In Business Las Vegas, July 20th, 2007
Confusing new minimum wage calculations will affect many more employers than the small number who pay the lowest allowable wage.
Those who pay some workers less than 1 1/2 times the
Nevada
minimum wage are affected by state overtime laws and will need to check the wage requirements.
What makes things complex is the combination of state and federal rules, which will change the minimum wage every July 1 and July 24 until 2009 — and keep employers on their toes.
"
Nevada
's minimum wage is probably a little more complicated than anyone else's," said
Michael
Tanchek, Nevada's labor commissioner
.
Two factors make the state's rules complicated.
One is that
Nevada
is among four states that calculate overtime based on an eight-hour workday rather than a 40-hour work week. The law was written when
Nevada
was one of the few states with a 24-hour service industry.
That's the issue that applies (with some exceptions) to employers paying less than 1 1/2 times the
Nevada
minimum wage.
The other factor is the two-tiered minimum wage system that was approved by
Nevada
voters. Employers pay a lower wage if they offer a qualified health insurance plan; they must pay more hourly if no insurance is available.
"As the overtime threshold increases, it will affect more and more (businesses)," said
Cara
Roberts, spokeswoman
for the Las Vegas Chamber of Commerce. "It's a constant moving target. If it doesn't apply to you today, you need to keep abreast of it. At some point it may apply to you."
The chamber recently published a detailed chart estimating minimum wage, along with a Web page that breaks down the rules in simple language. To read the explanation, visit www.lvchamber.com, click on "Chamber News" and then click on the June 20 press release titled "Six More Increases to Minimum Wage in Next Two Years."
"I think there's a lot of misinformation out there because the change was oversimplified to make it sound like the higher rate was always going be
Roberts
said.$1 more than the federal,"
In another criticism,
Roberts
said the rules give an unfair advantage to businesses with unionized workforces, and employers might have an incentive to negotiate a collective bargaining agreement. Companies with CBAs may qualify for the lower-tier minimum wage.
It's unclear how many Nevadans are paid the minimum wage. Data published by the state does not estimate this, and
Tanchek
said he could not think of an industry — outside of tipped workers — in which minimum wage was the norm.
The state has a better estimate on how many people fit into the overtime requirement category. The lowest-paid 10 percent of
Nevada
employees are paid $7.59 or less, according to the Occupational Employment and Wages reports by the Nevada Department of Employment, Training and Rehabilitation.
The lowest-paid 25 percent of workers earn $10.31 or less.
More factors, including exceptions for those under 18 years old, go into calculating what a company can pay its workers.
The federal minimum wage increases for two years.
Nevada
's minimum wage increases are based on the federal standard and cost-of-living adjustments.
The Office of the Labor Commissioner helps employers who call in, wanting to understand the laws. Visit www.laborcommissioner.com or call (702) 486-2650 for assistance.
The majority of questions have to do with how much insurance a company must provide to pay the lower-tier minimum wage,
Tanchek
said.
To qualify to pay the lower wage, an employer must offer workers and all dependents a qualified health insurance plan that costs 10 percent or less of the workers' gross taxable income.
"When you look at the actual numbers of people it affects, it's not that great, but employers still have to do the analysis and see whether or not it's going to be a problem,"
Tanchek
said. "Once they figure out where they're at, they have to make business decisions on who to hire, on how many hours they will work."
