2019 -- S 0510

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LC001867

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2019

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A N   A C T

RELATING TO LABOR AND LABOR RELATIONS - PAYMENT OF WAGES -

VIOLATIONS

     Introduced By: Senators Lynch Prata, Ruggerio, McCaffrey, Goodwin, and Ciccone

     Date Introduced: February 27, 2019

     Referred To: Senate Labor

     It is enacted by the General Assembly as follows:

     SECTION 1. Sections 28-14-17, 28-14-19, 28-14-19.1 and 28-14-19.2 of the General

Laws in Chapter 28-14 entitled "Payment of Wages" are hereby amended to read as follows:

     28-14-17. Penalty for violations.

     (a) Any employer who violates or fails to comply with any of the provisions of this

chapter shall be guilty of a misdemeanor, and upon conviction of the misdemeanor, the employer

shall be punished by a fine of not less than four hundred dollars ($400) for each separate wage

and hour offense, or by imprisonment of up to one year, or by both fine and imprisonment. A fine

of not less than two thousand dollars ($2,000) for each separate offense shall be imposed on any

employer or entity that misclassifies workers. Each day of failure to pay wages due

misclassification of an employee at the time specified in this chapter shall constitute a separate

and distinct violation.

     (b) Any employer found guilty of violations of this chapter who does not pay wages and

fines within thirty (30) days of a final decision and after notification by the department of labor

and training, may shall have his, her or its business license revoked by the state of Rhode Island

until he, she or it pays such wages and fines in full or enters into a payment agreement with which

he, she or it stays in compliance.

     (c) If any employer is found guilty of violations of this chapter by three (3) separate

judgments on three (3) separate dates within a two (2) year period, the department of labor and

training shall notify any and all government agencies in which the employer is or should be

licensed or registered of the existence of the judgments. Upon receipt of such notice by the

department of labor and training, the board or agency(s) responsible for regulating such employer

shall immediately suspend all the employer's licenses and registrations that allows them to do

business in the state of Rhode Island. The suspension of these licenses or registrations shall

continue for at least three (3) years and until all wages, benefits, or other sums owned have been

paid.

     28-14-19. Enforcement powers and duties of director of labor and training.

     (a) It shall be the duty of the director to insure compliance with the provisions of this

chapter 28-14 and 28-12. The director or his or her designee may investigate any violations

thereof, institute or cause to be instituted actions for the collection of wages and institute action

for penalties or other relief as provided for within and pursuant to those chapters. The director or

his or her authorized representatives are empowered to hold hearings and he or she shall

cooperate with any employee in the enforcement of a claim against his or her employer in any

case whenever, in his or her opinion, the claim is just and valid.

     (b) Upon receipt of a complaint or conducting an inspection under applicable law, the

director or his or her appropriate departmental designee is authorized to investigate to determine

compliance with the chapters 28-12 and/or 28-14.

     (c) With respect to all complaints deemed just and valid, the director or his or her

designee shall order a hearing thereon at a time and place to be specified, and shall give notice

thereof, together with a copy of the complaint or the purpose thereof, or a statement of the facts

disclosed upon investigation, which notice shall be served personally or by mail on any person,

business, corporation, or entity of any kind affected thereby. The hearing shall be scheduled

within thirty (30) days of service of a formal complaint as provided herein. The person, business,

corporation, or entity shall have an opportunity to be heard in respect to the matters complained

of at the time and place specified in the notice. The hearing shall be conducted by the director or

his or her designee. The hearing officer in the hearing shall be deemed to be acting in a judicial

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

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

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

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

an order within thirty (30) days of the close of the hearing, and forthwith serve a copy of the

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

The order shall dismiss the complaint or direct payment of any wages and/or benefits found to be

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due and/or award such other appropriate relief or penalties authorized under chapter 28-12 and/or

28-14, and the order may direct payment of reasonable attorneys' fees and costs to the

complaining party. Interest at the rate of twelve percent (12%) per annum shall be awarded in the

order from the date of the nonpayment to the date of payment.

     (d) The order shall also require payment of a further sum as a civil penalty in an amount

up to two (2) four (4) times the total wages and/or benefits found to be due, exclusive of interest,

which shall be shared equally between the department and the aggrieved party. In determining the

amount of any penalty to impose, the director or his or her designee shall consider the size of the

employer's business, the good faith of the employer, the gravity of the violation, the previous

violations and whether or not the violation was an innocent mistake or willful.

