Effective July 1, 2024, Nevada’s two-tier minimum wage will no longer exist as a result of Ballot Question 2’s passing on November 8, 2022.
By way of background, in 2006, Nevada voters approved a two-tier minimum wage system applicable to employees subject to minimum wage requirements. Since then, Nevada’s minimum wage has increased over time. As of July 1, 2022, the minimum wage is $9.50/hour for employees who are provided qualifying health benefits and $10.50/hour for employees who are not provided qualifying health benefits. Nevada Assembly Bill 456, which passed in 2019, mandated that the applicable minimum wage rates rise gradually until 2024 when they would reach $11/hour and $12/hour for the respective employee tiers.
As a result of Ballot 2’s passing, effective July 1, 2024, the Nevada state constitution was amended to increase minimum wage for all Nevada workers who are not exempt from minimum wage requirements to $12/hour (thus, eliminating the prior two-tier minimum wage approach). The ballot passing also removed the existing adjustments to the minimum wage based on annual inflation and enabled the Nevada Legislature to pass a minimum wage higher than the constitutionally required $12 per hour. The minimum wage is also subject to increase above $12/hour threshold based on applicable increases in the federal minimum wage.
Employers should take note of this development as it will also affect the threshold level for non-payment of daily overtime. More specifically, one of the most commonly used exemptions from Nevada’s daily (but not weekly) overtime requirements is the statutory provision allowing employers who pay at least 1.5 times the applicable minimum wage to avoid paying daily overtime. Once the minimum wage rises to $12/hour for all non-exempt employees, employees who make less than $18/hour would generally be entitled to daily overtime (subject to other applicable exemptions). Employers should review their current pay practices and plan in advance for the upcoming Nevada minimum wage law changes.