MINUTES OF THE
SENATE Committee on Commerce and Labor
Seventy-second Session
March 7, 2003
The Senate Committee on Commerce and Labor was called to order by Chairman Randolph J. Townsend, at 7:05 a.m., on Friday, March 7, 2003, in Room 2135 of the Legislative Building, Carson City, Nevada. The meeting was videoconferenced to the Grant Sawyer State Office Building, Room 4401, 555 East Washington Avenue, Las Vegas, Nevada. Exhibit A is the Agenda. Exhibit B is the Attendance Roster. All exhibits are available and on file at the Research Library of the Legislative Counsel Bureau.
COMMITTEE MEMBERS PRESENT:
Senator Randolph J. Townsend, Chairman
Senator Warren B. Hardy II, Vice Chairman
Senator Ann O'Connell
Senator Raymond C. Shaffer
Senator Joseph Neal
Senator Michael Schneider
Senator Maggie Carlton
GUEST LEGISLATORS PRESENT:
Senator Bernice Mathews, Washoe County Senatorial District No.1
STAFF MEMBERS PRESENT:
Scott Young, Committee Policy Analyst
Courtney Wise, Committee Policy Analyst
Kevin Powers, Committee Counsel
Makita Schichtel, Committee Secretary
OTHERS PRESENT:
Jon L. Sasser, Lobbyist, Washoe Legal Services Incorporated
Lynda Parven, Administrator, Nevada Equal Rights Commission, Department of Employment, Training and Rehabilitation
Steve G. Holloway, Lobbyist, Associated General Contractors
John E. Jeffrey, Lobbyist, Southern Nevada Building and Construction Trades Council
Lori T. Ashton, Lobbyist, Southwest Regional Council of Carpenters
Roger Bremner, Administrator, Division of Industrial Relations, Department of Business and Industry
Ivan R. “Renny” Ashleman, Lobbyist
Pat Coward, Lobbyist, GlaxoSmithKline
Julene A. Bertuleit, Senior Executive, Vaccine Account Manager, GlaxoSmithKline
Dan Musgrove, Lobbyist, Clark County
Michael Gillins, Lobbyist, Las Vegas Police Protective Association, and Nevada COPS
Ronald P. Dreher, Lobbyist, Peace Officers Research Association of Nevada
Raymond C. McAllister, Lobbyist, Vice President, Professional Firefighters of Nevada
James Jeppson, Risk Manager, Division of Risk Management, Washoe County
Michael B. Neville, Lobbyist, Washoe County DA Investigators Association
Ray Bacon, Lobbyist, Nevada Manufacturers Association
John Wiles, Senior Attorney, Division of Industrial Relations, Department of Business and Industry
We will open the meeting with Senate Bill (S.B.) 167. We have been asked to withdraw this bill.
SENATE BILL 167: Revises provisions relating to industrial insurance. (BDR 53‑337)
SENATOR O’CONNELL MOVED TO INDEFINITELY POSTPONE S.B. 167.
SENATOR NEAL SECONDED THE MOTION.
THE MOTION CARRIED. (SENATORS SCHNEIDER AND CARLTON WERE ABSENT FOR THE VOTE.)
Chairman Townsend:
We will now open the hearing on S.B. 24. This is Senator Neal’s bill regarding medical records for deceased persons. We have a proposed amendment prepared by Mr. Powers, Committee Counsel, in the work session information handout for Senate Committee on Commerce and Labor Friday, March 7, 2003, (Exhibit C. Original is on file in the Research Library.).
SENATE BILL 24: Provides for access for certain persons to health care records of deceased. (BDR 54-178)
SENATOR NEAL MOVED TO AMEND AND DO PASS AS AMENDED S.B. 24.
SENATOR O’CONNELL SECONDED THE MOTION.
THE MOTION CARRIED. (SENATORS SCHNEIDER AND CARLTON WERE ABSENT FOR THE VOTE.)
*****
Chairman Townsend:
We will open the hearing on S.B. 22.
SENATE BILL (S.B.) 22: Broadens applicability of laws relating to unlawful employment practices. (BDR 53-132)
Chairman Townsend:
Notice the memo from Professor Robert Correales, included in Exhibit C, regarding the Americans with Disabilities Act (ADA). The issue is whether small businesses will face a financial burden if forced to provide accommodations to disabled employees. It concerns me that the burden is on the small employer to show the regulatory agency they are burdened. They might provide scheduling‑type accommodations but not physical accommodations. Also in the handout, a memo from Scott Young, Committee Policy Analyst, shows how other jurisdictions handle this issue. Kentucky has left all requirements in the statute regarding discrimination at eight employees, but accommodates the small employer by setting the minimum number for ADA purposes at 15. To reduce the number of employees from 15 to 5 will result in employers with five employees having to meet all discrimination aspects and will impact the costs to those small employers.
Senator Neal:
In the memo from Professor Correales, employment discrimination does not entail additional requirements for the disabled persons if they can do the job. It is not the disability, but the ability to do the job, then being denied employment that is important. Our statute separates the disability law from the employment law in that regard. We still retain those requirements that provide ramps and other accommodations for the disabled. The memo from Professor Correales confirms this bill would have no affect on the disability laws of Nevada.
Jon L. Sasser, Lobbyist, Washoe Legal Services Incorporated:
There are two separate laws, one based on employment discrimination, and the other on public accommodations. Building ramps and making a business accessible to people with disabilities has nothing to do with how many a company employs. A sole proprietorship that does business with the public must still comply with the public accommodation laws. The number of employees is a factor in employment discrimination. A company is required to make reasonable accommodations to the disabled applicant. An applicant may have a problem reading or hearing. The company could work around these kinds of disabilities. The small businesses need not begin installing elevators and ramps in anticipation of this bill passing. They need to deal with the individual applicant to determine reasonable accommodations, which generally means cheap accommodations, based on cost and size of the business. Any fears this bill has caused of being forced to build ramps are not justified. Employment discrimination would apply if an applicant with a disability, who is otherwise qualified, was not considered if reasonable accommodations could have been made.
Senator O’Connell:
How narrowly defined is “reasonable”?
Mr. Sasser:
There is a body of case law under the federal ADA that State employment discrimination laws would reference to interpret the term “reasonable.” Professor Correales addressed this in his first memo to the committee. It would take into account the business size and expense of the accommodation. Reasonable generally means reasonable in costs.
Senator O’Connell:
Is that subjective to the person making the call?
Mr. Sasser:
There is some subjectivity based on the individual’s limitations and the particular job duties involved. Sometimes accommodating a person’s schedule is considered reasonable. The first memo by Professor Correales presented a study by the Las Vegas Chamber of Commerce. A small number of accommodation costs exceeded $100. Most were very cheap.
Senator Hardy:
Who establishes what is reasonable? If a business were challenged, would the business have the legal responsibility to hire an attorney and establish what reasonable means?
Mr. Sasser:
Generally, an applicant and an employer negotiate what the person needs to do the job. The burden of proof, in the case of litigation, I believe would be on the applicant. I am not sure.
Senator Hardy:
The employer would still have an obligation to defend his side of the issue. If we pass this law, will this relate only to those applying for jobs, or also existing employees? A business owner makes those decisions in the hiring process. This law will take away that chance.
Senator Neal:
I would like to reference the memo from Professor Correales where he summarizes his thoughts.
Senator Hardy:
I just received the handout and I will read it. Is there anything in the law to protect employers against frivolous claims or lawsuits?
