Minimum wage increase may affect when employees get overtime

As most employers are aware, Nevada has a two-tier minimum wage system, depending on whether the employer offers qualifying health benefits. Following Assembly Bill 456 (passed by the Nevada Legislature in 2019), each of those minimum wage levels will increase on July 1 of every year until 2024.

That means that, as of July 1, 2022, the minimum wage rate increased to $9.50 (up from $8.75) per hour if the employee is offered qualifying health benefits and $10.50 (up from $9.75) per hour if the employee is not.

Check to confirm whether changes affect your employees

At first glance, this may not seem like earth-shattering news. After all, if your employees are earning $15 per hour, then you don’t need to make any changes, right? Not so fast. Not only must employers track minimum wage increases to ensure they aren’t paying below-minimum wages, but they must evaluate whether the change to the minimum wage rate alters when employees must be paid overtime (not just how much they must be paid for these overtime hours).

In Nevada, all non-exempt employees are entitled to weekly overtime pay (meaning that they are entitled to be paid 1½ times their regular wage rate for all hours in excess of 40 per week). But employees whose regular wage rate is less than 1½ times the minimum wage rate are also entitled to daily overtime (meaning that they are entitled to be paid 1½ times their regular wage rate for all hours worked in excess of 8 hours per workday).