Sean P. Redmond Sean P. Redmond
Vice President, Labor Policy, U.S. Chamber of Commerce


May 31, 2017


The Nevada state senate is considering a pair of proposals to raise the state’s minimum wage, each of which would maintain in the state’s constitution a controversial carve-out from the minimum wage for labor unions.

The practice of seeking exemptions from the minimum wage is not exactly new for organized labor. In fact, it became enough of a phenomenon that the Workforce Freedom Initiative (WFI) highlighted it in a report titled “Labor's Minimum Wage Exemption: Unions as the 'Low-Cost' Option,” which was first issued in 2014 and updated in 2016.

The report highlighted how organized labor frequently seeks an “escape clause” from new labor and employment mandates that is designed to make labor unions the “low cost” alternative. Typically, these escape clauses specify that any of the new mandates can be waived under a “bona fide” collective bargaining agreement. The cynical part of these carve-outs is that organized labor and groups funded by unions often lead the public campaigns to impose them in the first place.

Indeed, that is precisely what happened in Nevada when it adopted a constitutional amendment in 2006 to raise the minimum wage. Voters approved the increase with a ballot measure known as Question 6 by a vote of 69% to 31%, and unions were instrumental in putting it on the ballot.

The wording of Question 6 asked simply, “Shall the Nevada Constitution be amended to raise the minimum wage paid to employees?” However, it conveniently left out the following part of the amendment: “all of the provisions of this section [of the constitution]…may be waived in a bona fide collective bargaining agreement.” Thus, Nevada became somewhat of an early adopter of this type of union escape clause for the minimum wage.

Fast forward to today, and Nevada legislators have filed two different measures that would increase the current minimum wage.

One of the measures is a bill (SB 106) to enact $0.75 increases (up from the current level of $7.25 for employers that provide health benefits and $8.25 for those who do not) each year for five years until the minimum reaches at least $12 and $11, respectively, depending on whether health benefits are offered. If enacted, as a law it presumably would not alter the union escape clause enshrined in the state constitution.

The second proposal was introduced as a joint resolution (SJR 6) to amend the constitution again, raising the minimum wage up to $9 with annual $0.75 increases starting in 2022 until the minimum wage reaches $12 per hour. However, as introduced, SJR 6 included a provision that would repeal the carve-out for the union escape clause.

On May 26, the Senate’s majority leader, who has frequently supported organized labor’s agenda, proposed an amendment to SJR 6 that would maintain the collective bargaining waiver in the state’s constitution. Time will tell if either of these minimum wage measures ultimately succeeds, but either way the union escape clause seems likely to live on.

About the authors

Sean P. Redmond

Sean P. Redmond

Sean P. Redmond is Vice President, Labor Policy at the U.S. Chamber of Commerce.

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