Mr. Sasser:
Yes. There are sanctions against attorneys filing such suits under rule 11. The court can also award costs and attorneys fees against the losing party. The Nevada Equal Rights Commission (NERC) follows an administrative process before going to court. The limitation on damages that can be awarded is 2 years back pay. It is limited liability.
Back to Senator O’Connell’s question, Professor Correales cited a study by Sears that 69 percent of accommodations cost nothing. They were small changes. Twenty-eight percent cost less than $1000, and only three percent cost over $1000. They averaged $50 per reasonable accommodations request. The NERC added a fiscal note to this bill, which is found in the handout as a memo from Martin Ramirez. If the committee feels this is good policy, I suggest you pass it on to the Senate Committee on Finance to consider the fiscal note.
Senator Neal:
Is anyone here from the NERC? Would you tell us how you arrived at this fiscal note?
Lynda Parven, Administrator, Nevada Equal Rights Commission, Department of Employment, Training and Rehabilitation:
Part of this note is based on salary for one and a half new investigator positions with the ADA and one position without the ADA. It is based on new employees included in the population.
Senator Neal:
What is the ADA specification?
Ms. Parven:
Senator Townsend asked me to split the cost based on whether disability was included in lowering the limit to five employees, and to determine at the current rate. The current 8281 employers with 15 or more employees have a total of 916,573 employees. Out of those, approximately 0.20 percent file complaints. Senate Bill 22 adds 11,039 additional employers who employ 5 to 14 employees, at an additional 90,164 employees. We calculated 0.20 percent of the new pool of people would also file with our agency.
Senator Neal:
At what percentage over 15 percent did you research? It seems you would look at the upper end of that percentage, say 15 to 20 employees. That might be a better indicator than if we look at five employees or more. The bill is reducing the number of employees from 15 to 5. To determine possible filings, you might get a better idea of number of complainants if you look at employers of 15 or more.
Ms. Parven:
We looked at the general population of employees, whether they have 15 or 1000 employees. We calculated there would be an additional 180 cases. An investigator can resolve 132 cases a year on average.
Senator Neal:
Did you research other states having lower numbers of minimum employees than we do currently?
Ms. Parven:
I did speak to the California Equal Rights Commission department, but they could not break the numbers down. They told me what portion of their caseload was in that percentage, but they could not break it into people because they do not separate their investigators in such a manner.
Senator Neal:
Did you research other states besides California regarding the fiscal note?
Ms. Parven:
No. I spoke to the ERC people in California and Idaho who have this law, and asked what percentage of their cases fell into those numbers.
Senator Neal:
What did you learn from the ERC in Idaho?
Ms. Parven:
It is in my original testimony. I believe Idaho showed a 6 percent caseload, and California showed a 19 percent caseload occurring in the 5 to 14 employees category.
Senator Neal:
Did you not feel the need to research other states?
Ms. Parven:
We had short notice of this hearing. I had time to call the two states that I knew had the law of 5 to 14 minimum employees.
Senator Neal:
Did you speak to the Equal Employment Opportunity Commission Board?
Ms. Parven:
Yes, I did. They do not deal with any numbers less than 15. In addition to the base cost of additional positions required, there is also a cost of the deputy attorney general. These cases would not have federal protection, so they require some resolution within the Nevada Equal Rights Commission. Currently, people with probable cause obtain a right to sue from the federal government. Their case goes to EEOC, and is filed in federal court. These cases will not be eligible for the federal court process. We would need to hold public hearings because they would have no other resolution available.
Chairman Townsend:
If this bill was not in place and we had an economic boom and added 90,000 additional employees for employers of 15 or more, would your fiscal note be the same?
Ms. Parven:
Economic downturns normally increase our caseload, rather than booms. If we have an increase in population, we have an increase in cases. We have experienced this over the past few years.
Chairman Townsend:
You are stating if you add employees eligible to file, then you calculate the appropriate percentage, and your fiscal note applies. I am asking if we have an economic growth that added 90,000 employees to employers of 15 or more, would the fiscal note be the same?
Ms. Parven:
Yes, we are currently asking for two additional investigators in our budget for this reason.
Chairman Townsend:
We are not the finance committee. It is interesting to note that for every $70,000 salaried person we add, the total cost becomes $225,000.
Ms. Parven:
The bulk of the cost is the deputy attorney general fee. Those fees do not apply to each position, but are needed because the cases would not be federally eligible cases.
Chairman Townsend:
Out of the 90,000 employees added, there will be an additional 180 potential cases. These 180 cases would require $117,000 worth of deputy attorney general fees?
Ms. Parven:
This is based on 24 probable cause cases per year, which is 13 percent. I spoke with the attorney general’s office. Twenty-four probable cause cases would be a minimum of 12 public hearings a year, resulting in the need for an additional deputy attorney general to assist the Nevada Equal Rights Commission.
Chairman Townsend:
Does each public hearing cost the attorney general approximately $10,000?
Ms. Parven:
I think so. It is based on the amount of time needed to prepare and hold a public hearing.
Chairman Townsend:
Does is really cost non-State-owned rent, in this case $5200, each time we hire someone?
Ms. Parven:
Our cost is allocated throughout the department. I believe it is the cost per person within the Department of Employment, Training and Rehabilitation.
Chairman Townsend:
In applying that to my firm in Reno, our cost for rent is significantly less than $5200 per person.
Ms. Parven:
Our department cost allocation covers financial management, human resources, computer assistance, and other services provided by the department.
Senator Neal:
If appropriate, we could send this bill to the finance committee. In the meantime, we have a list on the handout that shows many states with employers having less than 15 employees. New Mexico is listed as having fewer than four employees. Wyoming has fewer than two. These might be comparable to Nevada in terms of population and makeup. For some reason, the Equal Rights Commission did not look at those states to determine costs. I believe it would be less than what is being proposed in this fiscal note. I would like to move to re-refer this bill to the finance committee.
Chairman Townsend:
If the motion passes, the Assembly may pass it back without a fiscal note. Your agency could report to them if your caseload increased and you needed those additional people. Your agency could report on a monthly basis to determine caseload. When you look at other comparable jurisdictions, there are several that have five or less employees. Maybe our State is more vulnerable to lawsuits because of our transient nature.
Senator Shaffer:
Do you have any difficulty recruiting competent people for these duties?
Ms. Parven:
We have great difficulty recruiting bilingual people. We have difficulty finding people who can pass the test.
SENATOR NEAL MOVED TO DO PASS AND RE-REFER TO THE SENATE COMMITTEE ON FINANCE S.B. 22.
SENATOR SCHNEIDER SECONDED THE MOTION.
Chairman Townsend:
While we are waiting for Senator Carlton, we will discuss S.B. 12. We will not process that bill today. The language, which is broader to encompass all lines of insurance for flexible rating, will be in another bill to be heard on Tuesday.
SENATE BILL 12: Makes various changes regarding insurance. (BDR 57-99)
Chairman Townsend:
Ms. Parven, are you aware you are not allowed to recover any costs in a successful prosecution? Is that prohibited under federal law? If you go to a hearing, prosecute, and win, you cannot recover your costs. It is not available under a current statute. Is it prohibited under federal law?
Ms. Parven:
Do you mean if a complainant goes to court and wins? They can recover. We cannot.
Chairman Townsend:
Would you like to ask for that?
Ms. Parven:
Sure.
Chairman Townsend:
We do not wish to hurt employers who are trying to do their best. If they are discriminating against persons with disabilities, it is a different story. This may be an option available to offset costs.
THE MOTION PASSED. (SENATORS HARDY AND O’CONNELL VOTED NO.)
*****
Chairman Townsend:
We will open the hearing on S.B. 71.
