2021 Laws for Nevada Employers
First and foremost, if you are an employer in Nevada, you should belong to the Nevada Association of Employers (NAE). They offer their members a ton of resources, including webinars, sample policies, and – most valuable – a member hotline for those can’t-wait questions.
What follows is a digest of an NAE seminar I attended recently, which aptly summarized employer-focused bills. I testified on several during the 2021 Nevada Legislative Session as the 2021 Chair of the Vegas Chamber Board of Trustees. Some of these laws will seem (and unarguably are) onerous for employers. If you think they’re bad as passed, you should have seen them when they were first introduced! Keep in mind our legislature only meets every two years and only for 120 days at a time (excepting special sessions). That means a lot of sloppy language gets crammed through and we have to live with problems that weren’t foreseen during the session until the next session rolls around.
This is why it’s crucial to get involved in the legislative process. Legislators need to hear from us business owners – their constituents, the people who fund their campaigns and vote for them. If you want to plug right into that process, become a Chamber Advocate. It’s a Vegas Chamber program that is somehow described as my brainchild, one that helps business owners learn more about how our legislative process works and ensures our concerns are not simply dismissed. Our voices matter and if we don’t make ourselves heard, we can’t complain when these laws make it harder to do business.
<steps off soapbox>
Okay, here goes. You might want to pour yourself a stiff drink.
SB 327: Race Discrimination (the “Crown Act”); updates NRS 613
Prohibits discrimination based on hairstyles, including natural hairstyles, afros, bantu knots, curls, braids, locks, and twists. Protection does not apply if the hairstyle poses a health or safety issue as set forth in federal or state law. Applies to apprentices, students, and state employees. Check and update your handbooks!
SB 107: Statute of Limitations on Wrongful Termination Claims
This brings Nevada law into line with federal law which provides a 2-year statute of limitations on wrongful termination claims. Also tolls the statute of limitations (pauses it) from the date a complaint is filed with an administrative agency until 93 days AFTER the conclusion of those proceedings. So, plan to keep personnel files including discipline leading up to termination for a bare minimum of 2 years and probably much longer.
AB 60: Settlement Agreements
The vast majority of lawsuits are settled out of court with written settlement agreements. This law declares any provision in a settlement agreement to be void and unenforceable if it expressly prohibits a party from testifying under subpoena regarding a criminal offense, sexual harassment, acts of discrimination, or acts of retaliation.
Restrictive Covenants
As many of you know, noncompetes are unenforceable under California law, and Nevada law often copies California’s homework. We are marching directly toward declaring noncompetes to be unenforceable here in Nevada. Heck, we may not have a choice as President Biden recently called for a federal prohibition on noncompetes. For now, let’s explore what’s currently enforceable.
As a general rule, noncompetes must be reasonable in both geographic scope and duration. Under NRS 613.195, a noncompete that’s otherwise reasonable will be unenforceable if it’s not supported by adequate consideration, imposes a restraint on the employee greater than what’s necessary to protect the employer, or places an undue hardship on the employee. Also, an employee cannot be prohibited from providing services to a former customer if the employee did not solicit that customer, if the customer chose to leave, provided the employee is adhering to the geographic scope and duration limitations and those are also reasonable.
Let’s talk consideration. Though Nevada case law suggests that continued employment is sufficient consideration for these types of covenants, judges are more often seeking additional consideration to justify enforcing a noncompete.
For years we have discouraged our clients from seeking noncompetes in anticipation of this very development. These days, just assume that by the time your noncompete makes it to litigation, it will be unenforceable.
This law does not prohibit the use of confidentiality and non-solicitation agreements, which can be used to keep former employees from poaching your customers or their former co-workers.
Finally, with AB 47, noncompetes are unenforceable against hourly employees. So, there’s that.
Oh, and if you, as an employer, sue to enforce a noncompete and lose, the court SHALL award fees and costs to the employee. So, just don’t use noncompetes. M’kay?
Minimum Wage Increases:
Effective July 1, 2019: $7.25/$8.25 per hour worked
Effective July 1, 2020: $8.00/$9.00 per hour worked
Effective July 1, 2021: $8.75/$9.75 per hour worked
Effective July 1, 2022: $9.50/$10.50 per hour worked
Effective July 1, 2023: $10.25/$11.25 per hour worked
Effective July 1, 2024: $11.00/$12.00 per hour worked
What gives with the dollar difference? If you offer health benefits, you can pay the lower hourly rate. If you do offer them, and the employee declines, make sure you get that declination in writing, otherwise you could get into trouble and be liable to pay that employee not only back pay but penalties and interest. Part time employees must be paid the higher hourly wage.
Keep in mind there is a proposed constitutional amendment that, if approved by voters, would eliminate the tiered system and set across-the-board minimum wage at $12/hour starting July 1, 2024. It’s also possible the legislature could approve an even higher minimum wage.
Regarding overtime, employees making less than 1.5x the minimum wage are eligible for daily overtime. Right now that means $13.13 with health benefits, $14.63 without. If you’re looking to pay the lower minimum wage, be aware that the qualifying health plan has to be “of a value greater than or equal to the wage of an additional dollar per hour.” So, just pay the higher minimum wage to save yourself a little bit of heartache.
