Pennsylvania House Bill HB405

Pennsylvania 2025-2026 Regular Session

• Introduced: 1/29/25
• Refer: 1/29/25

Caption

In general provisions relating to business corporations, providing for eligibility for receipt of State resources.

Impact

If enacted, HB 405 would significantly impact how large corporations interact with state resources in Pennsylvania. This legislation aims to incentivize corporate compliance with labor laws and fair practices by limiting access to state contracts and funding for non-compliant entities. It could lead to enhanced labor standards across the state by compelling corporations to adhere to existing laws, thereby fostering a more equitable workplace environment. Additionally, the requirement for employee representation on boards may change corporate governance structures across the state, promoting a culture of accountability and inclusion.

Summary

House Bill 405 seeks to amend Title 15 of the Pennsylvania Consolidated Statutes by introducing new provisions related to the eligibility of domestic and foreign business corporations for state resources. The bill stipulates that corporations with 200 or more employees may be ineligible for state contracts, funding, or grants if they have violated federal labor standards, been found guilty of unfair labor practices, or breached the Pennsylvania Prevailing Wage Act within the past five years. Furthermore, the corporations must have governing boards that include at least 20% current employees elected by their peers, ensuring employee representation at a corporate governance level.

Sentiment

The sentiment around HB 405 appears to be cautiously optimistic among its supporters, who view it as a necessary measure to enhance corporate responsibility and protect the rights of workers. Advocates argue that by enforcing labor standards and ensuring employee voices in governance, the bill addresses significant gaps in corporate accountability. However, concerns have been raised by opponents who fear that the additional restrictions on state funding could deter businesses from operating in Pennsylvania, thus negatively impacting economic growth and employment opportunities in the state.

Contention

Notable points of contention include the potential unintended consequences of limiting access to state resources for large employers, particularly during times of economic restraint. Opponents argue that these restrictions may lead to decreased investment in the state as corporations seek to avoid regulatory hurdles. Additionally, the board composition requirement has sparked debate about governance best practices and the feasibility of enforcing employee representation in larger corporate structures. The balance between enforcing labor standards and promoting a favorable business climate remains a critical focal point of discussion surrounding this legislation.