SENATE BILL 71: Authorizes contractor to withhold money or require surety bond to guarantee payment of certain indebtedness of subcontractors and other contractors. (BDR 53-402)
Senator Hardy:
I have made a public disclosure. Out of an abundance of caution, I would like to do so in each committee. I am employed by the Construction Trade Association in southern Nevada. My disclosure is on file with the director of the Legislative Counsel Bureau. I will follow the ethics laws and not vote on laws impacting my group. I do not believe the bill before us does impact my group. I do intend to vote on this bill.
Chairman Townsend:
Mr. Holloway, on behalf of Associated General Contractors, presented an amendment to this bill. Mr. Holloway, are you aware of Mr. Jeffrey’s amendment from the Southern Nevada Buildings and Constructions Trades?
Steve G. Holloway, Lobbyist, Associated General Contractors:
Yes, I am. This amendment originated from a discussion with the trust attorneys for the labor and management trusts. We concur with the amendment. This amendment replaces one we submitted 2 weeks ago.
John E. Jeffrey, Lobbyist, Southern Nevada Building and Construction Trades Council:
We propose an addition to this amendment (Exhibit D). The trust attorneys asked for additional language in this amendment, paragraph b, line 5, to add reasonable attorney fees, if the trust has to go after the surety to get payment. Mr. Holloway agreed with that amendment.
Chairman Townsend:
You are addressing the amendment you recently submitted.
Lori T. Ashton, Lobbyist, Southwest Regional Council of Carpenters:
Our concern with this bill is the number of rapidly made amendments. They may not have been thoroughly considered. The industry has concerns that need to be addressed. The difficulty with surety bonds is the recovery once subcontractors or contractors to the original contractor are required to pay. They litigate. You cannot prove to these contractors they are obligated for the funds, and then receive payment. Litigation is costly and extensive. We believe the responsibility of the bonding companies to act on payment needs to be addressed. The parameters are limited to 1 year. Currently, projects last longer than a year. Once projects are complete, original contractors have to review funds, wages and hours; it often takes longer than a year to find problems. The labor commissioner has up to 2 years to go back on wage and hour violations. If you limit it to 1 year, you may be excluding an avenue for restitution. We have serious concerns this bill has been written hastily. We recommend pulling the bill and reviewing it during the interim in order to address problems facing the industry. We fear this will hurt minority contractors, such as subcontractors, who have to maintain multiple bonds for years.
Chairman Townsend:
Were you not here when we first heard this bill?
Ms. Ashton:
I learned about the bill via the Internet in Las Vegas. When I heard the bill went through, we discussed it with our trust funds people.
Chairman Townsend:
We want to make sure we are not missing input from you. We post bills in the same manner we have for years.
Ms. Ashton:
We were all trying to work out an agreeable amendment to the original proposal.
Chairman Townsend:
Are you not a member of the Southern Nevada Building and Constructions Trades?
Ms. Ashton:
No, we are not.
Chairman Townsend:
You need to get on the same page. If you are listening on the Internet, you are missing 90 percent of what we are doing. If you have a large interest, then you need to get involved.
Ms. Ashton:
I agree. We were working and corresponding. We thought those issues had been addressed. Our only concern is the 1-year time frame may be prohibitive, and a possible impact to small, minority subcontractors.
Chairman Townsend:
As we have an amendment and an additional amendment, I would like to process this bill. Make sure you and these gentlemen with Southern Nevada Building and Construction Trades have an open line of communication. If any of you notice something out of line, let us know before this bill gets to the floor. If it is a technical issue, we can have it corrected on the Assembly side.
Mr. Holloway:
That is very fair.
Chairman Townsend:
As you three are our resident experts, we would like you to look at this bill.
Mr. Jeffrey:
I agree. This is a fair proposition.
Chairman Townsend:
We have S.B 71, with an original amendment by Mr. Holloway with the Associated General Contractors. We have an additional amendment proposed by the Southern Nevada Building and Construction Trades Council. The second amendment includes the provisions of the first, so both sides agree. We can adopt both at one time.
Senator Neal:
Do the two amendments conflict?
Chairman Townsend:
No, they do not.
Senator O’Connell:
There are actually three amendments, adding reasonable attorney fees.
Chairman Townsend:
Correct. We can consider all three at once.
SENATOR O’CONNELL MOVED TO AMEND AND DO PASS S.B.71, WITH THE TWO EXISTING AMENDMENTS AND THE ADDITIONAL LANGUAGE OF REASONABLE ATTORNEY FEES, SECTION B, LINE 5 OF EXHIBIT D.
SENATOR CARLTON SECONDED THE MOTION.
THE MOTION CARRIED UNANIMOUSLY.
*****
Chairman Townsend:
We will open the hearing on S.B. 168.
SENATE BILL 168: Revises provisions governing industrial insurance. (BDR 53‑466)
Chairman Townsend:
This is Mr. Bremner’s bill. Mr. Wiles submitted a proposed amendment. Mr. Ashleman submitted additional comments (Exhibit E). There is a lack of agreement between these two suggestions.
Roger Bremner, Administrator, Division of Industrial Relations, Department of Business and Industry:
I believe the only difference we have concerns the due diligence language when assessing fines. We disagree with the amendment proposed by Mr. Ashleman to include the due diligence language. The only leverage the division has is the fining mechanism. We do not like to use this indiscriminately, but in some cases fining is necessary. The filing of a workers’ compensation claim, C4, is a very important function, particularly in lost time claims. The statute was changed in 1995. At the time there were only two ways to acquire workers’ compensation insurance, by EICON, the former State Industrial Insurance System now known as Employers’ Insurance Company of Nevada, or by self‑insured. Our intent is not to fine those providers of workers’ compensation services, but we do feel due diligence unduly weakens our ability to fine the egregious violators. They could use due diligence as a defense.
Ivan R. “Renny” Ashleman, Lobbyist:
I represent University Medical Center (UMC). Our problem is twofold, as outlined in Exhibit E. Without some standard, it is possible a review in court would read like a traffic ticket. If a person is late, they can be fined. The other concern, which the division should be concerned about, is the lack of a standard. If I were defending someone, I would be quick to point that out in a court. There is no standard; it is an unbridled discretion. Unbridled discretion is not favored in the law when addressing penalties. A fine is a penalty. Due diligence is the only phrasing they seem to be willing to use. We are not in agreement to the term due diligence. The statute seems to intend a good effort be made. It is often impossible for University Medical Center and the doctors to get the information they need for filing in a timely manner. Often the injured workman does not know the insurer, or his employer, if he works various jobs. There is no good mechanism for getting insurance information to the employee. It seems we need protection. This is our only disagreement with the language.
Chairman Townsend:
Mr. Bremner, we realize you may not be in your position forever. The next person may not be as knowledgeable, understanding, or have the same working relationships as you do. We have to write the laws to accommodate both issues. More importantly, if the UMC submits an incomplete C4, but they meet the deadline, do they get fined? Mr. Ashleman was here when we got tough. We had to be strict because administrators were not fining people. Employees were unable to collect benefits. People were not getting paid. Things were a mess. We need to tighten the system down. If an applicant met the deadline but left the form incomplete, would that constitute a fine?
Mr. Bremner:
If the paperwork was submitted in a timely manner to the correct insurer, we would not know about the claim unless we found it in an audit.
Chairman Townsend:
The insurer would either accept or reject it?
Mr. Bremner:
Correct. The C4 needs to be marked with the proper insurer.
Chairman Townsend:
This is the main issue. If the one blank left on the C4 form is the identification of the insurer, how will it get to the right place?
Mr. Bremner:
A copy would also be sent to the employer. It must be sent to the employer and the insurer. Getting it to the right place in a timely manner is the main issue.
Chairman Townsend:
Not every employee in the State is aware of the name of his or her workers’ compensation carrier, nor should they be held to that standard. Hopefully, employees do know, but it is not feasible to think everyone knows. I would have to find the card in my wallet to know my carrier. I do not think the average person thinks about his carrier’s identity when he gets up in the morning.
Mr. Bremner:
I would take that further and suggest not every employer knows the name of his or her workers’ compensation carrier. We understand that issue. This is why we have changed the wording from, “the administrator shall impose an administrative fine” to “the administrator may impose an administrative fine.”
Chairman Townsend:
Mr. Ashleman, your recommendation has two components. The administrator may, instead of shall, impose a fine of not more than $1000 on the treating physician or chiropractor. You have added, “if he determines that the physician or chiropractor failed to exercise due diligence.” What if we say, “the administrator may impose administrative fines.” We want them fined because we do not want employers or insurance companies going unnoticed, or benefits not being obtained. This is a big step forward.
Mr. Ashleman:
I appreciate it. However, I repeat my question, under what circumstance may he impose a fine? You still must have a standard. There must be some reason for a fine, and it seems the appropriate reason is lack of due diligence. Otherwise, the administrator can impose a fine for failing to file a complete claim even when it is impossible to do so.
Senator Neal:
You want to put into statute claims for compensation, a standard that is normally associated with mergers and acquisitions. This would make the law difficult to administer.
Senator Hardy:
What if we said “shall” impose an administrative fine, leaving the existing language, and then add, “if he determines.” Does this leave a level of action that might work?
Chairman Townsend:
We do not have to make a decision today. We cannot draft for 2 weeks until the bills have all been introduced. This committee has worked tirelessly on issues helping administrators have a process that works on behalf of employers, insurers, and claimants. We understand the challenges faced by hospitals today. We will hold this bill and allow all parties to think about the issues. During our next work session, perhaps some common ground will be found. Subcommittee members are available to listen to any input in the meantime. Senate Bill 168 is on hold.
Chairman Townsend:
We will open the hearing on S.B. 10.
SENATE BILL 10: Prohibits certain regulation of use of telephonic device by person who is operating motor vehicle. (BDR 58-57)
SENATOR CARLTON MOVED TO DO PASS S.B. 10.
SENATOR O’CONNELL SECONDED THE MOTION.
THE MOTION CARRIED UNANIMOUSLY.
*****
Chairman Townsend:
We will now open the hearing on S.B. 184.
SENATE BILL 184: Revises certain provisions governing occupational diseases contracted by police officers. (BDR 53-851)
Chairman Townsend:
Committee, I suggest you look at S.B. 241, commonly known as construction defects, introduced yesterday. It is complex and lengthy. Mr. Powers, you did a remarkable job in writing this bill. You captured, with a great deal of clarity, a tough topic.
SENATE BILL 241: Makes various changes to provisions governing certain claims for constructional defects. (BDR 3-156)
Pat Coward, Lobbyist, GlaxoSmithKline:
We would like to offer an amendment that delineates between hepatitis A, B, and C (Exhibit F). Currently, testing for hepatitis C is done annually. We want to maintain protection to first responders. We also want to provide some cost savings. Once a person is vaccinated for hepatitis A and B, the testing is finished. Local government can provide mandatory testing on hepatitis C on a yearly basis. If a person is vaccinated for hepatitis A, then testing does not have to be performed every year.
Senator Schneider:
Are there any risks to these vaccinations?
Julene A. Bertuleit, Senior Executive, Vaccine Account Manager, GlaxoSmithKline:
No. No blood or blood products are used in making these vaccines. They are very safe. Sometimes a person experiences injection-site soreness. They have been using this vaccine since 1986.
Senator Schneider:
If we were to require frontline responders such as firemen, policemen, and wildlife workers be vaccinated, will they be covered for life?
Ms. Bertuleit:
Yes. This is what the Centers for Disease Control and Prevention (CDC) states. Most of these first responders have already been immunized for hepatitis B. It would be redundant to test yearly since they already have immunity. The CDC states a booster shot is not needed. They recommend protective immunity. If the measurement level in the blood of the antibody drops below a certain level, and if an exposure occurred, the protective immunity would kick in. There is a memory response, and that is why the CDC said three shots are needed for hepatitis A and B. There is basically 100 percent protection with both vaccines.
Senator Schneider:
How much does that cost?
Senator Mathews:
I am going to ask Pat Coward to speak on my behalf. I have worked with his group.
Chairman Townsend:
We understand. If you have your name on a bill, we want to make sure we capture your intent. The original intent of this bill was to explain the seriousness of hepatitis C. We have experts from the pharmaceutical community who will explain how the vaccines work. The challenge is in section 2 where we are adding other people to the testing. Let us look at these issues separately, hepatitis and adding people. Mr. Coward presented an amendment to your bill.
Senator Mathews:
I agree fully with the amendment.
Chairman Townsend:
Have all of the affected parties had a chance to see this amendment?
Mr. Coward:
I have talked to John Slaughter, Lobbyist, Washoe County, and Dan Musgrove, Lobbyist, Clark County.
Chairman Townsend:
Mr. Musgrove, because you represent a large group which could be affected financially by this bill, we would like your input.
Dan Musgrove, Lobbyist, Clark County:
I just received the amendment this morning. Previously, I discussed this bill with Mr. Coward. At our last meeting the Clark County Board of Commissioners supported the concept of testing, covering police and detention officers. I am in favor of this amendment as presented.
Senator Carlton:
Are you trying to eliminate the presumptive? Are you going to only annual testing or annual plus additional testing?
Mr. Coward:
It does not change. The law currently calls for annual testing for hepatitis A, B, and C. We are changing the definition of the testing requirements for hepatitis C, which must be tested anyway. Local government or the employer has the option, with consent of the receiving party, to choose the vaccination or testing. Also, Mr. McAllister brought up an important point that the employer would be required to pay for all tests or vaccinations.
Senator Carlton:
Does this amendment affect presumptive eligibility?
Mr. Coward:
Not a bit. We do not wish to change any protection for the first responders.
Chairman Townsend:
You are defining that a person can be tested annually for hepatitis C and vaccinated or tested for hepatitis A and B? I believe this proposal accommodates flexibility for local government, while still protecting our frontline responders.
Senator Mathews:
The amendment reads, “All blood tests required pursuant to this section must be paid for by the employer.” We want to make sure to include Mr. McAllister’s statement in order to clarify the employer must pay for vaccines and testing.
Chairman Townsend:
Where in current statute does it address coverage? We want to assure people we are not changing the financial responsibility of this process.
Kevin Powers, Committee Counsel:
It is on page 4, line 11, midway through the line. The language in the proposed amendment merely tracks the language already in the statute. The employer must pay for all blood tests required pursuant to this section. As I understand the amendment, all blood tests or vaccinations required pursuant to this section must be paid for by the employer.
Chairman Townsend:
I must suspend the debate to introduce Bill Draft Request (BDR) 54-327.
BILL DRAFT REQUEST 54-327: Revises provisions relating to alcohol and
drug abuse counselors. (Later introduced as Senate Bill 248.)
Chairman Townsend:
This authorizes the Board of Examiners for Alcohol and Drug Abuse Counselors to adopt regulations for issuance of certain certificates as counselors, interns, or specialists, authorizing the board to make certain determination based on information.
SENATOR NEAL MOVED TO INTRODUCE BDR 54-327.
SENATOR O’CONNELL SECONDED THE MOTION.
THE MOTION CARRIED UNANIMOUSLY.
*****
Chairman Townsend:
Now, back to S.B. 184. The language “All blood tests required pursuant to this section must be paid for by the employer” is current law. Is there another section of the law that addresses inoculations?
Ms. Bertuleit:
The Occupational Safety and Health Act requires employers pay for hepatitis B inoculations when they are offered. There is no vaccine for hepatitis C.
Chairman Townsend:
It is already in the law employers must pay for the tests. I believe Mr. McAllister’s point is the one we need to reinforce. On page 4, line 11, you would change to “all blood tests and inoculations required pursuant to this must be paid for by the employer.”
Michael Gillins, Lobbyist, Las Vegas Police Protective Association, and Nevada COPS:
Most all of the major law enforcement agencies in the southern part of the State vaccinate for hepatitis B. We want to include that so everyone gets coverage. No one should be left out of the potential aid a vaccination could allow.
Ronald P. Dreher, Lobbyist, Peace Officers Research Association of Nevada:
I checked with some Reno doctors. I was told everyone should have received the shots already for hepatitis A and B. They do not require yearly testing for hepatitis B unless there is an exposure. There are no additional costs. Hepatitis C would be tested for annually. Our amendment changes some of the other testing dates.
Mr. Powers:
“I need technical clarification. Both of the terms inoculation and vaccination have been used. What is the preferred term? “
Mr. Dreher:
We prefer the term vaccinations.
Mr. Powers:
Do we want the statutory language to require the tests and the vaccination for A and B be upon employment, and then an annual hepatitis C test? Should there be an option for hepatitis A or B test if the employee so chooses if they have previously been vaccinated?
Mr. Dreher:
The answer to those questions is yes. Upon employment, a person would undergo testing for hepatitis A, B, and C. They would again be tested yearly for hepatitis C. They would only be tested for hepatitis B if exposed.
Mr. Powers:
“And then, as a statutory requirement upon employment, the vaccination as well as the testing?”
Mr. Dreher:
Yes, on hepatitis A and B.
Chairman Townsend:
Are we up to speed on these procedures in northern and southern Nevada?
Raymond C. McAllister, Lobbyist, Vice President, Professional Firefighters of Nevada:
Most fire departments are offering vaccinations. My only question to Mr. Powers is would you mandate or offer a vaccination upon employment? You cannot mandate a person to receive a vaccination.
Chairman Townsend:
The employment triggers the conclusive nature of this statute, even if a person has been vaccinated. There is a conclusive presumption a person contracted the disease in the course of employment after he has been employed and vaccinated.
Mr. Powers:
That conclusive presumption is correct. I believe Senator O’Connell asked if the employee declined the vaccination, then how will that affect the statute? I do not believe the statute addresses that issue. I believe the conclusive presumption would still apply to the employee, and they would still be entitled to the hepatitis benefits even if they declined the vaccination.
Chairman Townsend:
This should cover the hepatitis side of the issue. Thank you for your remarks, Senator Mathews. Now, if we could address the other issue.
Senator Carlton:
It is not often we are able to discuss cost savings. However, if we change the language and testing of hepatitis, it would be nice to be able to request a reverse fiscal note to see how much money we might save by adopting this bill.
Mr. Dreher:
Section 4 addresses some of the problems firefighters faced when this bill took effect in the Seventy-first Legislative Session. In our amendment, we changed some of the testing dates. Section 4, subsection 1, begins baseline testing at the scheduled examinations of peace officers on October 1. Under the current statute, the testing could not be done within the time frames. It only allowed for July 1 to August 1, which is insufficient time. We restructured it to set the date at the annual physical exams of peace officers, beginning October 1, 2003, and ending September 30, 2004. This allows a 1-year testing period. Under section 4, subsection 3, paragraph b, we changed the date to January 1, 2005.
Moving back to section 2, subsection 11, we asked to eliminate the specified Clark and Washoe County’s district attorney investigators from the heart and lung provisions and to only include the Washoe County district attorney investigators in the hepatitis C coverage. We based this on testimony heard in this committee and on current information we received. If there are concerns to bring the game wardens into the heart and lung provisions at this time, we will remove them. We might be able to include them in the hepatitis C benefits based on previous testimony regarding game wardens and wildlife workers. We ask to add a section addressing hepatitis C coverage for those people. They would not receive the heart and lung benefits.
Senator Hardy:
Why are the Washoe County district attorney (DA) investigators more exposed than Clark County investigators to hepatitis C? Do you and the Clark County investigators have an agreement on this?
Mr. Dreher:
In talking to the Clark County lobbyists, the Clark County DA investigators do not have the same duties and responsibilities as the Washoe County District Attorney Investigator’s Association. They have stated they do not have the same amount of exposure. I have not spoken to anyone from the Clark County DA investigators. I am going on the information provided to us. We ask legislation be written to separate those agencies by duties and exposures.
Mr. Powers:
“Do you want that to include all hepatitis coverage, or just hepatitis C coverage?”
Mr. Dreher:
I understand they already receive hepatitis B testing and vaccinations. I will refer that to Mr. Neville.
Mr. Powers:
“Whether or not they currently receive testing and vaccinations, in order to enjoy the statutory benefits, they need to be covered regarding all types of hepatitis."
Mr. Gillins:
I submitted a proposal (Exhibit G), addressing removing heart and lung from the language in section 2 and replacing the definition of police officer. We did not want to exclude any individual or group as a matter of economy. Those currently covered by Nevada Revised Statutes (NRS) 617.135 have mechanisms in place for annual physicals and testing processes. Other organizations would have to implement this program at a cost factor. We would like to include those persons not currently covered at a later date. Costs are minimizing with time because of advances in medical treatment. We will be better able to afford adding all law enforcement later, which is our intent.
Senator Hardy:
This is the amendment you worked with Senator Carlton on, correct?
Mr. Gillins:
Correct. I took direction from Senator Carlton and Senator Townsend and tried to combine the desires of both people. Under NRS 617.481, hepatitis A, B, and C are currently covered under workers’ compensation issues for all State employees if an employee can show when the exposure occurred. Baseline testing is done immediately after exposure. We are addressing situations when officers do not know they have been exposed. The majority of exposures are often by body-fluid transfer and known at the time. The employee will file a workers’ compensation claim and get tested according to NRS 617.481. In regards to conclusive presumptive, we are asking to focus on those individuals who do not know they have been exposed. As a detective, I often dealt with suicides. I did not know when or how I was exposed, but the bodily fluids were present. I did not always have the ability to take precautions beforehand. It would be inappropriate to suit up when I had to speak to the surviving family members during a crisis. These are the types of risks that can occur. Domestic violence situations involving battery would also be a risk situation for hepatitis. If an officer does not know he has been exposed, then he is not likely to get tested. This is the purpose of the legislation.
The fiscal note presented was based on the 1 or 2 percent of people who might be infected. These are people who generally do know they have been infected. The percentage of people affected by the conclusive presumptive clause, who do not know they have been infected, is greatly diminished. They deserve to be tested and treated in order to identify the problem, and be treated without transferring it to others. The fiscal notes are for the total potential infections, and not just the conclusive presumptive people who do not know they have been infected.
Chairman Townsend:
Are you suggesting that under hepatitis we want to broaden the bill to include other people, or are you addressing the portion of the bill that creates new officer coverage?
Mr. Gillins:
As a matter of economy, the Nevada Conference of Police and Sheriffs are trying to present a plan which begins to address future additions later. I want everyone to be included in this bill. This involves a big cost, and I am trying to economize in this amendment. As we already have individual groups being tested, adding one more test to the process is a small financial cost. Most of those groups are willing to absorb the cost, especially with the added benefits of the vaccinations. We are minimizing the possibilities of future claims. The amendment is meant to include those people who already have testing in process.
