Second Regular Session Seventy-fourth General Assembly STATE OF COLORADO INTRODUCED LLS NO. 24-0124.02 Yelana Love x2295 HOUSE BILL 24-1008 House Committees Senate Committees Business Affairs & Labor A BILL FOR AN ACT C ONCERNING MEASURES TO EXPAND GENERAL CONTRACTOR101 ACCOUNTABILITY FOR WAGE CLAIMS INVOLVING CONTRACTORS102 IN THE CONSTRUCTION INDUSTRY .103 Bill Summary (Note: This summary applies to this bill as introduced and does not reflect any amendments that may be subsequently adopted. If this bill passes third reading in the house of introduction, a bill summary that applies to the reengrossed version of this bill will be available at http://leg.colorado.gov .) For wage claims brought by individuals working in the construction industry, the bill: ! Requires that a subcontractor that receives a written demand for payment forward a copy of the written demand for payment to the general contractor within 3 business HOUSE SPONSORSHIP Duran and Froelich, Brown, deGruy Kennedy, Epps, Garcia, Hamrick, Hernandez, Joseph, Lieder, Lindstedt, Mabrey, Mauro, Ricks, Rutinel, Story, Velasco, Vigil SENATE SPONSORSHIP Danielson and Jaquez Lewis, Exum, Gonzales, Kolker, Marchman, Sullivan Shading denotes HOUSE amendment. Double underlining denotes SENATE amendment. Capital letters or bold & italic numbers indicate new material to be added to existing law. Dashes through the words or numbers indicate deletions from existing law. days after receipt; ! Specifies that a general contractor and a subcontractor that is a direct employer of an employee are jointly and severally liable for all debts owed based on a wage claim or investigation that are incurred by the subcontractor acting under, by, or for the general contractor; and ! Allows a general contractor to require the following information from each subcontractor acting under, by, or for the general contractor: ! Pay data; ! Contact information; and ! An affidavit attesting to whether the subcontractor has participated in a civil or administrative proceeding within the last 5 years and, if so, the outcome of the proceeding. Be it enacted by the General Assembly of the State of Colorado:1 SECTION 1. In Colorado Revised Statutes, 8-4-101, add (1.5),2 (8.7), (11.5), and (12.5) as follows:3 8-4-101. Definitions. As used in this article 4, unless the context4 otherwise requires:5 (1.5) "C ONSTRUCTION CONTRACT " MEANS AN EXPRESS OR IMPLIED6 AGREEMENT:7 (a) F OR THE CONSTRUCTION , RECONSTRUCTION, ALTERATION,8 MAINTENANCE, MOVING, OR DEMOLITION OF ANY BUILDING, STRUCTURE,9 OR IMPROVEMENT; OR10 (b) R ELATING TO THE EXCAVATION OF OR OTHER DEVELOPMENT11 OF OR IMPROVEMENT TO LAND .12 (8.7) "G ENERAL CONTRACTOR" MEANS ANY PERSON, INCLUDING13 A CONSTRUCTION MANAGER , JOINT VENTURE, OR ANY COMBINATION14 THEREOF, ALONG WITH THE PERSON'S SUCCESSORS, HEIRS, OR ASSIGNS,15 THAT ENTERS