2015 Nevada Legislative Wrap-Up: A Review of Labor and Employment Issues

Volume 14, Issue 15
July 9, 2015

As the 78th Session (2015) of the Nevada Legislature ended last month, Kamer Zucker Abbott (KZA) provides this summary of notable developments affecting employers. While the 2015 Nevada legislative session did not result in any sweeping changes for employers, there were some significant developments, both in terms of what bills and resolutions were passed and those that did not.

New and/or Amended Laws:

Criminal Records Search for Employers (Assembly Bill 47) - This new law, which became effective on May 25, 2015, establishes a criminal records service to aid employers in the State of Nevada in determining suitability of employees and applicants by conducting, for a small fee, criminal records searches of employees, prospective employees, volunteers, and prospective volunteers within the Central Repository for Nevada Records of Criminal History.

Public Employees Using Medical Marijuana (Senate Bill 62) - This new law, in part, provides discretionary authority to the State Personnel Commission to adopt regulations setting forth the circumstances in which a state employee who holds a valid registry identification card to engage in the use of medical marijuana is subject to disciplinary action by a Nevada public employer, as well as when such an employee must be referred to an employee assistance program. The State Personnel Commission's new discretionary authority related to medical marijuana use became effective on July 1, 2015.

Local Government Collective Bargaining (Senate Bill 158) - Effective on July 1, 2015, this law provides that, before a public hearing convened for a local government to consider adoption of a collective bargaining agreement, certain information must be provided to the public not less than three business days before the hearing, including a copy of the entire agreement, summaries of changes made, and summaries of fiscal impacts. This bill provides more transparency and betters the understanding of the public of short and long-term financial impacts of labor agreements.

Limitations on Wage and Benefit Recoveries from Prime Contractors (Senate Bill 223) - Effective October 1, 2015, this law revises NRS 608.150 to limit the scope of recoveries that can be obtained from a prime contractor related to wages and benefits due to an employee by a delinquent subcontractor. SB 223 clarifies that prime contractors are not liable for any penalties imposed on a delinquent subcontractor related to the nonpayment of wages and benefits, including interest, liquidated damages, attorney's fees, and costs. In addition, SB 223 requires Taft-Hartley Act (union) trust fund administrators who do not receive a benefit payment from a subcontractor within sixty days of the date on which it is deemed to be delinquent to provide specific notice to the prime contractor and subcontractor within fifteen days; if such notice is not provided, the prime contractor cannot be held liable for the subcontractor's delinquency. SB 223 also shortened the statute of limitations for bringing actions under NRS 608.150 to one year.

Independent Contractors (Senate Bill 224) - This new law, which became effective on June 2, 2015, establishes a conclusive legal presumption that a person is an independent contractor, not an employee, if the following criteria are established:

  1. The contractor must have an employer identification number or have filed an income tax return for a business or self-employment;
  2. The contractor is required to maintain a state business license, insurance, or bonding; and
  3. At least three of the following criteria are met:
    • The contractor has control over the means and manner of performance of his/her work and the results of such work;
    • The contractor maintains some control over the time the work is performed;
    • The contractor is not required to work for only one principal (with exceptions);
    • The independent contractor is free to hire employees; and
    • The contractor has a substantial investment in the capital of the business such as tools, material and equipment, licenses, or lease of work space.

The fact that a person is not conclusively presumed to be an independent contractor for failure to satisfy three or more of the criteria set forth under Item 3 above does not automatically create a presumption that the person is an employee.

SB 224 is aimed at overturning the definition of "independent contractor" adopted last year by the Nevada Supreme Court in Terry v. Sapphire/Sapphire Gentlemen's Club. There, as outlined in KZA's December 9, 2014 Employer Report, the Court adopted the "economic realities" test used under federal law to differentiate an "employee" from an "independent contractor."

Workers' Compensation Benefits (Senate Bill 231) - Beginning January 1, 2016, this law will limit the amount of a controlled substance that healthcare providers dispense to an injured employee to a fifteen day supply and revises the amount of time that an insurer has to pay a bill submitted by a healthcare provider. In addition, the law requires that an employee not receive workers' compensation whenever an injury occurs to the employee while the employee is intoxicated or under the influence of a controlled or prohibited substance, unless the employee can prove by clear and convincing evidence that his or her intoxication or being under the influence of a controlled or prohibited substance was not the proximate cause of the injury. The new law provides that an employee is "intoxicated or under the influence of a controlled or prohibited substance" for the purposes of not receiving workers' compensation whenever the employee meets or exceeds the limits for intoxication or use of a controlled or prohibited substance as set forth in NRS 484C.110, which prescribes such limits in the context of driving under the influence.