Senator Carlton:
This issue is important to the officers, firefighters, and their families. My suggestion offers testing to police officers currently classified in this section and expands that group to include all law enforcement officers to receive annual testing in the future.
Chairman Townsend:
There are two sections to this bill. One adds police officers to this process, and the other section is an amendment which offers additional hepatitis benefits. Now we are discussing adding additional people to the term of police officer. Those officers currently going through annual physicals should be able to have coverage. Is that correct?
Mr. Gillins:
That is correct.
Chairman Townsend:
Now, to Mr. Dreher, on page 3, section 2, lines 30 to 36, we will discuss game wardens and investigators employed by district attorneys. This is a separate discussion regarding the rights and powers granted to peace officers.
Mr. Dreher:
That is true. We have removed those people from the heart and lung provisions, as addressed in NRS 617.135. Our concern is to add language to allow these groups hepatitis C coverage. The 42 game wardens included in the fiscal note receive the annual physical exams. They do not receive the hepatitis C testing. We would like to add them to hepatitis C testing, only. This would allow the Washoe County district attorney investigators to have the hepatitis C baseline testing now.
Chairman Townsend:
Do we have a fiscal note from Washoe County?
Mr. Dreher:
I provided our amendments to Mr. Slaughter with Washoe County and asked him to review them with risk management.
James Jeppson, Risk Manager, Division of Risk Management, Washoe County:
Our fiscal note was based on the inclusion of police officers and DA investigators for the hepatitis C coverage. We have not carved out just the investigators. It would be a small fraction of the fiscal note we provided earlier.
Chairman Townsend:
We need a fiscal note on the investigators in Washoe County included only for annual hepatitis C test.
Mr. Dreher:
It would cover vaccinations for hepatitis A and B, and baseline testing for hepatitis C for the DA investigators. On an annual basis, the investigators currently do not receive annual physicals. We would remove that portion in order to get them vaccinations for hepatitis A and B, and the baseline testing for hepatitis C.
Chairman Townsend:
Is there anything that prohibits Washoe Country from providing that now?
Mr. Jeppson:
No, there is nothing prohibiting us from providing that now.
Michael B. Neville, Lobbyist, Washoe County DA Investigators Association:
Washoe County does not currently provide testing for DA investigators. I am not sure about testing for the sheriff’s office.
Mr. Powers:
I need to clarify a point. Mr. Dreher refers to the baseline testing and vaccinations. I am assuming you also intend for the Washoe County DA investigators to be included in the statutory benefits and conclusive presumption under NRS 617.485.
Mr. Dreher:
They should be included for purposes of conclusive presumption of hepatitis only.
Senator Carlton:
I am concerned the investigators are not going through the proper chain of command to ask for this. It seems the progression would be to recognize the employee is being exposed to hepatitis A or B, look at the job description, and then come up with a solution. Washoe County does not seem to feel these employees are currently being exposed, or they would be inoculating to protect their employees. These employees are not given annual physicals at this time. It seems odd because normally, in this profession, annual physicals are performed. Apparently the county does not feel this classification of employee needs to go through the physical exams. I am curious how the county sees these employees and their duties. They must look at themselves in a different way than you are looking at them.
Mr. Jeppson:
Washoe County has in place an exposure control program. We have a clinic under contract. Any exposed county employees can submit themselves for testing. This could be a social worker, police officer, investigator, or a probation officer. We have not considered the exposure of the DA investigators to hepatitis. We have 15 investigators on staff. With a national incident rate of 1.8 percent, I would have a difficult time establishing a credible fiscal note for 1.8 percent of 15 people.
Senator Carlton:
What category of police officer are you?
Mr. Neville:
The position itself is a category two peace officer. The majority of incumbents in that position are category one.
Senator Carlton:
It is classified as a category two position, but you were lucky enough to have people with category one status employed there?
Mr. Neville:
Yes. The majority of our people come from line agencies.
Senator Carlton:
Of the people you currently work with, how many would you say have had previous law enforcement experience and enjoy certain privileges from that experience?
Mr. Neville:
Most of our employees have some law enforcement exposure, some of which is limited, but most have extensive exposure in line agency work.
Senator Neal:
Are you proposing to amend NRS 617.481?
Mr. Gillins:
No.
Senator O’Connell:
This section addresses 72-hour notice. The example was given of an officer attending a suicide and not being aware of exposure. Would we not need to change the language, because now the law requires a notification within 72 hours?
Senator Neal:
The screen for contagious disease is within 72 hours of the day of exposure.
Mr. Gillins:
We are not attempting to address NRS 617.481 at all. We feel the bill addresses the issue of unknown exposure. This is why we want the conclusive presumptive clause. The bill is designed to cover those unknowingly exposed people. There is already a process in place for those who may know they have been exposed. We want a conclusive presumptive clause because we have many officers who do not know of exposure.
Senator O’Connell:
We understand. Our concern is about any conflict between the two statutes.
Mr. Gillins:
The fire department has had this process in place since the Seventy-first Legislative Session. To my knowledge, neither your legal counsel nor anyone else has found a conflict.
Mr. Powers:
There are two statutes, NRS 617.481 and NRS 617.485. Both address hepatitis. NRS 617.481 is broader and addresses other contagious diseases. The way the statutes are drafted, NRS 617.485, which currently applies to firemen and emergency medical personnel, is a specific statute that takes precedence over NRS. 617.481 when we are dealing with these specific medical personnel and fireman. If we add police officers, they would enjoy the benefits of NRS 617.485 as well.
Senator O’Connell:
We need this on the record. It appears there is a conflict.
Chairman Townsend:
You are saying under statutory construction, the specific overrides the generic?
Mr. Powers:
“Correct. The NRS 617.485 overrides as it is more specific. Although this is not ideal statutory drafting, it says, ‘notwithstanding any other provision of this chapter’.”
Chairman Townsend:
Under section 2, page 3, you want to remove lines 30 to 36, and change the language to cover game wardens and district attorney investigators for hepatitis C testing.
Mr. Dreher:
Yes. I asked the Legislative Counsel Bureau if it was possible to create sections for that specific language. I was told to come up with the content. When I drafted the language to the original amendment, before removing the game wardens from the heart and lung provisions, we added separate language for the game wardens. We want to add “game wardens to be tested for hepatitis C during their annual physical,” and to add “the district attorney investigators in Washoe County for the inclusion of hepatitis C testing.”
Chairman Townsend:
Using the clarification of generic versus specific language, look at NRS 617.481. It reads, ‘If a person employed in this state … contracts a contagious disease.’ It does not read, ‘employed by the state’. ‘A test to screen for the contagious disease that is administered to the employee 1.) within 72 hours after the date of exposure, and the employee tests negatively for exposure to the contagious disease and, 2.) after the incubation period for the contagious disease, as determined by the state board of health, but not later than 12 months after the date of exposure, and the employee tests positive for exposure to the contagious disease.’ Using that statute, why can those two groups not get covered for hepatitis C?
Senator Carlton:
It would not be presumptive. The point I made earlier with the district attorney investigators is most of them were police officers previously.
Chairman Townsend:
So they are covered anyway?
Senator Carlton:
They are not covered for presumptive.
Senator Hardy:
I heard in testimony a very small percentage of these officers fit into the category of unknowingly exposed? I want to ensure there is a remedy in the law where a person who knows he may have been exposed can still be tested and protected under NRS 617.481. It is a small percentage that needs to be covered under NRS 617.485.
