MDC Rests., LLC v. Eighth Judicial Dist. Court of Nev.

• Decision Date: 31 May 2018
• Docket Number: No. 71289,71289
• Parties: MDC RESTAURANTS, LLC; Laguna Restaurants, LLC ; and Inka, LLC, Petitioners, v. THE EIGHTH JUDICIAL DISTRICT COURT OF THE STATE OF NEVADA, IN AND FOR the COUNTY OF CLARK; and the Honorable Timothy C. Williams, District Judge, Respondents, and Paulette Diaz; Lawanda Gail Wilbanks; Shannon Olszynski; and Charity Fitzlaff, all on behalf of themselves and all similarly situated individuals, Real Parties in Interest.
• Court: Nevada Supreme Court

419 P.3d 148

MDC RESTAURANTS, LLC; Laguna Restaurants, LLC ; and Inka, LLC, Petitioners,

v. THE EIGHTH JUDICIAL DISTRICT COURT OF THE STATE OF NEVADA, IN AND FOR the COUNTY OF CLARK; and the Honorable Timothy C. Williams, District Judge, Respondents,andPaulette Diaz; Lawanda Gail Wilbanks; Shannon Olszynski; and Charity Fitzlaff, all on behalf of themselves and all similarly situated individuals, Real Parties in Interest.

No. 71289

Supreme Court of Nevada.

MAY 31, 2018

Clark Hill PLLC and Nicholas M. Wieczorek, Deanna L. Forbush, and Jeremy J. Thompson, Las Vegas, for Petitioners.

Wolf, Rifkin, Shapiro, Schulman & Rabkin, LLP, and Bradley S. Schrager, Jordan J. Butler, and Don Springmeyer, Las Vegas, for Real Parties in Interest.

Jackson Lewis P.C. and Elayna J, Youchah and Phillip C. Thompson, Las Vegas, for Amici Curiae Claim Jumper Acquisition Co., LLC; Landry's Inc.; Landry's Seafood House—Nevada, Inc.; Landry's Seafood House—Arlington, Inc.; Bubba Gump Shrimp Co. Restaurants, Inc.; Morton's of Chicago/Flamingo Road Corp.; and Bertolini's of Las Vegas, Inc.

Littler Mendelson and Rick D. Roskelley, Kathryn B. Blakey, Roger L. Grandgenett, II, and Montgomery Y. Paek, Las Vegas, for Amici Curiae Briad Restaurant Group, LLC; Wendy's of Las Vegas, Inc.; Cedar Enterprises, Inc.; and Terrible Herbst, Inc.

BEFORE THE COURT EN BANC.

OPINION

By the Court, PICKERING, J.:

The Minimum Wage Amendment (MWA) to the Nevada Constitution allows an employer who provides health benefits to pay a minimum wage of one dollar per hour less than an employer who does not provide health benefits. In this case, we are asked to clarify what health benefits an employer must provide to qualify for this privilege. We answer that the MWA requires an employer who pays one dollar per hour less in wages to provide a benefit in the form of health insurance at least equivalent to the one dollar per hour in wages that the employee would otherwise receive. Because the district court applied the substantive requirements of NRS Chapters 608, 689A, and 689B, rather than the standard set forth in this opinion, we grant petitioners' request for extraordinary relief.

I.

A.

The MWA is the result of a voter initiative called "The Raise the Minimum Wage for Working Nevadans Act." Posed as a statewide ballot question in 2004 and 2006, the measure declared that "[n]o full-time worker should live in poverty in our state" and that "[r]aising the minimum wage is the best way to fight poverty." Secretary of State, Statewide Ballot Questions, Question No. 6, p. 35 (2006), http://nvsos.gov/sos/home/showdocument?id=206. It stated that "[l]iving expenses such as housing, healthcare, and food have far outpaced wage levels for Nevada's working families" and that a higher minimum wage would help "make sure the workers who are the backbone of our economy receive fair paychecks that allow them and their families to live above the poverty line." Id. After the measure passed in both 2004 and 2006, it became Article 15, Section 16 of the Nevada Constitution. In relevant part, the MWA reads:

Each employer shall pay a wage to each employee of not less than the hourly rates set forth in this section. The rate shall be five dollars and fifteen cents ($5.15) per hour worked, if the employer provides health benefits as described herein, or six dollars and fifteen cents ($6.15) per hour if the employer does not provide such benefits. Offering health benefits within the meaning of this section shall consist of making health insurance available to the employee for the employee and the employee's dependents at a total cost to the employee for premiums of not more than 10 percent of the employee's gross taxable income from the employer. These rates of wages shall be adjusted by the amount of increases in the federal minimum wage over $5.15 per hour, or, if greater, by the cumulative increase in the cost of living.

Nev. Const. art. 15, § 16 (A).