SB 293: Wage History
Employers are now prohibited from seeking the wage or salary history of any applicant, or relying on any such history in determining whether to hire or how much to pay. You also can’t refuse to interview, hire, promote, or employ an applicant or discriminate or retaliate against them if they refuse to provide their wage or salary history. You ARE permitted to ask an applicant their wage and salary expectations for the position. Make sure you modify your job applications accordingly.
On the flip side, employERs are required to provide the wage or salary range for the position to an applicant who has completed an interview or to any employee who has applied for a promotion or transfer, interviewed for that transfer, and has requested the salary range for that transfer.
It’s often better to include the salary range with your job postings to reduce the time you spend with candidates who want more than what you’re paying. If you’re unsure how to set your salary range, the Bureau of Labor Statistics has some resources. Spend some time setting those salary ranges for existing positions within your company so you are ready to fulfill your obligations.
Also, penalties for violations are administered by the Labor Commissioner and can top out at $5,000 per violation and costs of proceedings, including investigative costs AND attorneys’ fees. Eek.
AB 190: Kin Care
IF you provide paid or unpaid sick leave, then you must allow an employee to use such leave to assist an immediate family member with an issue for which the employee could take leave. “Immediate family” is defined as: child, foster child, spouse, domestic partner, sibling, parent, parent-in-law, grandchild, grandparent, stepparent, or someone of whom the employee is legal guardian. As an employer, you may limit the amount of sick leave used for kin care within six months, but you cannot deny use of accrued sick leave. As this one is somewhat ambiguous, we anticipate the Labor Commissioner will offer guidance as complaints roll in.
Also, there is a mandatory poster for this one. Head to the Labor Commissioner’s website to get yours.
SB 209: Paid Leave for Vaccination
Employers with 50+ employees must provide paid leave for employees to get the COVID-19 vaccination – 2 consecutive hours for each dose of the vaccine. Employees are required to provide at least 12 hours of notice prior to taking the leave. Employers must maintain the record for at least 1 year. Yes, you can request proof of the appointment or proof of the vaccination. Despite all the protestations, doing so is NOT a HIPAA violation. This one requires a poster, too.
Additionally, you may not deny the employee the requested leave, nor require the employee to find a replacement worker. If you provide an on-site vaccination clinic, where your employees may be vaccinated during regular working hours, you need not offer this leave.
This bill also revises NRS 608.0197 regarding Paid Leave. Employers must allow use of paid leave for: treatment of a mental or physical illness, injury, or medical condition; receiving a medical diagnoses or medical care; receiving or participating in preventative care; or addressing other personal needs related to the health of the employee. That last one is a bit vague, but some solace is that this applies only to employers of 50 or more.
SB 386: “Right to Return”, effective July 1, 2021
<sigh> I testified on this one several times and it never seemed to get much better until a last minute “30 employees or more” limitation was added. This bill was originally intended to prevent large resort properties, as they reopen, from offering positions to newbies at lower rates instead of veterans who’d climbed the ladder and commanded higher pay. The administrative burdens the law featured would have proved onerous for smaller businesses. The employer must provide any employee who worked for you at least six months from March 12, 2019-March 12, 2020, and was laid off during that period, written notice of their layoff in person or via mail and if possible phone, text, and email. Notices must be provided at time of layoff or no later than 20 days after the July 1, 2021 effective date; provided in Spanish, English, or any other language spoken by not less than 10% of the employer’s workforce; must contain a summary of the right to return under the act; and include contact information for the designated employer representative to receive E-MAILED notice of a violation (more on the all caps later).
This law only applies to a “Covered Enterprise” which includes an airport hospitality operation, an airport service provider, a casino, event center, or a hotel located in a county whose population is 100,000 or more. “Casino” includes any tenants within that casino.
These records must be maintained for 2 years following the notice of offer to return.
In addition to the 30-employee minimum, the lobbyists representing employers *cough* NAE and Vegas Chamber *cough* managed to add a notice and opportunity to cure. So, if an employee feels that their position was offered to someone else in violation of this law, that employee must first provide the employer with written notice (acceptable via email – yikes) of the alleged violation. The employer then has 15 days to cure. If violation is proven, the employee is entitled to reinstatement, front pay, and back pay. The Labor Commissioner can also levy fines of $100 per employee, and damages of $100 per day of violation which accrue until the violation is cured. And if this goes to court, the court awards attorney fees to the prevailing plaintiff. Yep, to the prevailing PLAINTIFF (read: employee).
The whole “send notice of violation via email” thing makes me sweat. Very few contracts permit formal notice to be sent via email because it’s nearly impossible to confirm receipt and emails get lost all the time to spam, bouncebacks, typos, and are incredibly easy to fabricate. There is a ton of room for shenanigans here, so if you are not a Covered Enterprise and/or have fewer than 30 employees, you can sleep slightly easier.
I strongly believe these types of regulations can make any business owner think twice about growing your company. That said, you should avail yourself of the resources that are available. The NAE is especially focused on helping you navigate the ever-changing state and federal laws pertaining to employees and keep you out of trouble. The membership is well worth it. To learn more, contact Amy Matthews.