Minimum wage, labor issues would impact businesses
RENO — The 79th session of the Nevada Legislature is well underway.
Some of the big issues that impact the business community include minimum wage and labor issues. Unlike the last session, the Democrats control both the Senate and Assembly whereas in 2015 the Republicans held the majorities.
The minimum wage bill is one that is creating a lot of controversy. Minimum wage is currently at $7.25 per hour if an employer offers health insurance and $8.25 if not. The proposed Assembly bill would increase the wage up to $15 an hour over the next several years by raising the minimum wage by $1.25 per year until 2022.
According to backers of the bill, it will increase productivity of workers, reduce employee turnover and provide Nevada workers with a better living wage.
However, opponents of the bill, including many business organizations, are opposing the bill due to the cost it would have on business owners, particularly to small business owners.
“It raises the entire payroll for a business,” Randi Thompson, a public and government relations specialist and owner of Randi Thompson Consulting, said.
Thompson said that the impact of the cost extends past just the wage increase.
“It puts an increase on unemployment tax, on the payroll tax, on FICA, on workers compensation, everything goes up,” she said.
She explained that the increase in cost to business owners could cause them to look for alternatives such as automation.
There is also a senate bill that proposes a $12 minimum wage. Other legislative items include equal pay for workers and earned sick leave.
“What we are concerned about is that we think that it opens up small businesses to more lawsuits,” Tray Abney, director of government relations, with The Chamber of Reno, Sparks, Northern Nevada said. “It is difficult to create jobs if they are spending money on legal fees.”
Also, product liability is an issue that will be returning this legislative session.
Thompson explained that SB161, which passed last session but was vetoed by the governor, is being brought back to the legislator. The bill dealt with product liability and protects sellers of defective products so the retailer would not be sued if the problem is caused by the manufacturer and they did not do anything to damage or alter the product.
However, Thompson was not optimistic that this bill would pass this session.
Several bills impact the entrepreneurial and start-up community.
One bill eliminates the Nevada law requiring venture capitalists and private-fund advisors to register as investment advisors. According to Doug Erwin, the vice president of entrepreneurial development at EDAWN, The bill would put Nevada more in line with federal law.
“In the entrepreneurial world, friction stalls growth and this bill would remove some of that friction,” Erwin said.
Another bill prohibits the application of non-compete agreements in the startup industry. It would also strengthen existing laws that safeguard the non-disclosure of confidential information and trade secrets.
Erwin said that he expects the bill to be a fairly contentious issue.
The property tax law reform bill is also a hot issue.
AB43 would revise the formulas used to calculate annual property tax on residential and other property. The bill would not impact caps on the annual increases of residential and commercial property taxes.
“The idea is not to increase property tax but to fix the broken system that we have,” Abney said.
While this bill has a broader impact, Abney said it is important for the business community to pay attention to this bill and other broad-based tax reforms.
“It is important to the business community because the more we ensure that those broad-based revenue sources work properly the less need governments will have for commerce tax and other business specific taxes,” Abney said.
Abney said that he is also concerned about the rolling back of the progress that they made during the last session with the new majorities.
“We just hope that the legislature represents all Nevadans and that includes business owners,” Abney said.