INTO A CONSTRUCTION CONTRACT WITH AN OWNER .16 "G ENERAL CONTRACTOR " INCLUDES AN OWNER THAT ENTERS INTO A17 HB24-1008-2- CONSTRUCTION CONTRACT WITH MORE THAN ONE CONTRACTOR OR1 SUBCONTRACTOR.2 (11.5) "O WNER" MEANS ANY PERSON WITH AN OWNERSHIP3 INTEREST IN REAL PROPERTY , WHETHER THE INTEREST IS IN FEE , AS4 VENDEE UNDER A CONTRACT TO PURCHASE , AS LESSEE, OR ANOTHER5 INTEREST OR ESTATE LESS THAN FEE.6 (12.5) "S UBCONTRACTOR" MEANS ANY PERSON THAT IS A PARTY7 TO AN EXPRESS OR IMPLIED CONTRACT WITH A GENERAL CONTRACTOR OR8 WITH A GENERAL CONTRACTOR 'S SUBCONTRACTORS AT ANY TIER TO9 PERFORM ANY PORTION OF WORK WITHIN THE SCOPE OF THE GENERAL10 CONTRACTOR'S CONSTRUCTION CONTRACT WITH THE OWNER , INCLUDING11 A PERSON THAT HAS NO DIRECT PRIVITY OF CONTRACT WITH THE GENERAL12 CONTRACTOR.13 SECTION 2. In Colorado Revised Statutes, 8-4-109, add (3)(a.3)14 as follows:15 8-4-109. Termination of employment - payments required -16 civil penalties - payments to surviving spouse or heir. (3) (a.3) (I) I F17 AN EMPLOYER THAT RECEIVES A WR ITTEN DEMAND FOR PAYMENT UNDER18 SUBSECTION (3)(a) OF THIS SECTION IS A SUBCONTRACTOR, THE EMPLOYER19 SHALL FORWARD A COPY OF THE WRITTEN DEMAND FOR PAYMENT TO THE20 GENERAL CONTRACTOR WITHIN THREE BUSINESS DAYS AFTER RECEIVING21 THE WRITTEN DEMAND . THE EMPLOYER SHALL ALSO SIMULTANEOUSLY22 SEND TO THE WAGE CLAIMANT A COPY OF THE CORRESPONDENCE SENT TO23 THE GENERAL CONTRACTOR AND THE GENERAL CONTRACTOR 'S NAME AND24 ADDRESS.25 (II) A N EMPLOYER THAT FAILS TO FORWARD A WRITTEN DEMAND26 FOR PAYMENT TO A GENERAL CONTRACTOR AS REQUIRED IN SUBSECTION27 HB24-1008 -3- (3)(a.3)(I) OF THIS SECTION IS SUBJECT TO A FINE OF TWO THOUSAND1 DOLLARS, PAID TO THE GENERAL CONTRACTOR , IN ADDITION TO ANY2 AMOUNTS OWED PURSUANT TO SECTION 8-4-110.5 OR ANY OTHER LAW.3 SECTION 3. In Colorado Revised Statutes, add 8-4-110.5 as4 follows:5 8-4-110.5. General contractor responsibility for wage claims6 in the construction industry. (1) (a) A GENERAL CONTRACTOR AND A7 SUBCONTRACTOR THAT IS A DIRECT EMPLOYER OF AN EMPLOYEE HAVE8 JOINT AND SEVERAL LIABILITY FOR ALL DEBTS OWED , BASED ON A WAGE9 CLAIM OR INVESTIGATION AND PURSUANT TO A JUDICIAL OR10 ADMINISTRATIVE ORDER, THAT ARE INCURRED BY THE SUBCONTRACTOR11 ACTING UNDER, BY, OR FOR THE GENERAL CONTRACTOR .12 (b) U NLESS OTHERWISE PROVIDED BY LAW , AFTER A JUDGMENT,13 WAGE DETERMINATION , OR HEARING OFFICER DECISION HAS BEEN14 ENTERED, PROPERTY OF THE GENERAL CONTRACTOR MAY BE ATTACHED15 FOR THE PAYMENT OF ANY DEBT D ETERMINED TO BE OWED , BASED ON A16 WAGE CLAIM OR INVESTIGATION AND PURSUANT TO A JUDICIAL OR17 ADMINISTRATIVE ORDER, BY A SUBCONTRACTOR ACTING UNDER , BY, OR18 FOR THE GENERAL CONTRACTOR .19 (2) P URSUANT TO SUBSECTION (1)(a) OF THIS SECTION, A20 SUBCONTRACTOR SHALL INDEMNIFY A GENERAL CONTRACTOR FOR ALL21 AMOUNTS PAID AS A RESULT OF THE