When the MWA went into effect in 2006, the minimum wage was $5.15 per hour if an employer provided health benefits, and $6.15 if an employer did not provide health benefits. See Nev. Const. art. 15, § 16 (A). The MWA requires that those wages be adjusted according to standards articulated in the text of the MWA itself. See id. Currently, as adjusted and annually announced by the Office of the Labor Commissioner, the upper-tier minimum wage is $8.25 per hour, and the lower-tier minimum wage is $7.25. See Press Release, State of Nevada Department of Business and Industry, Nevada's minimum wage and daily overtime rates will not increase in 2017 (March 30, 2017), http://labor.nv.gov/uploadedFiles/labornvgov/content/Wages/2017M¨inimum0¨Wage0¨PressR¨elease.pdf. To pay an employee the lower-tier minimum wage, the employer must "provide[ ] health benefits" to the employee. Nev. Const. art. 15, § 16. To provide health benefits means to make health insurance available to an employee and his or her dependents at a total cost to the employee for premiums not more than 10 percent of the employee's gross taxable income. Id.

B.

Real parties in interest include four named plaintiffs who sued on behalf of themselves and other similarly situated employees (collectively "employees"), alleging that their employers paid them the lower-tier minimum wage without providing sufficient health benefits under the MWA, Petitioners MDC Restaurants, LLC; Laguna Restaurants, LLC; and Inka, LLC (collectively "MDC") are the plaintiffs' employers and the defendants in the suit in district court.¹ The employees moved for summary judgment, arguing that the health insurance offered by MDC did not qualify MDC to pay the lower-tier minimum wage because it did not comply with Nevada statutes placing substantive requirements on health insurance.

The district court granted the employees' motion, determining that an employer only provides health benefits sufficient to pay the MWA's lower-tier minimum wage if the employer offers health insurance that complies with NRS Chapters 608, 689A, and 689B. NRS Chapter 608 places substantive requirements on employer-provided health insurance and requires an employer who offers health benefits to provide insurance that complies with NRS Chapters 689A and 689B.² NRS Chapter 689A regulates "individual health insurance" and Chapter 689B regulates "group and blanket health insurance." Both chapters mandate when certain benefits must be covered, including coverage for expenses such as hospice care, prescription drugs, cancer treatment, the management and treatment of diabetes, severe mental illness, and alcohol or drug abuse. The district court reasoned that because the "limited benefit plans" offered by MDC did not satisfy the statutory requirements of NRS Chapters 608, 689A, and 689B, the plans were not "health insurance" under the MWA sufficient to qualify MDC to pay the lower-tier minimum wage.

MDC now requests a writ of mandamus directing the district court to vacate its order granting partial summary judgment and either (1) refer the employees to the Labor Commissioner for an initial consideration of their wage complaints; or (2) direct the district court to evaluate the plans offered by MDC under NAC 608.102 instead of NRS Chapters 608, 689A, and 689B.

II.

Whether to grant extraordinary relief is solely within this court's discretion. See Smith v. Eighth Judicial Dist. Court, 107 Nev. 674, 677, 818 P.2d 849, 851 (1991). Generally, mandamus will issue to compel performance of a judicial act that the law requires as a duty resulting from office, see NRS 34.160, when "there is not a plain, speedy and adequate remedy in the ordinary course of law," NRS 34.170. Where, as here, the petitioners instead seek clarification of a legal issue of first impression, mandamus can nonetheless be appropriate when "an important issue of law needs clarification and considerations of sound judicial economy and administration militate in favor of granting the petition." Int'l Game Tech., Inc. v. Second Judicial Dist. Court, 124 Nev. 193, 197-98, 179 P.3d 556, 559 (2008). However, "such relief must be issued sparingly and thoughtfully due to its disruptive nature" in litigation. Archon Corp. v. Eighth Judicial Dist. Court, 133 Nev. ––––, ––––, 407 P.3d 702, 709 (2017). Such a petition for a writ of advisory mandamus should be granted only "when the issue presented is novel, of great public importance, and likely to recur." Id. at ––––, at 708 (quoting United States v. Horn, 29 F.3d 754, 769 (1st Cir. 1994) ).

While we generally deny such petitions, articulating the standard for when an employer who offers health benefits can pay the lower-tier minimum wage is an issue of statewide importance that needs clarification. In fact, the Legislature recently passed legislation attempting to answer this exact question, but it was vetoed by the Governor. See Letter from Governor Sandoval to Secretary of State Cegavske, RE: Assembly Bill 175 of the 79th Legislative Session (June 9, 2017) [hereinafter Veto of A.B. 175], http://gov.nv.gov/uploadedFiles/govnvgov/Content/News_and_Media/Press/2017_Images_and_Files/AB175_VETO.pdf.³ And our state's district courts, as well as the federal district court, have been grappling with the issue presented in this petition as well. See, e.g., Tyus v. Wendy's of Las Vegas, Inc., No.: 2:14-CV-0729-GMN-VCF, 2017 WL 4381680 (D. Nev. Sept. 28, 2017) ; Hanks v. Briad Rest. Grp., LLC , No.: 2:14-CV-00786-GMN-PAL, 2017 WL 4349227 (D. Nev. Sept. 29, 2017) ; Abrams v. Peppermill Casinos, Inc., No. 3:16-CV-0454-MMD (VPC), 2017 WL 2485381 (D. Nev. June 8, 2017) ; Tarvin v. Hof's Hut Rest, Inc., No. A-16-741541-C (Eighth Judicial District Court, filed August 11, 2016). Thus, because the petition presents legal issues of statewide importance requiring clarification, and our decision will promote judicial economy and administration by assisting other jurists, parties, and lawyers, we exercise our discretion to consider the merits of this petition.

III.

MDC argues that the...