Restaurants Fight Nevada|Minimum Wage Law

     LAS VEGAS (CN) – Five restaurant chains, including Landry’s and Bubba Gump’s, sued Nevada, claiming its minimum wage law and health care benefits regulations are unconstitutional.
     Lead plaintiff Landry’s claims the laws and regulations are pre-empted by the U.S. Employee Retirement Income Security Act of 1974 (ERISA), and also violate the Commerce Clause, the 14th Amendment and the Nevada Constitution.
     Nevada voters in 2004 and again in 2006 approved a ballot initiative that amended the Nevada Constitution and created a two-tiered wage system based on the types of health benefits provided by employers.
     This “went far beyond simply raising the minimum wage and altering the manner in which the minimum wage would be calculated,” Landry’s says in the June 19 federal lawsuit.
     Under Nevada law, if an employer provides health benefits equal in value to no more than 10 percent of an employee’s gross taxable income, the employer can pay a lower minimum wage.
     Nevada’s minimum wage is $8.25 per hour and $7.25 per hour when qualifying health benefits are provided.
     The law provides “virtually no guidance regarding ‘health benefits'” and does not authorize the Nevada labor commissioner to regulate or enforce the law, Landry’s claims.
     It claims the law provides only that the governor or governor-designated state agency on April 1 each year will publish adjusted minimum wage rates.
     “Beyond announcing and publishing the new rates, the minimum wage amendment does not authorize the governor, labor commissioner … to establish or enforce health benefits regulations,” but the labor commissioner has done so, Landry’s says.
     The labor commissioner “adopted a regulation that dictates the type of health care an employer must offer to ‘qualify to pay an employee’ the lower tier minimum wage rate,” and state law “purports to establish ‘qualified health insurance’ a concept without basis in the minimum wage amendment,” Landry’s says.
     It also claims that ERISA preempts state law, with the goal of providing uniform regulation of employee benefits.
     “State-imposed regulation of … employee benefits conflicts with ERISA’s goal of establishing uniform, nationwide regulation of employee benefit plans,” and Nevada “radically impacted and altered health benefits offered by Nevada’s private employers,” according to the complaint.
     The businesses seek declaratory judgment that Nevada’s minimum wage law and health benefits regulations are unconstitutional and preempted by ERISA, and an injunction preventing their enforcement.
     The plaintiffs are Landry’s, Bubba Gump Shrimp, Nevada Restaurant Services dba Dotty’s Gaming and Spirits, Laughlin River Lodge and Hoover Dam Lodge.
     Plaintiff’s attorney Elayna Youchah with the Jackson Lewis law firm and was not immediately available for comment Monday.
     The 2006 minimum wage amendment is now Article XV, Section 16 of the state constitution.
     The health care regulations are Nevada Administrative Code 608.100 through 608.108.

%d bloggers like this: