EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
*sb0938*
SENATE BILL 938
K3, P1, P2 5lr3237
CF HB 1096
By: The President (By Request – Office of the Attorney General)
Introduced and read first time: January 28, 2025
Assigned to: Finance
A BILL ENTITLED
AN ACT concerning 1
Fraud Prevention and Worker Protections – Prohibitions, Penalties, and 2
Enforcement 3
FOR the purpose of altering the claims to which the Maryland False Claim Act (MFCA) 4
applies; prohibiting a person from knowingly making or using, or causing to be made 5
or used, a false record or statement resulting in underpayments of unemployment 6
insurance contributions or payment of unemployment insurance benefits of more 7
than a certain amount; requiring the Comptroller to deposit into the Unemployment 8
Insurance Fund certain civil penalties or damages collected under the MFCA; 9
requiring that certain civil penalties and damages be used in a certain manner if a 10
violation of the MFCA involves the failure to pay prevailing wage rates; altering the 11
enforcement mechanisms of the Maryland Wage and Hour Law, the Maryland Wage 12
Payment and Collection Law, workplace fraud laws, living wage laws, and prevailing 13
wage laws; altering the circumstances under which a person may be debarred under 14
State procurement law; altering the application of certain provisions of law 15
governing workplace fraud; providing that general contractors and higher–tiered 16
contracts are considered to be employers of certain workers under the workplace 17
fraud laws; altering the test used to determine if an employer–employee relationship 18
is created for purposes of workplace fraud; providing that workplace fraud laws 19
cannot be waived or set aside by private agreement; establishing that a certain 20
agreement is not a defense to a citation or in a civil action brought under the 21
workplace fraud laws; requiring a licensing authority to revoke or suspend the 22
license of a licensee for a certain workplace fraud violation under certain 23
circumstances; establishing the Worker Protection Unit in the Office of the Attorney 24
General to protect workers’ rights in the State and enforce certain worker protection 25
laws; and generally relating to fraud prevention and workers’ protections. 26
BY repealing 27
Article – Labor and Employment 28
Section 3–903.1 and 3–904 through 3–909 29
Annotated Code of Maryland 30 2 SENATE BILL 938
(2016 Replacement Volume and 2024 Supplement) 1
BY renumbering 2
Article – Labor and Employment 3
Section 3–903, 3–910, 3–911, 3–913 through 3–915, and 3–917 through 3–920 4
to be Section 3–904, 3–912, 3–913, 3–915 through 3–917, and 3–918 through 3–921, 5
respectively 6
Annotated Code of Maryland 7
(2016 Replacement Volume and 2024 Supplement) 8
BY repealing and reenacting, without amendments, 9
Article – General Provisions 10
Section 8–101(a) and 8–102(c) 11
Annotated Code of Maryland 12
(2019 Replacement Volume and 2024 Supplement) 13
BY repealing and reenacting, with amendments, 14
Article – General Provisions 15
Section 8–101(b), 8–102(a) and (b)(8) and (9), and 8–109(c) 16
Annotated Code of Maryland 17
(2019 Replacement Volume and 2024 Supplement) 18
BY adding to 19
Article – General Provisions 20
Section 8–102(b)(9) 21
Annotated Code of Maryland 22
(2019 Replacement Volume and 2024 Supplement) 23
BY repealing and reenacting, with amendments, 24
Article – Labor and Employment 25
Section 3–101, 3–427, 3–507.2, 3–901, and 3–902 26
Annotated Code of Maryland 27
(2016 Replacement Volume and 2024 Supplement) 28
BY adding to 29
Article – Labor and Employment 30
Section 3–903, 3–905 through 3–911, and 3–914 31
Annotated Code of Maryland 32
(2016 Replacement Volume and 2024 Supplement) 33
BY repealing and reenacting, with amendments, 34
Article – Labor and Employment 35
Section 3–904, 3–912, 3–913, and 3–915(a) 36
Annotated Code of Maryland 37
(2016 Replacement Volume and 2024 Supplement) 38
(As enacted by Section 2 of this Act) 39
SENATE BILL 938 3
BY repealing and reenacting, with amendments, 1
Article – State Finance and Procurement 2
Section 16–203(a)(9) and (10), 17–224, and 18–109 3
Annotated Code of Maryland 4
(2021 Replacement Volume and 2024 Supplement) 5
BY adding to 6
Article – State Government 7
Section 6–1001 through 6–1010 to be under the new subtitle “Subtitle 10. Worker 8
Protection Unit” 9
Annotated Code of Maryland 10
(2021 Replacement Volume and 2024 Supplement) 11
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MAR YLAND, 12
That Section(s) 3–903.1 and 3–904 through 3–909 of Article – Labor and Employment of 13
the Annotated Code of Maryland be repealed. 14
SECTION 2. AND BE IT FURTHER ENACTED, That Section(s) 3 –903, 3–910, 15
3–911, 3–913 through 3–915, and 3–917 through 3–920 of Article – Labor and Employment 16
of the Annotated Code of Maryland be renumbered to be Section(s) 3–904, 3–912, 3–913, 17
3–915 through 3–917, and 3–918 through 3–921, respectively. 18
SECTION 3. AND BE IT FURTHER ENACTED, That the Laws of Maryland read 19
as follows: 20
Article – General Provisions 21
8–101. 22
(a) In this title the following words have the meanings indicated. 23
(b) (1) “Claim” means a request or demand, under a contract or otherwise, for 24
money or other property, whether or not the governmental entity has title to the money or 25
property, that is: 26
(i) presented to an officer, employee, or agent of a governmental 27
entity; or 28
(ii) made to a contractor, a grantee, or another recipient, if the 29
money or other property is to be spent or used on a governmental entity’s behalf or to 30
advance an interest of a governmental entity, and the governmental entity: 31
1. provides or has provided any portion of the money or other 32
property requested or demanded; or 33
2. will reimburse the contractor, grantee, or other recipient 34
for any portion of the money or other property that is requested or demanded. 35 4 SENATE BILL 938
(2) “Claim” does not include requests or demands for money or other 1
property MADE BY AN INDIVIDUA L BENEFICIARY that a governmental entity has paid to 2
[an] THE individual as compensation for employment or as an income subsidy with no 3
restrictions on that individual’s use of the money or other property. 4
8–102. 5
(a) [This] EXCEPT AS PROVIDED IN SUBSECTION (B)(9) OF THIS SECTION , 6
THIS section does not apply to claims, records, or statements related to State or local taxes. 7
(b) A person may not: 8
(8) knowingly conceal, or knowingly and improperly avoid or decrease, an 9
