimum wage. Therefore, even if SB 106 were to pass both houses of the state legislature and make its way to the Governor’s desk, it likely would not be signed into law.

“Of course, we’d be disappointed if we weren’t able to start raising the minimum wage next year, but that’s why we’ve left open the option of pursuing a constitutional amendment,” Democratic Senate Majority Leader Aaron Ford said. “If Nevada Republicans won’t consider giving working families a raise, then Nevada voters will.”

Senate Joint Resolution 6 (SJR 6) proposes amending the Nevada Constitution to provide for one minimum wage, setting it at $9.00 per hour beginning in 2022, $9.75 in 2022, $10.50 in 2023, $11.25 in 2024 and $12 in 2025. It would also delete the equation tying the state minimum wage to the cost of living and federal rate. SJR 6 would need to pass the state legislature this year and in 2019 before going to voters in 2020.

Nevada’s current minimum wage is $8.25 per hour for employees who are not offered qualifying health insurance and $7.25 per hour for employees who are. Nevada’s existing wage, if insurance is offered, is on par with Idaho and Utah, but lags behind California ($10.50), Arizona ($10.00) and Oregon ($9.75).

Nevada Association of Employers (NAE) monitors the latest developments from the 2017 Nevada Legislative Session to ensure Nevada employers are aware of legislation that may potentially affect their business. To stay up-to-date on the latest from the Nevada legislature and NAE, join our mailing list.