     (e) The director may institute any action to recover unpaid wages or other compensation

or obtain relief as provided under this section with or without the consent of the employee or

employees affected.

     (f) No agreement between the employee and employer to work for less than the

applicable wage and/or benefit rate or to otherwise work under and/or conditions in violation of

applicable law is a defense to an action brought pursuant to this section.

     (g) The director shall notify the contractors' registration board of any order issued or any

determination hereunder that an employer has violated chapters 28-12, 28-14 and/or 37-13. The

director shall notify the tax administrator of any determination hereunder that may affect liability

for an employer's payment of wages and/or payroll taxes.

     28-14-19.1. Misclassification of employees.

     (a) The misclassification of a worker whether performing work as a natural person,

business, corporation, or entity of any kind, as an independent contractor when the worker should

be considered and paid as an employee shall be considered a violation of this chapter.

     (b) In addition to any other relief to which any department or an aggrieved party may be

entitled for such a violation, the employer shall be liable for a civil penalty in an amount not less

than one thousand five hundred dollars ($1,500) and not greater than three thousand dollars

($3,000) for each misclassified employee for a first offense and up to five thousand dollars

($5,000) not less than ten thousand dollars ($10,000) for each misclassified employee for any

subsequent offense, which shall be shared equally between the department and the aggrieved

party.

     (c) In determining the amount of any penalty imposed under this section, the director or

his or her designee shall consider the size of the employer's business; the good faith of the

employer; the gravity of the violation; the history of previous violations; and whether or not the

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violation was an innocent mistake or willful.

     (d) A violation of this section may be adjudicated under § 28-14-19 and consolidated

with any labor standards violation or under §§ 37-13-14.1 and 37-13-15 and consolidated with

any prevailing wage violation.

     (e) A violation of this section may be brought or adjudicated by any division of the

department of labor and training.

     (f) The department shall notify the contractor's registration board and the tax

administrator of any violation of this section.

     28-14-19.2. Private right of action to collect wages or benefits and for equitable

relief.

     (a) Any employee or former employee, or any organization representing such an

employee or former employee aggrieved by the failure to pay wages and/or benefits or

misclassification in violation of chapters 28-12 and/or 28-14 may file a civil action in any court of

competent jurisdiction to obtain relief. An aggrieved party shall be entitled to recover any unpaid

wages and/or benefits, compensatory damages, and liquidated damages in an amount up to two

(2) four (4) times the amount of unpaid wages and/or benefits owed, as well as an award of

appropriate equitable relief, including reinstatement of employment, fringe benefits and seniority

rights, and reasonable attorneys' fees and costs, and/or such other appropriate relief or penalties

authorized under chapters 28-12 and/or 28-14. In determining the amount of any penalty imposed

under this section, consideration shall be given to the size of the employer's business, the good

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

or not the violation was an innocent mistake or willful. Any unpaid fringe benefit contributions

owed pursuant to this section in any form shall be paid to the appropriate benefit fund: however,

in the absence of an appropriate fund, the benefit shall be paid directly to the aggrieved employee.

     (b) An action instituted pursuant to this section may be brought by one or more

employees or former employees individually and/or on behalf of other employees similarly

situated.

     (c) No agreement between the employee and employer to work for less than the

applicable wage and/or benefit rate or to otherwise work under terms and/or conditions in

violation of applicable law is a defense to an action brought pursuant to this section.

     (d) An employer's responsibility and liability hereunder is solely to the employer's own

employees.

     (e) A civil action filed under this section may be instituted instead of, but not in addition

to, the director of labor and training enforcement procedures authorized by the above referenced

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chapters, provided the civil action is filed prior to the date the director of labor and training issues

notice of an administrative hearing.

     (f) The filing of a civil action under this section shall not preclude the director of labor

and training from investigating the matter and/or referring the matter to the attorney general,

contractors ' registration board and/or the tax administrator.

     (g) Any claim hereunder shall be forever barred unless commenced within three (3) years

after the cause of action accrued.

     SECTION 2. This act shall take effect upon passage.

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LC001867

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO LABOR AND LABOR RELATIONS - PAYMENT OF WAGES -

VIOLATIONS

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     This act would increase the possible penalties and damages against employers that violate

certain payment of wage laws.

     This act would take effect upon passage.

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LC001867

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