SUBCONTRACTOR 'S VIOLATION UNLESS22 THE VIOLATION IS DUE TO THE GENERAL CONTRACTOR 'S LACK OF PAYMENT23 TO THE SUBCONTRACTOR IN ACCORDANCE WITH THE TERMS OF THE24 CONTRACT BETWEEN THE GENERAL CONTRACTOR AND THE25 SUBCONTRACTOR.26 (3) A GENERAL CONTRACTOR MAY REQUIRE THE FOLLOWING27 HB24-1008 -4- INFORMATION FROM EACH SUBCONTRACTOR ACTING UNDER , BY, OR FOR1 THE GENERAL CONTRACTOR :2 (a) P AY DATA SHOWING THE HOURS WORKED , PAY, OVERTIME, AND3 DEDUCTIONS FOR EACH INDIVIDUAL WORKER ENGAGED BY THE4 SUBCONTRACTOR, REGARDLESS OF WHETHER THE INDIVIDUAL WORKER IS5 CLASSIFIED AS AN EMPLOYEE OR AN INDEPENDENT CONTRACTOR 'S6 INDIVIDUAL LABORER. THE SUBCONTRACTOR SHALL REDACT THESE7 RECORDS TO DISCLOSE ONLY THE LAST FOUR DIGITS OF THE INDIVIDUAL8 WORKER'S SOCIAL SECURITY NUMBER OR INDIVIDUAL TAXPAYER9 IDENTIFICATION NUMBER.10 (b) C ONTACT INFORMATION FOR ALL ADDITIONAL11 SUBCONTRACTORS THAT PERFORM ANY PORTION OF WORK WITHIN THE12 SCOPE OF THE SUBCONTRACTOR 'S CONTRACT WITH THE GENERAL13 CONTRACTOR OR WITH ANOTHER SUBCONTRACTOR THAT IS IN PRIVITY OF14 CONTRACT WITH THE GENERAL CONTRACTOR ; AND15 (c) (I) A N AFFIDAVIT ATTESTING TO WHETHER THE16 SUBCONTRACTOR OR ANY OF ITS CURRENT PRINCIPALS HAS PARTICIPATED17 IN ANY CIVIL OR ADMINISTRATIVE PROCEEDING WITHIN THE PRECEDING18 FIVE YEARS THAT INVOLVED ANY ALLEGATIONS OF A WAGE AND HOUR19 VIOLATION AGAINST THE SUBCONTRACTOR OR PRINCIPAL UNDER LOCAL ,20 STATE, OR FEDERAL LAW; AND21 (II) I F THE PROCEEDING IS COMPLETE , THE OUTCOME OF THE22 PROCEEDING, INCLUDING ANY DAMAGES , FEES, OR PENALTY AMOUNTS23 PAID TO WORKERS OR TO A GOVERNMENT AGENCY .24 (4) A SUBCONTRACTOR'S FAILURE TO COMPLY WITH THIS SECTION25 DOES NOT RELIEVE A GENERAL CONTRACTOR FROM LIABILITY UNDER26 SUBSECTION (1) OF THIS SECTION.27 HB24-1008 -5- (5) (a) NOTHING IN THIS SECTION DIMINISHES THE RIGHTS ,1 PRIVILEGES, OR REMEDIES OF ANY EMPLOYEE UNDER ANY COLLECTIVE2 BARGAINING AGREEMENT .3 (b) A COLLECTIVE BARGAINING AGREEMENT MAY WAIVE THE4 REQUIREMENTS OF THIS SECTION IF THE AGREEMENT :5 (I) I S ENTERED INTO BY A BONA FIDE BUILDING AND6 CONSTRUCTION TRADE LABOR ORGANIZATION THAT HAS ESTABLISHED7 ITSELF OR ITS AFFILIATES AS THE COLLECTIVE BARGAINING8 REPRESENTATIVE FOR PERSONS PERFORMING WORK ON A PROJECT ;9 (II) E XPLICITLY REFERENCES THIS SECTION; AND10 (III) D OES NOT DIMINISH OR IMPAIR THE RIGHTS OF AN EMPLOYEE11 PROVIDED UNDER ANY OTHER SECTION OF THIS ARTICLE 4.12 SECTION 4. Applicability. This act applies to wage claims13 brought and investigations commenced on or after the effective date of14 this act.15 SECTION 5. Safety clause. The general assembly finds,16 determines, and declares that this act is necessary for the immediate17 preservation of the public peace, health, or safety or for appropriations for18 the support and maintenance of the departments of the state and state19 institutions.20 HB24-1008 -6-