obligation to pay or transmit money or other property to a governmental entity, including 10
misrepresenting the time at which a trade was made to make the transaction appear less 11
favorable; [or] 12
(9) KNOWINGLY MAKE , USE, OR CAUSE TO BE MADE OR USED A FALSE 13
RECORD OR STATEMENT RESULTING IN: 14
(I) THE UNDERPAYMENT OF CONTRIBUTIONS OWED TO THE 15
UNEMPLOYMENT INSURANCE FUND; OR 16
(II) THE PAYMENT OF UNEMP LOYMENT INSURANCE BE NEFITS 17
OF MORE THAN $15,000 IN A CALENDAR YEAR ; OR 18
[(9)] (10) knowingly make any other false or fraudulent claim against a 19
governmental entity. 20
(c) (1) A person that is found to have violated subsection (b) of this section is 21
liable to the governmental entity for: 22
(i) a civil penalty of not more than $10,000 for each violation; and 23
(ii) an additional amount of not more than three times the amount 24
of damages that the governmental entity sustains as a result of the acts of that person in 25
violation of subsection (b) of this section. 26
(2) The total amount owed by a person under paragraph (1) of this 27
subsection may not be less than the amount of the actual damages the governmental entity 28
incurs as a result of the person’s violation of subsection (b) of this section. 29
8–109. 30
SENATE BILL 938 5
(c) (1) Except as provided under paragraph (2) of this subsection, the 1
Comptroller shall deposit any civil penalty or damages collected by the State under this 2
title into the General Fund of the State. 3
(2) (i) If a violation of this title affects any of the following funds, the 4
Comptroller shall deposit any civil penalty or damages collected by the State under this 5
title into the affected fund: 6
1. a fund that is not subject to § 7–302 of the State Finance 7
and Procurement Article; 8
2. a special fund requiring the reversion of appropriated 9
funds to the special fund under § 7–304 of the State Finance and Procurement Article; 10
3. a fund under the jurisdiction of the Board of Trustees for 11
the State Retirement and Pension System; [or] 12
4. a fund under the jurisdiction of the State Employee and 13
Retiree Health and Welfare Benefits Program; OR 14
5. THE UNEMPLOYME NT INSURANCE FUND. 15
(ii) If more than one fund is affected by a violation of this title, the 16
Comptroller shall deposit any civil penalty or damages collected by the State into the 17
appropriate fund or the General Fund of the State on a pro rata basis. 18
(III) IF A VIOLATION OF THI S TITLE INVOLVES THE FAILURE TO 19
PAY PREVAILING WAGE RATES IN ACCORDANCE WITH TITLE 17, SUBTITLE 2 OF THE 20
STATE FINANCE AND PROCUREMENT ARTICLE, CIVIL PENALTIES AND DAMAGES 21
COLLECTED UNDER THIS TITLE SHALL BE USED TO PAY RESTITU TION DIRECTLY TO 22
AFFECTED WORKERS . 23
Article – Labor and Employment 24
3–101. 25
(a) In this title the following words have the meanings indicated. 26
(b) “ATTORNEY GENERAL” MEANS THE ATTORNEY GENERAL OF 27
MARYLAND, OR THE ATTORNEY GENERAL’S AUTHORIZED REPRESE NTATIVE. 28
(C) “Commissioner” means the Commissioner of Labor and Industry, OR THE 29
COMMISSIONER ’S AUTHORIZED REPRESE NTATIVE. 30
[(c)] (D) (1) “Employ” means to engage an individual to work. 31
6 SENATE BILL 938
(2) “Employ” includes: 1
(i) allowing an individual to work; and 2
(ii) instructing an individual to be present at a work site. 3
3–427. 4
