2006 -- H 8203

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LC03402

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STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2006

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A N A C T

RELATING TO LABOR AND PAYMENT OF DEBTS BY CONTRACTORS

     Introduced By: Representative Joseph L. Faria

     Date Introduced: June 07, 2006

     Referred To: House Labor

It is enacted by the General Assembly as follows:

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     SECTION 1. Sections 37-13-12.4 and 37-13-14.1 of the General Laws in Chapter 37-13

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entitled "Labor and Payment of Debts by Contractors" are hereby amended to read as follows:

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     37-13-12.4. Penalty for violations. -- Except as otherwise provided in this chapter, any

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employer who shall violate or fail to comply with any of the provisions of this chapter shall be

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guilty of a misdemeanor and upon conviction thereof shall be punished by a fine of not less than

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fifty five hundred dollars ($50.00)($500) nor more than one hundred thousand dollars

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($100)($1,000) for each separate offense, or by imprisonment for not less than ten (10) nor more

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than ninety (90) days, or by both fine and imprisonment. Each day of failure to pay wages due an

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employee at the time specified in this chapter shall constitute a separate and distinct violation.

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     37-13-14.1. Enforcement -- Hearings. -- (a) Before issuing an order or determination,

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the director of labor and training shall order a hearing thereon at a time and place to be specified,

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and shall give notice thereof, together with a copy of the complaint or the purpose thereof, or a

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statement of the facts disclosed upon investigation, which notice shall be served personally or by

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mail on any person, firm, or corporation affected thereby. The person, firm, or corporation shall

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have an opportunity to be heard in respect to the matters complained of at the time and place

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specified in the notice, which time shall be not less than five (5) days from the service of the

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notice personally or by mail. The hearing shall be held within ten (10) days from the order of

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hearing. The hearing shall be conducted by the director of labor and training or his or her

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designee. The hearing officer in the hearing shall be deemed to be acting in a judicial capacity,

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and shall have the right to issue subpoenas, administer oaths, and examine witnesses. The

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enforcement of a subpoena issued under this section shall be regulated by Rhode Island civil

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practice law and rules. The hearing shall be expeditiously conducted and upon such hearing the

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hearing officer shall determine the issues raised thereon and shall make a determination and enter

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an order within ten (10) days of the close of the hearing, and forthwith serve a copy of the order,

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with a notice of the filing thereof, upon the parties to the proceeding, personally or by mail. The

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order shall dismiss the charges or direct payment of wages or supplements found to be due,

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including interest at the rate of twelve percentum (12%) per annum from the date of the

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underpayment to the date of payment, and may direct payment of reasonable attorney's fees and

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costs to the complaining party.

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      (b) In addition to directing payment of wages or supplements including interest found to

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be due, the order shall also require payment of a further sum as a civil penalty in an amount equal

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to up to three times the total amount found to be due. Further, if the amount of salary owed to an

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employee pursuant to this chapter but not paid to the employee in violation of thereof exceeds

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five thousand dollars ($5,000), it shall constitute a misdemeanor and shall be referred to the office

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of the attorney general. The misdemeanor shall be punishable for a period of not more than one

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year in prison and/or fined not more than one thousand dollars ($1,000). In assessing the amount

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of the penalty, due consideration shall be given to the size of the employer's business, the good

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faith of the employer, the gravity of the violation, the history of previous violations and the

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failure to comply with recordkeeping or other nonwage requirements. The surety of the person,

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firm, or corporation found to be in violation of the provisions of this chapter shall be bound to

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pay any penalties assessed on such person, firm, or corporation. The penalty shall be paid to the

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department of labor and training for deposit in the state treasury; provided, however, it is hereby

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provided that the general treasurer shall establish a dedicated "prevailing wages enforcement

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fund" for the purpose of depositing the penalties paid as provided herein. There is hereby

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appropriated to the annual budget of the department of labor and training the amount of the fund

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collected annually under this section, to be used at the direction of the director of labor and

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training for the sole purpose of enforcing prevailing wage rates as provided in this chapter.

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      (c) For the purposes of this chapter, each day or part thereof of violation of any provision

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of this chapter by a person, firm, or corporation, whether the violation is continuous or

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intermittent, shall constitute a separate and succeeding violation.

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      (d) In addition to the above, any person, firm, or corporation found in willful violation of

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any of the provisions of this chapter by the director of labor and training, an awarding authority,

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or the hearing officer, shall be ineligible to bid on or be awarded work by an awarding authority

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or perform any such work for a period of no less than eighteen (18) months and no more than

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thirty-six (36) months from the date of the order entered by the hearing officer. Once a person,

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firm, or corporation is found to be in violation of this chapter, all pending bids with any awarding

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authority shall be revoked, and any bid awarded by an awarding authority prior to the

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commencement of the work shall also be revoked.

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      (e) In addition to the above, any person, firm, or corporation found to have committed

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two (2) or more willful violations in any period of eighteen (18) months of any of the provisions

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of this chapter by the hearing officer, which violations are not arising from the same incident,

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shall be ineligible to bid on or be awarded work by an awarding authority or perform any work

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for a period of sixty (60) months from the date of the second violation.

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      (f) The order of the hearing officer shall remain in full force and effect unless stayed by

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order of the superior court.

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      (g) The director of labor and training, awarding authority, or hearing officer shall notify

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the bonding company of any person, firm, or corporation suspected of violating any section of

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this chapter. The notice shall be mailed certified mail, and shall enumerate the alleged violations

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being investigated.

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      (h) In addition to the above, any person, firm, or corporation found to have willfully

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made a false or fraudulent representation on certified payroll records shall be referred to the

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office of the attorney general. The false or fraudulent representation shall be considered a

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misdemeanor and shall be punishable for a period of not more than one year in prison and/or

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fined one thousand dollars ($1,000). Further, any person, firm, or corporation found to have

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willfully made a false or fraudulent representation on certified payroll records shall be required to

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pay a civil penalty to the department of labor and training in an amount of no less than two

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thousand dollars ($2,000) and not greater than fifteen thousand dollars ($15,000) per

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representation.

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     SECTION 2. This act shall take effect upon passage.

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LC03402

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N A C T

RELATING TO LABOR AND PAYMENT OF DEBTS BY CONTRACTORS

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     This act would increase fines, and would permit the Department of Labor and Training to

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fine violators of the prevailing wage law without court action. In addition, this act would give the

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Department of Labor and Training discretion when imposing civil penalties for violations of the

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prevailing wage law, and would remove the word willful as it relates to a first violation of the

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prevailing wage law.

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     This act would take effect upon passage.

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LC03402

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