LAS VEGAS (CN) – A federal judge dismissed with prejudice three of four claims in a class action against a Wendy’s franchise whose workers accuse it of minimum wage violations.
Workers said in a May 2014 class action that Wendy’s paid less than minimum wage by claiming that substandard health insurance benefits enabled it to pay $7.50 to 7.75 per hour instead of the Nevada minimum wage of $8.25.
Many class members were parents raising young children. In an amended complaint, the workers accused Wendy’s of violating three sections of the Nevada Constitution and a state wage law.
Wendy’s sought dismissal, saying the workers did not state an actionable claim.
U.S. District Judge Gloria M. Navarro on Wednesday agreed with Wendy’s on three of the four claims, and dismissed them with prejudice.
But the state’s Minimum Wage Amendment explicitly provides for a private action against an employer, Navarro said, in refusing to dismiss that element.
Wendy’s of Las Vegas owns 31 franchise and non-franchise fast-food restaurants in Clark County.
State voters in 2006 amended the Nevada Constitution to establish a minimum wage of $8.25 per hour for employers who do not provide qualifying health insurance benefits. The minimum wage is $7.25 per hour for those who do.
The plaintiffs claim that Wendy’s of Las Vegas falsely claims the health-insurance benefits underwritten by Aetna comply with the state law defining acceptable health insurance benefits to qualify for the lower state minimum wage. They say the amount they have to spend on health insurance premiums exceeds what state law allows.
The workers say their health insurance premiums are much higher than the state’s qualifying threshold and do not provide coverage for deductible health care costs.
The Nevada Constitution allows employers to qualify for the reduced minimum wage only when the cost of premiums for health insurance benefits equals no more than 10 percent of workers’ annual gross taxable income. The benefits also must pay for health care costs that employees can deduct on their federal income tax returns.
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