Mr. Gillins:
Correct. The problem is certain law enforcement people move around. They move from job-specific task to job-specific task within their own department.
Senator Hardy:
Please understand me. I agree there are certain categories of police officers that should have presumptive protection. My question is for the other people. You are testifying there are few frontline police officers. I am assuming for the district attorneys there would be a smaller percentage that may not know.
Mr. Gillins:
I believe the percentages would be the same, but because you are dealing with fewer people, the raw numbers will be fewer.
Senator Hardy:
In most cases, the different job description has to be factored in.
Senator Neal:
We have NRS 617.481 as current law. If we attempt to add individuals to that law, are we trying to apply them retroactively?
Mr. Powers:
We are not, Senator Neal. Retroactivity occurs if you were trying to apply a set of circumstances that occurred before the effective date of the bill. This only applies perspectively. If, after the effective date of the bill you have been tested positive for hepatitis, and at that time you have been employed 5 years or more as a police officer, then you are going to enjoy the conclusive presumption that NRS 617.485 provides. That can only occur after the effective date of the bill, so it is perspective in operation. This is a legal issue. The idea is the bill is not retroactive if it relies on antecedent facts to help its operation in the future.
Mr. Dreher:
It is not our intent to make this complex. The Police Officer Research Association does not have a problem removing the district attorney investigators and game wardens from that section. We can continue with the NRS 617.481 presumptive coverage and create a base over the next several years. If it is possible to include these groups at this time, we would like to. If not, we withdraw that amendment.
Chairman Townsend:
My colleagues have articulated the focus on the frontline workers. It does not diminish the efforts of others or the risks they face as school police, capitol police, or others who have come in on this bill. I am concerned about adding any additional groups of people to section 2 at this time. Senator Mathews and those testifying have made compelling arguments on the hepatitis C issues.
Senator O’Connell:
Mr. Powers, you specify 5 years in the statute language. I want to know what happens to the policeman who has not been on the job 5 years. Would we still cover him?
Mr. Powers:
“In that case, if the provisions of NRS 617.485 do not apply, then the provisions of NRS 617.481 will apply.”
Chairman Townsend:
That is an important aspect to understand. There are two statutes to apply, depending on length of employment.
Senator Hardy:
Mr. Gillins, your amendment provides the statutory presumptions under NRS 617.485 for police officers of a specific category, but it would not provide for the others discussed. I agree with Senator Townsend. I do not want to minimize what the other frontline workers are doing. My question is not cost, but rather the concern these individuals are exposed.
Mr. Gillins:
Correct. We are not trying to diminish anyone’s exposures. The intent is to help those people already in the process in order to economize on those organizations.
Senator Hardy:
Does that include frontline police officers and firefighters? We need to include in our motion Mr. Coward’s amendment. Do you have any concerns with that amendment?
Mr. Gillins:
No concerns. I think it is a great idea.
Mr. Powers:
“One last suggestion to the motion, we need to add Mr. Dreher’s changes to the dates.”
Chairman Townsend:
We are looking at three things: the dates, Mr. Coward’s proposal, and the removal of section 2.
SENATOR HARDY MOVED TO AMEND AND DO PASS S.B. 184, THE AMENDMENTS BEING THOSE PRESENTED BY MR. GILLINS, INCLUDING ADDING GAME WARDENS AND INVESTIGATORS WITHIN THE DEFINITION OF POLICE OFFICER AND OMITTING SECTION 2, LINES 3-3 TO 3-36; AND THE AMENDMENT PROVIDED BY MR. COWARD WITH REGARD TO OPTION ON HEPATITIS, AS A). HEPATITIS C SHALL BE TESTED ON AN ANNUAL BASIS AND B). HEPATITIS A AND B VACCINATED OR TESTED ON AN ANNUAL BASIS; AND WITH THE AMENDMENT OFFERED BEFORE REGARDING DATE CHANGES IN SECTION 4.
SENATOR CARLTON SECONDED THE MOTION.
Mr. Powers:
“May I add for the record, we discussed hepatitis C, but the bill would apply to all types of hepatitis?”
THE MOTION CARRIED UNANIMOUSLY.
*****
Chairman Townsend:
We will now open the hearing on S.B. 9.
SENATE BILL 9: Revises provisions governing exclusivity of certain rights and remedies under industrial insurance. (BDR 53-632)
Chairman Townsend:
This was one of the bills resulting from the Legislative Commission’s Subcommittee on Industrial Explosions. It offers a substantial policy change. There have been numerous concerns addressing employers who knowingly break the law resulting in injured or killed employees. How do we crack down on these people who do not want to play by the rules? Currently our law allows an injured worker to sue an uninsured employer under NRS 616B.636. The uninsured employer is deprived of almost all common law defenses. As in Sherburne v. Miller, the employer may not raise such affirmative defenses in a civil action brought by the injured employee. Mr. Powers and Mr. Young created an excellent analysis reminding us that under NRS 616C the injured employee is awarded damages in a civil action. The Division of Industrial Relations is entitled under its right of subrogation to recover any workers’ compensation benefits paid the injured employee. A key issue is the uninsured employer’s fund, which should replace any compensation due, so the uninsured employer would not be taking any rights away from the employee. This committee has tried to focus on providing the safest workplace possible. In 2000, we were awarded a national award for reduction in lost time claims. The testimony heard in the interim subcommittee was compelling. Many bills have stemmed from the subcommittee.
Senator Carlton:
This amendment has not changed since the last committee discussion. I want to amend as a whole S.B. 9. I would like to make clear we are discussing a criminal offense, including plea bargains and sentencing. The district attorney could have looked at the death in the Depressurized Technologies International (DTI) case as a misdemeanor. I do not feel any death in this State should be considered a misdemeanor. This gives the prosecuting attorney direction on how to deal with the death of an employee. As I have said at our previous committee meeting, there are three rungs of the law that applied in the DTI case. The employer knowingly created a condition that was dangerous, preceded; ignored warnings, preceded; and a death occurred. All three rungs of the ladder would have to be climbed before an employer could be taken to court. This seems to comfort most industries. Mr. Bacon is the only person who seems to be uncomfortable with this bill. I am glad he is here to share his viewpoint.
Ray Bacon, Lobbyist, Nevada Manufacturers Association:
We do not want to create a situation where we penalize a fundamentally good employer to get at the bad guy who ignores all laws in place. This is what happened in the DTI case. My concern is a relatively minor Occupational Safety and Health Act (OSHA) infraction could result in a major punishment.
For example, we built a new plant that was a vertical upright, but the specification was not appropriately marked on the plans; therefore, the contractor moved our spray booth by 18 inches. Now the spray booth did not meet specifications. We never knew until we had an OSHA inspection and we were cited. The second incident was a ventilation issue. We were cited as “willful.” Under this bill, had the employee who was injured because she was allergic died, the chief executive officer of our company would have been sent to jail.
John Wiles, Senior Attorney, Legal Section, Division of Industrial Relations, Department of Business and Industry:
I cannot contest the facts of his story, as I am unfamiliar with them. The issue in this statute requires showing a willful violation resulted in a death. In Mr. Bacon’s example, I am not sure whether the link between causation of ventilation issues and the willful violation would be strong. It could be argued in court, I suppose. I can clarify one point. A willful violation requires us to prove a plain indifference. An employer would have to know what he should do, be conscious of the requirements, or have a heightened awareness of those requirements, and still disregard those requirements. We can cite a willful violation on the first visit to a company. It does not require a second violation. DTI is a perfect example. There were no previous violations.
