Las Vegas Sun

May 26, 2022

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Governor vetoes second bill on classification of workers

CARSON CITY – Gov. Brian Sandoval has vetoed a second bill aimed at stopping employers from misclassifying workers to avoid paying more benefits.

Sandoval said the current system is adequate to ensure that businesses don't classify their workers as independent contractors to pay minimum wage and avoid contributing to unemployment and workers’ compensation insurance.

But Sen. Mike Schneider, D-Las Vegas, says Sandoval “doesn’t know what’s going on in the big city.” He said “the governor’s philosophy is the free market will take care of it, but the free market is cheating.”

Schneider said neither the governor nor his staff contacted him as chairman of the Senate Committee on Commerce, Labor and Energy, which processed the bill and held hours of hearings.

Senate Bill 208 would have required five state agencies to share information related to suspected employee misclassification and create a task force to evaluate what is happening. Sandoval said current efforts by the state are adequate and agencies have the tools to enforce the law.

Schneider said the state doesn’t have the manpower to deal with the issue. Employers are classifying workers as independent contractors, paying minimum wage and not paying into the unemployment program or the workers' compensation insurance system, he said.

These workers, Schneider said, are not paying the unemployment tax or premiums to cover injuries on the job. That means the cost falls back onto the rest of the employers in the state, he said.

The governor earlier this week vetoed Senate Bill 207, which would have given authority to the state Labor Commissioner to levy hefty fines. The governor said there were other agencies that oversee the problem of misclassifying.

Both bills passed the Legislature over the opposition of Republicans.

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