(a) (1) If an employer pays an employee less than the wage required under this 5
subtitle, the employee may bring an action against the employer to recover: 6
[(1)] (I) the difference between the wage paid to the employee and the 7
wage required under this subtitle; 8
[(2)] (II) an additional amount equal to the difference between the wage 9
paid to the employee and the wage required under this subtitle as liquidated damages; and 10
[(3)] (III) counsel fees and other costs. 11
[(b)] (2) On the written request of an employee who is entitled to bring an action 12
under this section, the Commissioner may: 13
[(1)] (I) take an assignment of the claim in trust for the employee; 14
[(2)] (II) ask the Attorney General to bring an action in accordance with 15
this section on behalf of the employee; and 16
[(3)] (III) consolidate [2] TWO or more claims against an employer. 17
(3) (I) IF A COURT DETERMINES THAT AN EMPLOYEE IS ENTITLED 18
TO RECOVERY IN AN AC TION UNDER THIS SECT ION, THE COURT SHALL AWAR D TO 19
THE EMPLOYEE : 20
1. THE DIFFERENCE BETWE EN THE WAGE PAID TO THE 21
EMPLOYEE AND THE WAG E REQUIRED UNDER THI S SUBTITLE; 22
2. EXCEPT AS PROVIDED I N SUBPARAGRAPH (II) OF THIS 23
PARAGRAPH , AN ADDITIONAL AMOUNT EQUAL TO THE DIFFERE NCE BETWEEN THE 24
WAGE PAID TO THE EMP LOYEE AND THE WAGE R EQUIRED UNDER THIS S UBTITLE AS 25
LIQUIDATED DAMAGES ; AND 26
3. REASONABLE COUNSEL F EES AND OTHER COSTS. 27
(II) IF AN EMPLOYER SHOWS TO THE SATISFACTION OF THE 28
COURT THAT THE EMPLO YER ACTED IN GOOD FA ITH AND REASONABLY B ELIEVED 29 SENATE BILL 938 7
THAT THE WAGES PAID TO THE EMPLOYEE WERE NOT LESS THAN THE WA GE 1
REQUIRED UNDER THIS SUBTITLE, THE COURT SHALL : 2
1. DETERMINE THAT LIQUI DATED DAMAGES SHOULD 3
NOT BE AWARDED ; OR 4
2. AWARD AS LIQUIDATED DAMAGES ANY AMOUNT L ESS 5
THAN THE AMOUNT SPEC IFIED IN SUBPARAGRAP H (I)2 OF THIS PARAGRAPH . 6
(B) (1) THE ATTORNEY GENERAL MAY BRING AN ACTION AGAINST AN 7
EMPLOYER ON BEHALF OF AN EMPLOYE E IF: 8
(I) THE EMPLOYER PAYS 10 OR MORE EMPLOYEES LE SS THAN 9
THE WAGE REQUIRED UN DER THIS SUBTITLE ; OR 10
(II) THE TOTAL AMOUNT OF WAGES UNDERPAID FOR ALL 11
AFFECTED EMPLOYEES I S $25,000 OR GREATER. 12
(2) IN AN ACTION BROUGHT UNDER PARAGRAPH (1) OF THIS 13
SUBSECTION, THE ATTORNEY GENERAL MAY RECOVER : 14
(I) THE DIFFERENCE BETWE EN THE WAGES PAID TO THE 15
EMPLOYEES AND THE WA GE REQUIRED UNDER TH IS SUBTITLE; 16
(II) AN ADDITIONAL AMOUNT EQUAL TO THE DIFFERE NCE 17
BETWEEN THE WAGES PA ID TO THE EMPLOYEES AND THE WAGE REQUIRED UNDER 18
THIS SUBTITLE AS LIQ UIDATED DAMAGES ; 19
(III) A CIVIL PENALTY OF $5,000 FOR EACH VIOLATION P AYABLE 20
INTO THE GENERAL FUND OF THE STATE; 21
(IV) REASONABLE ATTORNEY ’S FEES AND OTHER COS TS 22
PAYABLE TO THE ATTORNEY GENERAL; AND 23
(V) ANY OTHER APPROPRIAT E RELIEF. 24
(3) BEFORE INITIATING AN ACTION UNDER THIS SE CTION, THE 25
ATTORNEY GENERAL MAY CONDUCT A N INVESTIGATION . 26
(c) The agreement of an employee to work for less than the wage to which the 27
employee is entitled under this subtitle is not a defense to an action under this section. 28
[(d) (1) If a court determines that an employee is entitled to recovery in an 29
action under this section, the court shall award to the employee: 30 8 SENATE BILL 938
(i) the difference between the wage paid to the employee and the 1
