OFFICE OF FISCAL ANALYSIS
Legislative Office Building, Room 5200
Hartford, CT 06106 (860) 240-0200
http://www.cga.ct.gov/ofa
SB-418
AN ACT CONCERNING WAGE THEFT.
Primary Analyst: CW 3/30/22
Contributing Analyst(s): MR
Reviewer: MM
OFA Fiscal Note
State Impact:
Agency Affected Fund-Effect FY 23 $ FY 24 $
Labor Dept. GF - Cost 81,819 109,986
State Comptroller - Fringe
Benefits
1
GF - Cost 31,135 42,551
Labor Dept. GF - Potential
Revenue Gain
Up to
375,000
Up to
500,000
Note: GF=General Fund
Municipal Impact: None
Explanation
The bill, which creates additional penalties and establishes a flat fine
for failure by contractors and subcontractors to pay workers the
required prevailing wage, results in: 1) a cost to the Department of Labor
(DOL) of $112,954 in FY 23 (partial year) and $152,536 in FY 24, and 2) a
potential General Fund revenue gain from fines estimated at up to
$375,000 in FY 23 (partial year) and up to $500,000 in FY 24.
2
It is anticipated that up to 200 citations would be issued each year
based on the actual number of investigations in 2020 and 2021. In order
1
The fringe benefit costs for most state employees are budgeted centrally in accounts
administered by the Comptroller. The estimated active employee fringe benefit cost
associated with most personnel changes is 40.53% of payroll in FY 23.
2
Under current law, the labor commissioner may issue fines ranging from $2,500 to
$5,000 per violation; the bill establishes a flat rate of $5,000 per violation.
Consequently, the revenue gain is dependent on how many violations would be
assessed at an amount lower than $5,000. 2022SB-00418-R000253-FN.DOCX Page 2 of 2
to accommodate the number of administrative hearings that would
occur, DOL would require one additional Staff Attorney at an
annualized cost of $152,536 ($104,986 for salary and $42,551 for fringe
benefit costs), including $5,000 in associated overhead costs (computer,
office supplies, etc.).
For contractors or subcontractors that have more than one violation
within a five-year period the bill also requires DOL to refer contractors
who violate the bill's provisions to the attorney general, who may start
a civil lawsuit to recover any unpaid wages, plus interest. This is not
anticipated to have a fiscal impact as the Office of the Attorney General
has the necessary expertise to handle this provision.
The Out Years
The annualized ongoing fiscal impact identified above would
continue into the future subject to inflation.