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2013 Year in Review: Legislative Edition

Volume 12, Issue 10
December 20, 2013

As we near the end of 2013, Kamer Zucker Abbott (KZA) provides this summary of notable legislative developments affecting employers. While the 2013 Nevada legislative session did not bring any sweeping changes for employers, there were some significant developments, both in terms of what was passed and vetoed.

New and/or Amended Laws:

Medical Marijuana (Senate Bill 374) - While Nevada law has provided for the recognition of medical marijuana use since 2001, the law also provided that employers did not need to accommodate the use of medical marijuana among its employees. Now, however, effective April 1, 2014, Nevada employers will have an obligation to make reasonable accommodations for the medical needs of their employees who engage in the medical use of marijuana, provided the employee holds a valid registry identification card. Importantly, this duty to accommodate does not include require an employer to modify the employee's job or working conditions which are based on the reasonable business purposes of the employer. Also, the duty to accommodate does not include allowing the employee to engage in the medical use of marijuana in the workplace. Finally, an employer is not obligated to make a reasonable accommodation where such accommodation: (1) would pose a threat of harm or danger to persons or property or impose an undue hardship on the employer, or (2) would prohibit the employee from fulfilling any of his job responsibilities. Thus, these new legislative requirements now add yet another layer to an employer's obligations to reasonably accommodate disabled or impaired employees.

Use of Credit Information (Senate Bill 127) - Effective October 1, 2013, employers in the State of Nevada cannot condition employment of either an employee or an applicant based on the results of the individual's consumer credit report or other credit information. Similarly, an employer may not take negative employment action against an individual for refusing to furnish such credit information. Significantly, however, there are certain exceptions to these prohibitions. In particular, an employer may request and consider a credit report for employment purposes if the employer is specifically required or authorized to request such information or has reason to believe that the individual has engaged in activity which constitutes a violation of state or federal law. In addition, employers may request and consider credit information where the information is "reasonably related" to the employment position for which the individual is being considered. The new law sets forth 8 types of job duties for which credit information will be deemed reasonably related:

  • Care, custody or handling of money, accounts or other assets
  • Access to trade secrets and other proprietary or confidential information
  • Managerial or supervisory responsibility
  • Direct exercise of law enforcement authority as an employee of such agency
  • Care, custody or handling of personal information of another person
  • Access to the personal financial information of another person
  • Employment in a financial institution chartered under either federal or state law
  • Employment in a licensed gaming establishment

An employer who violates this new law may be subject to a civil action brought by the affected individual or the Labor Commissioner, who may also impose an administrative penalty of up to $9,000 per violation.

Disclosure of Social Media Information (Assembly Bill 181) - This new law, effective October 1, 2013, prohibits employers from requesting or requiring that employees or prospective employees disclose the user name, password or other access information to the individual's personal social media account. Similarly, employers may not condition employment or take negative employment action against an individual for refusing to provide such information or access to his personal social media account. This law specifically addresses prohibited disclosures regarding personal social media accounts. As a result, an employer can still require an employee's disclosure of access information to an account or service maintained on the employer's own internal computer or information system.

Arbitration (Assembly Bill 326) - For those employers who use arbitration as a means of dispute resolution with their employees, as of October 1, 2013, this new law requires that an arbitration agreement include a specific authorization of the arbitration provision by the individual. In the absence of a specific authorization of that provision, the arbitration agreement will be considered void and therefore, unenforceable. This new law carves out an express exception from these requirements for collective bargaining agreements.

Repeal of Mini-COBRA (Assembly Bill 425) - Federal COBRA law which provides continuation of health care insurance rights to certain employees applies only to those employers with 20 or more employees. For that reason, many states - including Nevada - had enacted their own "mini-COBRA" laws to extend the same rights to individuals working for smaller employers. Previously, Nevada's mini-COBRA law applied to employers with 2 to 19 employees. As part of an overhaul of the Nevada Insurance Code to conform to the federal Affordable Care Act (aka "Obamacare"), the 2013 Nevada Legislature repealed Nevada's mini-COBRA law in its entirety, effective January 1, 2014. This repeal is based on the coverage options that will become available at the beginning of 2014 to employees and small employers through Nevada's health insurance exchange, the Silver State Health Insurance Exchange.

Fraudulently-Obtained Unemployment Benefits (Senate Bill 36) - This amendment, effective June 2, 2013, permits the Employment Security Division of the Nevada Department of Employment, Training and Rehabilitation (DETR) to provide an employer with a notice to withhold wages of an individual who fraudulently obtained unemployment benefits, once the Division has obtained a judgment against the individual. The notice to withhold is intended as an additional collection mechanism for the repayment of benefits, and carries with it certain penalties to be imposed on an employer who does not comply, similar to those instances where a wage garnishment applies.

Military Leave for Public Employees (Assembly Bill 364) - Effective October 1, 2013, public officers and employees who are employed by the State of Nevada, or an agency or political subdivision thereof, are entitled to a maximum period of 39 working days, within a calendar year, in which they must be relieved from their job duties - without loss of compensation - to serve their orders. This amendment increases the period of time from 15 to 39 working days, provided that the public employee's regular work schedule includes either Saturday or Sunday. If the employee's work schedule does not include Saturday or Sunday, the time off without loss of pay remains at 15 working days.

Significant Veto (Senate Bill 180)

For employers, the most significant defeat of this year's legislative session was the veto of Senate Bill 180, which would have greatly increased the remedies available to employees who assert claims for unlawful employment practices. According to the bill, the proposed law would have empowered state courts to award a successful plaintiff damages, lost wages and benefits, and costs and attorney's fees, in addition to any other legal or equitable relief, consistent with the remedies available under Title VII of the Civil Rights Act of 1964. As many employers who have faced employment litigation know, federal courts are usually a more employer-friendly forum than our state courts. Many plaintiffs' attorneys also recognize this fact, and proceed to file litigation in state court, even when federal employment claims are being asserted. Federal laws, such as Title VII, provide more extensive remedies for employment plaintiffs, including attorney's fees and costs. By contrast, Nevada state law generally limits remedies to lost wages and restricts those instances where attorney's fees and costs can be recovered. For that reason, many employment lawsuits seek recovery under both federal and state law.

Had Senate Bill 180 become law, there would have been a significant rise in employment litigation claims premised solely under Nevada law - so as to avoid the possible removal of a case to federal court (which has jurisdiction of federally-based claims). For now, therefore, there still remains a disincentive from a remedies standpoint for employees and former employees to assert solely state law employment claims. This issue is far from settled, and will likely resurface during the next legislative session in 2015.

If you have any questions or would like further information about any of these legislative developments, please do not hesitate to call the KZA attorney with whom you regularly work or call our office at (702) 259-8640.

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.