Workers' Compensation Reimbursement (Senate Bill 232) - Effective January 1, 2016, this law provides a reciprocal right to reimbursement in situations in which an insurer, organization for managed care, third-party administrator, or employer appeals an order of a hearing officer, appeals officer, or district court and the order is not stayed pending the appeal. In such situations, if the appeal is successful, the insurer, organization for managed care, third-party administrator, or employer is entitled to seek reimbursement from the injured employee's health or casualty insurer for payments made while the appeal was pending. It also raises the current lump sum award from 25% to 30% for permanent partial disability.

Local Government Collective Bargaining (Senate Bill 241) - Effective June 1, 2015, SB 241 makes substantial changes in the area of local government labor relations, including a new requirement that local government employers, with limited exceptions, not increase any compensation or monetary benefits paid to or on behalf of bargaining unit employees once a collective bargaining agreement expires and until a successor agreement becomes effective. SB 241 also imposes certain new requirements related to collective bargaining pertaining to school administrators and school teachers.

Reporting of Criminal Convictions to a Gaming Licensee Following a Background Check on an Employee (Senate Bill 409) - Effective as of June 9, 2015, SB 409 added a new provision to Nevada's gaming laws on the reporting of criminal convictions to a gaming licensee who has requested such report as part of its internal investigation. Based on SB 409, gaming law now prohibits a report of criminal proceedings, or other adverse information, excluding a record of a conviction of a crime that is older than seven years, thereby removing for gaming licensees, the current prohibition against disclosing a record of a criminal conviction older than seven years.

Tax Credit for Employers Who Match Employee Contribution to Nevada College Savings Plans (Senate Bill 412) - Beginning January 1, 2016, where an employer matches an employee's contribution to a Nevada Higher Education Prepaid Tuition Program and the Nevada College Savings Program, the employer is eligible for a credit against the excise tax imposed pursuant to NRS 363A.130.

Arbitration Provisions (Senate Bill 442) - This law, effective June 4, 2015, addresses two main issues in private arbitrations. First, the statute prohibits certain arbitrators from consolidating separate arbitral proceedings or other claims unless all parties expressly agree to such consolidation. Second, SB 442 requires a court to remove an arbitrator who fails to disclose any facts that a reasonable person would consider likely to affect the impartiality of the arbitrator, if an award has not yet been made.

Law Enforcement Employees Use of Medical Marijuana (Senate Bill 447) - Effective as of July 1, 2015, NRS 453A.800 is amended to provide that law enforcement agencies are not prohibited from adopting policies or procedures precluding employees from engaging in the medical use of marijuana. The term "law enforcement agency" includes: (a) the Office of the Attorney General, the office of a district attorney within Nevada, the Nevada Gaming Control Board and any attorney, investigator, special investigator or employee who is acting in his or her professional or occupational capacity for such an office or the Nevada Gaming Control Board; as well as (b) any other law enforcement agency within Nevada and any peace officer or employee who is acting in his or her professional or occupational capacity for such an agency.

Bills Not Passed:

Damages for Employees Injured by Unlawful Employment Practices (Senate Bill 180) - This bill would have mandated that courts award plaintiffs not only the damages and relief already available for violations of NRS 613.310 to NRS 613.435, but also the costs and fees associated with hiring an attorney to file suit against an employer that engaged in unlawful employment practices.

Daily Overtime Provisions (Senate Bill 193) - This bill would have revised the existing daily overtime laws for hourly employees who work more than eight hours a day, but less than forty hours a week, by removing the daily overtime requirement.

Paid Sick Leave to Employees (Senate Bill 259) - This bill would have required private employers to provide at least one hour of sick leave for every thirty hours an employee worked beginning on the 90th day of employment. This sick pay would have carried over up to forty-eight hours per year, but the employer would not have been required to pay out any unused sick leave at termination.

Determining Minimum Wage (Senate Joint Resolution 6) - This resolution attempted to amend the Nevada Constitution to define what constitutes an acceptable level of health care benefits entitling employers to pay the lower of Nevada's two minimum wage rates. Currently, in order for an employer to pay the lower state minimum wage rate, it must offer health insurance to an employee and the employee's dependents at a cost that is no greater than ten percent of an employee's gross taxable wages. This resolution would have amended the cost definition to include an alternative of ten percent of the federal poverty level for a family of four, and apply whichever standard was greater.

Increasing Minimum Wage (Senate Joint Resolution 8) - This resolution proposed to change the minimum wage from $7.25 an hour if healthcare coverage is provided by the employer and $8.25 an hour if healthcare coverage is not provided to $15.00 an hour if healthcare coverage is provided by the employer and $16.00 an hour if healthcare coverage is not provided.

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.

KZA 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.