Minimum wage can’t be raised by legislative statute

(Brett Sutton) – Senate Bill 193 was passed in the Nevada Senate on April 3 and now awaits assembly approval. The bill would bring Nevada in line with most other states by requiring payment of overtime only when an employee works more than forty hours in a work week. However, another portion of the bill aims to raise Nevada’s minimum wage from $8.25 to $9.00 per hour for employers that do not offer a qualifying health insurance plan.

The economic impact of raising the minimum wage is rightfully the subject of much discussion given the importance of the topic, but an immediate and fundamental question has been largely ignored: May the Legislature raise Nevada’s constitutionally-provided minimum wage by mere statute?

The Nevada minimum wage is set forth in the state constitution. That constitutional scheme expressly provides for only two methods by which the minimum wage may be increased. Because the constitution specifically addresses how and when the state minimum wage may be raised, any other method of increase is constitutionally impermissible.

This conclusion necessarily flows from the Nevada Supreme Court’s decision in “Thomas v. Nevada Yellow Cab Corp.” In that case, the court based its ruling on a common principle of constitutional interpretation: Where the constitution specifically lists certain things, this equates to an exclusion of other things beyond that list.

For example, the Nevada Yellow Cab case centered on a phrase in the constitution’s minimum wage provision that requires the minimum wage to be paid to all employees except where an employee is under 18 and meets specific criteria.

The plaintiffs — a group of taxicab drivers — argued that a statute exempting cab drivers from minimum wage protections was unconstitutional. The court agreed, holding that because the constitution includes a specific exemption to the requirement to pay minimum wage, all other exemptions are implicitly excluded and any exemption created by statute is unconstitutional.

The same reasoning applies to SB193. The constitution expressly provides for two ways to increase the minimum wage: 1) based on an increase to the federal minimum wage; or 2) based on an increase to the Consumer Price Index. All other means of raising Nevada’s minimum wage are therefore unconstitutional.

In adopting the constitution’s minimum wage provision, the people of Nevada voted for a comprehensive scheme that insulates the minimum wage from the whims of party politics in the legislature. As the Nevada Supreme Court recognized in its Nevada Yellow Cab decision, “a state legislature has not the power to enact any law conflicting with the . . . constitution of its particular State.”

The assembly should remove the language in SB193 that purports to increase the state minimum wage, in recognition that the minimum wage may only be modified as provided in the constitution.

A version of this column was originally published in Reno Gazette-Journal.

Brett Sutton is Vice-Chairman of Nevada Restaurant Association.