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The Nevada Supreme Court Examines Coverage of State Prevailing Wage Law

Volume 1, Issue 6
April 8, 2002

State high court determines that drivers who haul materials to public construction sites could be covered by prevailing wage provisions.

In a recent decision that will impact Nevada employers engaged in the construction industry, the Nevada Supreme Court determined that drivers who haul materials to state public works sites may in fact be entitled to state prevailing wages, even though the law itself states that it applies to employees “at the site of work”. Granite Construction Company was a general contractor engaged in three separate public works projects for the resurfacing of state highways. As part of its contract, Granite employed drivers to transport raw materials from state “borrow pits” located away from the construction sites. Although Granite paid the prevailing wage to its employees at the pits, it did not pay the prevailing wage to the truck drivers. When the Nevada Department of Transportation learned of this, it withheld payment of approximately $225,000.00 in contract payments. After an investigation, the Labor Commissioner advised Granite to pay the truck drivers the prevailing wage.

Before the Nevada Supreme Court, Granite argued that the drivers were not subject to state prevailing wage statutes since state law dictated that an employee must be employed “at the site of the work”. However, the court noted that geographic proximity to the site of the public works project was only one factor that the state legislators intended for the determination of whether an employee was covered by the prevailing wage act. Also important is whether an employee’s particular duties are necessary for the execution of the contracts awarded to the employer. Because the materials which Granite’s drivers were hauling were integral in the completion of the highway construction project, the drivers were entitled to receive prevailing wages.

From this case, those employers who engage in public works contracts should recognize that the state prevailing wage statute will be interpreted more broadly than its federal counterpart and will encompass more employees. Under the federal prevailing wage statute, an employee must be employed directly at a public works site, or in very close proximity, in order to be entitled to a prevailing wage. Under the state statute, however, an employee’s function will often be examined to determine whether it is necessary to the execution of the public works contract.

State of Nevada v. Granite Construction Co. , 118 Nev. Adv. Op. No. 9, (Feb. 13, 2002).

Employer Report articles are for general information only; they are not intended and should not be construed to be legal advice. Reading or replying to such articles does not establish an attorney-client relationship. In addition, because the subject matters and applicable laws discussed in Employer Report articles are often in a state of change and not always applicable to every type of business entity or organization, readers should consult with counsel before making decisions based on the same.