Assembly bill 200 would change workers’ compensation ceiling for construction workers to use prevailing wage

Assemblymember Venise Karas and Greg Esposito told the Assembly Commerce and Labor Committee that Assembly Bill 200 would change how Nevada calculates the maximum wage used to set workers’ compensation replacement benefits for construction workers.

Karas said the bill is intended to address what proponents called a shortfall in benefits for injured tradespeople. Esposito, representing the Nevada State Pipe Trades, said current law effectively limits many construction workers — especially in Clark and Washoe counties — to replacement rates that amount to about 30–43 percent of their typical wages when the statutory cap is applied. "When workers are averaging out anywhere from a hundred and 50,000 to a hundred and 75,000 a year, having their wages capped at a hundred and 1,000 a year for this year, limits or reduces what they really get if and when they get injured," Esposito said. He described the proposed fix as replacing the state's average maximum wage with a ceiling tied to the prevailing wage for construction trades.

Proponents argued the change would bring injured workers' benefits closer to the statutory intent of 66 2/3 percent of their wage and reduce financial hardship for families who otherwise "work injured" or return to work before medically ready. Dozens of labor organizations, unions and worker advocates testified in support during the hearing, including the Communication Workers of America, Nevada AFL‑CIO, Teamsters, Ironworkers, SEIU, and construction trade councils.

Business and construction groups told the committee they oppose AB 200 because its premium impacts on contractors are unknown. Witnesses from the Associated Builders and Contractors, Nevada Home Builders Association, Vegas Chamber, Associated General Contractors, Nevada Resort Association, Nevada Subcontractors Association, Nevada Contractors Association and others said they appreciate dialogue but have not received actuarial data showing how much premiums and project costs would rise. Mac Bybee of Associated Builders and Contractors summarized the concern: higher premiums could "roll up" into higher project prices and reduce construction activity.

A researcher from Nevada Policy told the committee prevailing wages in some occupations can be substantially higher than market averages (they cited examples such as roofers where prevailing wages in Clark and Washoe were materially above market wages) and warned of potential cost inflation. Committee counsel and committee members discussed legal questions about creating a separate class for construction workers; counsel said equal‑protection review would likely be rational‑basis and therefore defensible.

Victoria Cartieron, administrator of the Division of Industrial Relations, testified neutral and described the administrative work the agency would need to perform (revising forms, adding average prevailing wage inputs and training insurers). Esposito acknowledged the bill would increase workers' compensation premiums but said proponents were working with opponents on mechanics and an effective date that would give the insurance industry lead time. The committee did not vote on AB 200 in the hearing.

Key numeric points cited in testimony: proponents described an example where affected workers' replacement rates drop from the statutory 66 2/3 percent to as low as about 30% of wages under the current cap; Nevada's average workers' compensation rate was described in testimony as about $0.84 per $100 of payroll (proponents compared that to Texas at $0.41 and Wyoming at $1.83). Proponents said the current statutory cap is recalculated annually by the Division of Industrial Relations using data from DETR.

Committee counsel answered a question about potential constitutional issues, saying separate classifications that do not involve suspect classes are reviewed under rational basis and are generally defensible. The sponsor and proponents said they would continue working with stakeholders on the technical mechanics and on obtaining actuarial information about premium impacts.