Senator Carlton:
In Mr. Bacon’s example, I do not believe the employer would have climbed the first rung.
Mr. Powers:
Simple negligence or mere inadvertence is not enough to give rise to a willful violation of a criminal statute. Generally, gross negligence is not enough to give rise to a willful violation of a criminal statute. It requires a knowing violation and proceeding with that knowledge, so that a level of intent is involved. You must have knowledge that you are committing the violation, and then you have to proceed with that knowledge to direct the employee to engage in the activity that causes the employee’s death.
Senator Schneider:
This bill bothers me. I was at the Nevada Mining Association’s dinner, and was invited by James Chavez to visit a mine. I said I would like to visit a mine, as I had never been to an underground mine. He told me the mines have had safety problems. He acknowledged safety problems up front. There have to be violations causing these safety problems. They are going to send men underground knowing about safety problems. Those people could be injured or killed. A couple of men were killed recently while mining in Elko. They ran into some underground gas and it killed them. They knowingly sent these workers into a dangerous area. Would they fall under this statute? There are industries in the State that are, by nature, unsafe. How do those employers perform jobs in these industries? It seems that soon we could be sending many people to jail for trying to work in an unsafe environment.
Mr. Wiles:
This amendment affects chapter 618 of the NRS, which is a statutory scheme that is part of the State Occupational and Health Program. The federal government mandates the elements of that scheme for us to qualify for the State plan. This statute, NRS 618.685, is part of that scheme. This parallels the federal Occupational Safety and Health Act. The State plan approvals premise on that statutory scheme. The existing statute is part of a comprehensive program I think the State should maintain in order to remain qualified. In terms of whether this statute has application in a mining setting, the answer is no. Mining is not considered a place of employment, which is regulated under chapter 512 of NRS.
Senator Schneider:
What about the construction industry? A worker could be strapped to a beam of steel on a windy day and if he did not wear the protected gear, he could be injured.
Mr. Wiles:
We have cited willful violations for failure to wear appropriate fall protection in the steel erection industry. We will continue to do so if warranted. We have not pursued a criminal violation of this statute yet, but it is within our authority and the district attorney’s office to do so if warranted.
Mr. Bacon:
When we look at NRS 202.595, which is in the criminal codes, it provides a category C felony that is much broader, and covers all industries and events. It was put into statute because of a skydiving accident, and is a broader statute, and a higher felony conviction level. The DTI case was executed based on this statute. The sentencing issue is a secondary issue. The sentence was agreed upon. For a category C felony, the maximum fine is $10 thousand. They got a repayment to the unemployed insurers fund up to $2 million. If the violator is gone, you will never get any money, but if he is there and running the business, you will. It does qualify as two strikes against him, even though he is in California. We have the ability under existing statute to do what you need to do.
Senator Carlton:
What motivated me to investigate this was the district attorney might have had the opportunity to classify that death as a misdemeanor. I think it is inappropriate a death would ever be a misdemeanor. That initiated this bill. The district attorney did classify it as two class C felonies. The person involved now lives in California. When we send one of our parolees to California through the Interstate Compact Commission, they take over supervision. We have no input for that person’s supervision. He has been punished, doing business and making restitution to the State. He did not serve jail time. I never want to see an instance where the misdemeanor defense could be used. I would like to see the bar raised.
Senator Neal:
Do you represent the injured workers?
Mr. Wiles:
The Division of Industrial Relations is an agency charged with administering chapter 618 of NRS, which is the State OSHA program.
Senator neal:
Where does the phrase willful come from? Willful will be tough to prove. If you said “serious and willful,” then you have a recognized standard that can be proven. If an employer knowingly sent an employee into a tunnel full of African bees without gear, that situation would be serious and willful. But to apply the term willful to the action of the employer would be difficult to prove.
Mr. Wiles:
Yes, the willful standard requires us to show the employer had knowledge of a duty and made a choice to show indifference to that duty.
Senator Neal:
Is that defined somewhere in the statute, or are you referring to common law?
Mr. Wiles:
The willful wording is drawn from the federal Occupational Safety and Health Act.
Senator Neal:
Would you not need to redefine this statute?
Mr. Wiles:
That would not be my recommendation. There is a body of federal common law dealing with occupational safety and health violations that set forth the requirements or standards of the prima fascia case needed to get a conviction on a willful violation.
Senator Neal:
We are dealing with the workers’ compensation area as it applies to exclusive remedy. Exclusive remedy seems to have evolved into a process by which it benefits the employer, not the employee.
Mr. Wiles:
It sounds like a policy question this committee could address.
Senator Neal:
If you are not trying to change exclusive remedy, then why are you here?
Mr. Wiles:
I am here to address the amendment to S.B. 9. There is some overlap in the exclusive remedy provisions and this amendment.
Mr. Powers:
The exclusive remedy provisions of the Industrial Insurance Act apply with regard to the injured employee. The State is not limited to exclusive remedy. The State has multitudes of remedies to deal with the employer that cause a death of an employee. One of those remedies could be administrative fine or penalty while another remedy could be a criminal prosecution. The exclusive remedy provision of the Industrial Insurance Act relates only to the injured employee, not to the power of the State.
Senator Neal:
Do I understand from your statement that none of those are in the law as far as the State is concerned?
Mr. Powers:
“Those remedies are in the law. The State can pursue administrative fines and penalties against an employer who willfully violates.”
Senator Neal:
What is the maximum fine allowed?
Mr. Wiles:
The amendment to S.B. 9 would increase the penalties under this statutory scheme and increase the amount of time served based on the conviction. It increases the penalties and time served based on conviction. In terms of other workers’ compensation provisions, we are limited to an administrative fine up to $10,000 under NRS 616D.120. There are civil penalties under NRS 618 for willful violation. These start out at $70,000.
Senator Neal:
What is lacking in current law that requires us to have this additional language?
Mr. Wiles:
What Senator Carlton intends by this amendment is to ensure no death such as the one at DTI can be classified as a misdemeanor. Because the category of the crime is not specified in NRS 618.685, it could be at the district attorney’s discretion to pursue this as a misdemeanor, instead of a felony. A misdemeanor is described in a certain way under Nevada law, while felonies are defined differently. This statute, at present, does not fit into either category as written. It is written that way based on a federal statute. This proposes to change the wording to make it clear this is a felony. A specific felony with specific fines and penalties attached.
Chairman Townsend:
I would like to encourage Mr. McCormick to visit our subcommittee on industrial relations. Mr. Bacon and anyone else interested is invited. Senator Neal’s question is important. What flexibility is there for the injured person? There is still a concern with leaving the DTI defendant on the street to continue business in order to pay restitution based on his fines to the State. The fact that he was not insured allowed the families and injured parties to sue him in civil court. There is a two-fold issue. He is not earning a living to help these families or the injured parties, and that would be the determination of the court. He is responsible for paying fines to the State. He was found guilty, but the sentencing was suspended for purposes of restitution. Is that correct?
Mr. Wiles:
That is how I understand it. Our expectation is to try to collect all fines, penalties, and claim costs associated with the uninsured employers claim account.
Chairman Townsend:
I understand you would reimburse based on fines, but you can go after him for fines plus the Uninsured Employer’s Fund.
Mr. Wiles:
Correct.
Chairman Townsend:
We will send an official letter of invitation to Mr. McCormick to meet with us next week.
Chairman Townsend:
This meeting is adjourned at 10:07 a.m.
RESPECTFULLY SUBMITTED:
Makita Schichtel,
Committee Secretary
APPROVED BY:
Senator Randolph J. Townsend, Chairman
DATE: