Chapter 385

2003 -- S 0204 SUBSTITUTE A

Enacted 07/31/03

A N A C T

RELATING TO LABOR AND LABOR RELATIONS

Introduced By: Senators DaPonte, Connors, Pichardo, Lanzi, and Ciccone

Date Introduced: January 30, 2003

It is enacted by the General Assembly as follows:

     SECTION 1. Section 28-12-3 of the General Laws in Chapter 28-12 entitled "Minimum

Wages" is hereby amended to read as follows:

28-12-3. Minimum wages. -- Every employer shall pay to each of his or her employees,

commencing July 1, 1999, at least the minimum wage of five dollars and sixty five cents ($5.65)

per hour. Commencing September 1, 2000, the minimum wage is six dollars and fifteen cents

($6.15) per hour.

Commencing January 1, 2004, the minimum wage is six dollars and seventy-five cents

($6.75) per hour.

     SECTION 2. Section 42-64.5-2 of the General Laws in Chapter 42-64.5 entitled "Jobs

Development Act" is hereby amended to read as follows:

42-64.5-2. Definitions. -- As used in this chapter, unless the context clearly indicates

otherwise:

      (1) "Adjusted current employment" means, for any taxable year ending on or after July 1,

1995, the aggregate of the average daily number of full-time equivalent active employees

employed within the State by an eligible company and its eligible subsidiaries during each taxable

year.

      (2) "Affiliated entity" means any corporation owned or controlled by the same persons or

shareholders who own or control an eligible company.

      (3) "Base employment" means the aggregate number of full-time equivalent active

employees employed within the State by an eligible company and its eligible subsidiaries on July

1, 1994, or at the election of the eligible company, on an alternative date as provided by section

42-64.5-5. In the case of a manufacturing company which is ruined by disaster, the aggregate

number of full time equivalent active employees employed at the destroyed facility would be

zero, under which circumstance the base year shall be the calendar year in which the disaster

occurred. Only one base employment period can be elected for purposes of a rate reduction by an

eligible company.

      (4) "Disaster" means an occurrence, natural or otherwise, which results in the destruction

of sixty percent (60%) or more of an operating manufacturing business facility in this state,

thereby making the production of products by the eligible company impossible and as a result

active employees of the facility are without employment in that facility. However, disaster does

not include any damage resulting from the willful act of the owner(s) of the manufacturing

business facility.

      (5) "Eligible subsidiary" means each corporation 80% or more of the outstanding

common stock of which is owned by an eligible company.

      (6) "Eligible company" means any corporation, state bank, federal savings bank, trust

company, national banking association, bank holding company, loan and investment company,

mutual savings bank, credit union, building and loan association, insurance company, investment

company, broker-dealer company, manufacturing company, telecommunications company or

surety company or an eligible subsidiary of any of the foregoing. An eligible company does not

have to be qualified to do business in the state or have any employees in this state at the time its

base employment is determined.

      (7) "Full time equivalent active employee" means any employee of an eligible company

who: (1) works a minimum of 30 hours per week within the State, or two (2) or more part-time

employees whose combined weekly hours equal or exceed 30 hours per week within the State;

and (2) earns no less than 150% of the hourly minimum wage prescribed by Rhode Island law.;

provided, however, for tax years ending after the later of July 1, 2003 and the first tax year that an

eligible company qualifies for a rate reduction pursuant to section 42-64.5-3, for purposes of this

section, one hundred fifty percent (150%) of the hourly minimum wage prescribed by Rhode

Island law shall mean one hundred fifty percent (150%) of the hourly minimum wage prescribed

by Rhode Island law at (a) the time the employee was first treated as a full-time equivalent active

employee during a tax year that the eligible company qualified for a rate reduction pursuant to

section 42-64.5-3, or, if later, (b) the time the employee first earned at least one hundred fifty

percent (150%) of the hourly minimum wage prescribed by Rhode Island law as an employee of

the eligible company.

      (8) (i) "New employment" means for each taxable year the amount of adjusted current

employment for each taxable year minus the amount of base employment, but in no event less

than zero; provided, however, no eligible company is permitted to transfer, assign or hire

employees who are already employed within the State by such eligible company from itself or

any affiliated entity or utilize any other artifice or device for the purpose of artificially creating

new employees in order to qualify for the rate reduction provided for in this chapter.

      (ii) "New employment" shall not include employees already employed in this state who

become employees of an eligible company as a result of an acquisition of an existing company by

purchase, merger, or otherwise, if the existing company was eligible for a rate reduction. In the

case of a manufacturing company that suffers a disaster it shall mean any employment retained or

added as the result of reconstruction of the manufacturing facility.

      (9) "Rate reduction" means the reduction in tax rate specified in section 42-64.5-4.

      (10) "Small business concern" means any eligible company which has a base

employment level of less than one hundred (100); provided, however, that a telecommunications

company may not qualify as a small business concern.

      (11) "State" means the State of Rhode Island and Providence Plantations.

      (12) "Units of new employment" means: (i) for eligible companies which are not small

business concerns, the amount of new employment divided by fifty (50), rounded down to the

nearest multiple of fifty (50), and (ii) for eligible companies which are small business concerns

the amount of new employment divided by ten (10), rounded down to the nearest multiple of ten

(10); provided, however, that an eligible company (other than an eligible company that is a

telecommunications company) with adjusted current employment of one hundred (100) or more

employees in its first year of operation or in any other period following the date its base

employment is determined shall determine its units of new employment by dividing the first one

hundred (100) employees less its base employment by ten (10), rounded down to the nearest

multiple of ten (10), and by dividing the number of additional employees in excess of one

hundred (100) by fifty (50), rounded down to the nearest multiple of fifty (50).

      (13) "Telecommunications Company" means any public service company or corporation

whose rate of taxation is determined under section 44-13-4(4).

     SECTION 3. This act shall take effect on September 1, 2003.

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LC01156/SUB A/3

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