CARSON CITY, Nev. (Legal Newsline) – The Nevada Supreme Court on March 16 denied Western Cab's petition for extraordinary relief under the state’s Minimum Wage Amendment, which allows employers to pay lower wages to employees when they also offer them health benefits.
The Supreme Court said MWA was not preempted by the National Labor Relations Act (NLRA) because it did not supersede the power of the National Labor Relations Board (NLRB) or overstep its authority on areas that Congress left open to the free market.
The high court’s opinion stems from a lawsuit Western Cab Co. employees filed after the company began forcing its drivers to pay for their own fuel instead of deducting it from their paychecks in 2012. The employees claimed that their wages fell below the state-required minimum when the fuel costs were considered.
The MWA requires employers to pay a minimum wage rate of $7.25 if it offers employees qualifying health benefits. They must pay a minimum wage rate of $8.25 if it does offer health benefits. The law in no way forces employers to provide any benefits.
According to court records, the cab company petitioned for extraordinary relief from the high court after a district court ruled that MWA was not only unconstitutionally vague, but it was not preempted by the NLRA and the federal Employee Retirement Income Security Act of 1974 (ERISA).
The cab company argued that a person of ordinary intelligence could not understand what conduct is prohibited and the law did not clearly define the term “health benefits.” The court disagreed.
According to the opinion, the court stated the cab company had plenty of notice as to what benefits they must provide to qualify for the lower wage. Furthermore, the court found the MWA failed to promote “arbitrary or discriminatory enforcement.”