wage required under this subtitle; 2
(ii) except as provided in paragraph (2) of this subsection, an 3
additional amount equal to the difference between the wage paid to the employee and the 4
wage required under this subtitle as liquidated damages; and 5
(iii) reasonable counsel fees and other costs. 6
(2) If an employer shows to the satisfaction of the court that the employer 7
acted in good faith and reasonably believed that the wages paid to the employee were not 8
less than the wage required under this subtitle, the court shall: 9
(i) determine that liquidated damages should not be awarded; or 10
(ii) award, as liquidated damages, any amount less than the amount 11
specified in paragraph (1)(ii) of this subsection.] 12
3–507.2. 13
(a) (1) Notwithstanding any remedy available under § 3–507 of this subtitle[,]: 14
(I) if an employer fails to pay an employee in accordance with § 15
3–502 or § 3–505 of this subtitle, after 2 weeks have elapsed from the date on which the 16
employer is required to have paid the wages, the employee may bring an action against the 17
employer to recover the unpaid wages; OR 18
(II) THE ATTORNEY GENERAL MAY BRING AN ACTION ON 19
BEHALF OF EMPLOYEES TO RECOVER UNPAID WA GES IF, AFTER 2 WEEKS HAVE 20
ELAPSED FROM THE DAT E ON WHICH AN EMPLOYER IS REQUIRED TO HAVE PAID THE 21
WAGES: 22
1. THE EMPLOYER FAILS T O PAY 10 OR MORE 23
EMPLOYEES IN ACCORDA NCE WITH § 3–502 OR § 3–505 OF THIS SUBTITLE; OR 24
2. IN ACCORDANCE WITH § 3–502 OR § 3–505 OF THIS 25
SUBTITLE, THE TOTAL AMOUNT OF UNPAID WAGES FOR ALL AFFECTED EMPLOYEES 26
IS $25,000 OR GREATER . 27
(2) BEFORE BRINGING AN AC TION UNDER PARAGRAPH (1)(II) OF THIS 28
SUBSECTION, THE ATTORNEY GENERAL MAY CONDUCT A N INVESTIGATION IN 29
ACCORDANCE WITH § 6–1006 OF THE STATE GOVERNMENT ARTICLE. 30
SENATE BILL 938 9
(b) If, in an action under subsection (a) of this section, a court finds that an 1
employer withheld the wage of an employee in violation of this subtitle and not as a result 2
of a bona fide dispute, the court may award the employee an amount not exceeding 3 times 3
the wage, and reasonable counsel fees and other costs. 4
(c) (1) (I) In this subsection[, “construction services” has the meaning 5
stated in § 3–901 of this title] THE FOLLOWING WORDS HAVE THE MEANINGS 6
INDICATED. 7
(II) “CONSTRUCTION SERVICES ” INCLUDES THE FOLLOWING 8
SERVICES PROVIDED IN CONNECTION WITH REAL PROPERTY: 9
1. BUILDING; 10
2. RECONSTRUCTING ; 11
3. IMPROVING; 12
4. ENLARGING; 13
5. PAINTING; 14
6. ALTERING; 15
7. MAINTAINING; AND 16
8. REPAIRING. 17
(III) “GENERAL CONTRACTOR ” HAS THE MEANING STAT ED IN § 18
3–901 OF THIS TITLE. 19
(2) In an action brought under subsection (a) of this section, a general 20
contractor on a project for construction services is jointly and severally liable for a violation 21
of this subtitle that is committed by a subcontractor, regardless of whether the 22
subcontractor is in a direct contractual relationship with the general contractor. 23
(3) A subcontractor shall indemnify a general contractor for any wages, 24
damages, interest, penalties, or attorney’s fees owed as a result of the subcontractor’s 25
violation unless: 26
(i) indemnification is provided for in a contract between the general 27
