Prohibits certain provisions in certain employment contracts or similar agreements. (BDR 53-116)

A.B. 255

- *AB255*

ASSEMBLY BILL NO. 255–ASSEMBLYMEMBER LA RUE HATCH

FEBRUARY 18, 2025
____________

Referred to Committee on Commerce and Labor

SUMMARY—Prohibits certain provisions in certain employment
contracts or similar agreements. (BDR 53-116)

FISCAL NOTE: Effect on Local Government: No.
Effect on the State: No.

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EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted.

AN ACT relating to employment practices; prohibiting certain
conditions, stipulations and provisions in certain contracts
and agreements that require an employee or independent
contractor to pay a sum of money if the person leaves
employment or ceases prov iding services before the
passage of a specified period; setting forth the manner by
which that prohibition may be enforced; providing
penalties; and providing other matters properly relating
thereto.
Legislative Counsel’s Digest:
Existing law sets forth certain prohibited employment practices. (Chapter 613 1
of NRS) Section 1 of this bill prohibits a contract or other agreement between a 2
private employer and an employee or an independent contractor from including any 3
condition, stipulation or provision that requires the employee or independent 4
contractor to pay to the employer or other person designated by the employer any 5
sum of money if the employee or indepe ndent contractor leaves the employment of 6
the employer or ceases providing services to the employer before the passage of a 7
specified period. Section 1 prohibits an employer from: (1) requesting that an 8
employee, prospective employee or independent contractor enter into a contract 9
or agreement that violates section 1; (2) requiring that a prospective employee or 10
independent contractor enter into such a contract or agreement; (3) executing or 11
attempting to enforce any condition, stipulation or provision of a contract that 12
violates section 1; and (4) obtaining or attempting to obtain a waiver of the 13
provisions of section 1. 14
Section 1 authorizes the Labor Commissioner to impose an administrative fine 15
upon an employer that engages in any of the acts p rohibited by section 1 in an 16
amount of not less than $1,000 and not more than $5,000 for each violation. 17
Section 1 additionally authorizes the Attorney General to bring an action against 18
such an employer seeking an injunction or other equitable relief or a civil penalty of 19

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not less than $1,000 and not more than $5,000 for each violation. Finally, section 1 20
authorizes an employee, prospective employee or independent contractor who is 21
aggrieved by an employer’s viol ation of section 1 to bring an action on his or her 22
own behalf or on behalf of a similarly situated class of persons against the 23
employer to recover or obtain certain relief. 24
Section 2 of this bill applies the provisions of section 1 to any contract or 25
agreement entered into before, on or after October 1, 2025. 26

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN
SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

Section 1. Chapter 613 of NRS is hereby amended by adding 1
thereto a new section to read as follows: 2
1. An employment contract or other agreement between an 3
employer and an employee or a contract or other agreement 4
between an employer and an independent contractor to provide 5
services to the employer must not contain any condition, 6
stipulation or provision that requires the employee o r independent 7
contractor to pay to the employer or other person designated by 8
the employer any sum of money if the employee leaves the 9
employment of the employer or the independent contractor ceases 10
providing services to the employer before the passage of a 11
specified period, regardless of whether the payment is 12
characterized as reimbursement for any training provided, 13
replacement costs, training costs for a replacement employee, lost 14
revenue, liquidated damages or any other substantially similar 15
characterization. 16
2. An employer shall not: 17
(a) Request that a n employee, prospective employee or 18
independent contractor enter into a contract or other agreement 19
that violates subsection 1. 20
(b) Require a prospective employee or independent contractor, 21
as a cond ition of employment or the entering of a contract for 22
services, to enter into a contract or other agreement that violates 23
subsection 1. 24
(c) Execute or attempt to enforce any condition, stipulation or 25
provision of a contract or other agreement that violat es 26
subsection 1. 27
(d) Obtain or attempt to obtain a waiver of the provisions of 28
this section. 29
3. Any condition, stipulation or provision of a contract or 30
other agreement that violates subsection 1 and any waiver of the 31
provisions of this section is contrary to public policy , void and 32
unenforceable. 33

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4. Each act that constitutes a violation of subsection 2 1
constitutes a separate violation. 2
5. In addition to any other penalty, the Labor Commissioner 3
may impose against an employer who violates subs ection 2 an 4
administrative fine of not less than $1,000 and not more than 5
$5,000 for each violation. If the Labor Commissioner imposes an 6
administrative fine pursuant to this subsection, the Labor 7
Commissioner may recover the costs of the proceeding, inclu ding, 8
without limitation, investigative costs and reasonable attorney’s 9
fees. 10
6. In addition to any other penalty, the Attorney General may 11
bring an action in the name of the State of Nevada against an 12
employer who violates subsection 2 seeking an injun ction or other 13
equitable relief or a civil penalty of not less than $1,000 and not 14
more than $5,000 for each violation. If the Attorney General 15
prevails in such an action, the Attorney General is entitled to 16
recover the costs of the proceeding, including, without limitation, 17
investigative costs and reasonable attorney’s fees. 18
7. An employee, prospective employee or independent 19
contractor aggrieved by an employer’s violation of subsection 2 20
may bring an action on his or her own behalf or on behalf of a 21
similarly situated class of persons against the employer to recover 22
or obtain: 23
(a) Actual damages; 24
(b) Additional statutory damages of $5,000 for each violation; 25
(c) An injunction or other equitable relief; and 26
(d) Reasonable attorney’s fees and costs. 27
8. The Labor Commissioner may adopt regulations to carry 28
out the provisions of this section. 29
9. The provisions of this section do not apply to any 30
condition, stipulation or provision in a contract or other 31
agreement that provides for the repayment of any cash advance or 32
money paid as prepayment for services to be provided. 33
10. As used in this section, “employer” does not include a 34
public employer. 35
Sec. 2. The provisions o f this act apply to any contract or 36
agreement entered into before, on or after October 1, 2025. 37

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