contractor and the subcontractor; or 28
10 SENATE BILL 938
(ii) a violation of the subtitle arose due to a lack of prompt payment 1
in accordance with the terms of the contract between the general contractor and the 2
subcontractor. 3
3–901. 4
(a) In this subtitle the following words have the meanings indicated. 5
[(b) “Construction services” includes the following services provided in connection 6
with real property: 7
(1) building; 8
(2) reconstructing; 9
(3) improving; 10
(4) enlarging; 11
(5) painting; 12
(6) altering; 13
(7) maintaining; and 14
(8) repairing.] 15
(B) (1) “ECONOMIC DAMAGES ” MEANS A FINANCIAL LO SS INCURRED BY 16
AN EMPLO YEE AS A RESULT OF B EING MISCLASSIFIED B Y AN EMPLOYER IN 17
VIOLATION OF THIS SU BTITLE. 18
(2) “ECONOMIC DAMAGES ” INCLUDES: 19
(I) UNPAID WAGES ; 20
(II) LOST BENEFITS; AND 21
(III) REIMBURSEMENT FOR EX PENSES THAT, BY AGREEMENT OR 22
PRACTICE, THE EMPLOYER PAID TO WORKERS CLAS SIFIED AS EMPLOYEES . 23
(C) “EMPLOYEE” MEANS AN INDIVIDUAL WHO: 24
(1) PERFORMS WORK FOR RE MUNERATION PAID BY A PERSON; AND 25
SENATE BILL 938 11
(2) IS ENTITLED TO ALL T HE RIGHTS AND PROTEC TIONS AFFORDED 1
TO EMPLOYEES UNDER F EDERAL AND STATE LAW, INCLUDING WAGE AND HOUR 2
LAWS, ANTIDISCRIMINATION L AWS, AND, AS APPLICABLE , WORKERS’ 3
COMPENSATION AND UNE MPLOYMENT INSURANCE BENEFITS. 4
[(c)] (D) “Employer” means any person, OR A SUCCESSOR OF TH E PERSON, 5
that employs an [individual] EMPLOYEE in the State. 6
[(d) “Exempt person” means an individual who: 7
(1) performs services in a personal capacity and employs no individuals 8
other than: 9
(i) a spouse of the exempt person; 10
(ii) children of the exempt person; or 11
(iii) parents of the exempt person; 12
(2) performs services free from direction and control over the means and 13
manner of providing the services, subject only to the right of the person or entity for whom 14
services are provided to specify the desired result; 15
(3) furnishes the tools and equipment necessary to provide the service; 16
(4) operates a business that is considered inseparable from the individual 17
for purposes of taxes, profits, and liabilities: 18
(i) in which the individual: 19
1. owns all of the assets and profits of the business; and 20
2. has sole, unlimited, personal liability for all of the debts 21
and liabilities of the business, unless the business is organized as a single–owned corporate 22
entity, to which sole, unlimited personal liability does not apply; and 23
(ii) for which: 24
1. the individual does not pay taxes for the business 25
separately but reports business income and losses on the individual’s personal tax return; 26
and 27
2. if the business is organized as a corporate entity and the 28
individual otherwise qualifies as an exempt person under this subsection, the individual 29
files a separate federal informational tax return for the entity as required by law; 30
12 SENATE BILL 938
(5) exercises complete control over the management and operations of the 1
business; and 2
(6) exercises the right and opportunity on a continuing basis to perform the 3
services of the business for multiple entities at the individual’s sole choice and discretion.] 4
(E) “GENERAL CONTRACTOR ” MEANS A PERSON THAT ENTERS INTO AN 5
AGREEMENT WITH AN OW NER TO OVERSEE AND C OORDINATE THE ENTIRE SCOPE OF 6
A PROJECT, INCLUDING ENSURING T HAT THE WORK MEETS T HE TERMS OF THE 7
AGREEMENT . 8
(F) “HIGHER–TIERED CONTRACTOR ” MEANS A PERSON THAT ENTERS INTO 9
AN AGREEMENT WITH A GENERAL CONTRACTOR T O PERFORM SERVICES O N A 10
PROJECT AND WHO SUB CONTRACTS ANY PORTIO N OF THE WORK TO ANO THER 11
PERSON. 12
[(e)] (G) “Knowingly” means having actual knowledge[,] OF OR deliberate 13
[ignorance, or reckless] disregard for the [truth] REQUIREMENTS OF THIS SUBTITLE. 14
[(f) “Landscaping services” includes the following services: 15
(1) garden maintenance and planting; 16
(2) lawn care including fertilizing, mowing, mulching, seeding, and 17
spraying; 18
(3) seeding and mowing of highway strips; 19
(4) sod laying; 20
(5) turf installation, except artificial; 21
(6) ornamental bush planting, pruning, bracing, spraying, and removal; 22
and 23
(7) ornamental tree planting, pruning, bracing, spraying, and removal. 24
(g) (1) “Place of business” means the office or headquarters of the employer. 25
(2) “Place of business” does not include a work site at which the employer 26
has been contracted to perform services.] 27
(h) “Public body” means: 28
(1) the State; 29
SENATE BILL 938 13
(2) a unit of State government or an instrumentality of the State; or 1
(3) any political subdivision, agency, person, or entity that is a party to a 2
contract for which 50% or more of the money used is State money. 3
(I) “SUBCONTRACTOR ” MEANS A PERSON THAT ENTERS INTO AN 4
AGREEMENT WITH A GEN ERAL CONTRACTOR OR H IGHER–TIERED CONTRACTOR TO 5
PERFORM A SPECIFIC P ORTION OF WOR K OR SERVICES AS PAR T OF A LARGER 6
PROJECT OR CONTRACT . 7
(J) “SUCCESSOR” MEANS AN EMPLOYER THAT : 8
(1) ACQUIRES, THROUGH ANY FORM OF TRANSACTION , THE BUSINESS 9
OPERATIONS, ASSETS, WORKFORCE , OR OTHER SIGNIFICANT ELEMENTS OF 10
ANOTHER EMPLOYER ; AND 11
(2) CONTINUES TO OPERATE THE BUSINESS IN ESSE NTIALLY THE 12
SAME MANNER AS THE P REVIOUS EMPLOYER . 13
(K) (1) “WORKER” MEANS AN INDIVIDUAL PERFORMING SERVICES FOR 14
REMUNERATION . 15
(2) “WORKER” INCLUDES EMPLOYEES A ND INDIVIDUALS CLASS IFIED 16
OR ALLEGED TO BE IND EPENDENT CONTRACTORS , REGARDLESS OF THE LE GAL 17
RELATIONSHIP BETWEEN THE PARTIES. 18
3–902. 19
This subtitle applies [only] to [the following industries] ALL: 20
(1) [construction services] INDUSTRIES AND SECTO RS WITHIN THE 21
STATE; and 22
(2) [landscaping services] EMPLOYERS , GENERAL CONTRACTORS , 23
HIGHER–TIERED CONTRACTORS , SUBCONTRACTORS , AND OTHER PERSONS 24
ENGAGING WORKERS IN THE STATE. 25
3–903. 26
(A) (1) FOR PURPOSES OF THIS SUBTITLE, A GENERAL CONTRACTOR 27
SHALL BE CONSIDERED TO BE AN EMPLOYER OF A WORKER WHO A HIGHE R–TIERED 28
CONTRACTOR OR SUBCON TRACTOR HAS FAILED T O PROPERLY CLASSIFY AS AN 29
EMPLOYEE ON A PROJEC T OVER WHICH THE GEN ERAL CONTRACTOR HAS 30 14 SENATE BILL 938
RESPONSIBILITY FOR O VERSIGHT AND COORDIN ATION, INCLUDING ENSURING T HAT 1
THE WORK MEETS THE T ERMS OF THE AGREEMEN T. 2
(2) PARAGRAPH (1) OF THIS SUBSECTION M AY NOT BE CONSTRUED 3
TO AFFECT THE EMPLOY ER STATUS OF THE HIG HER–TIERED CONTRACTOR OR 4
SUBCONTRACTOR WITH R ESPECT TO THE MISCLA SSIFIED EMPLOYEE . 5
(B) (1) FOR PURPOSES OF THIS SUBTITLE, A HIGHER –TIERED 6
CONTRACTOR SHALL BE CONSIDERED AN EMPLOYE R OF A WORKER WHO A 7
SUBCONTRACTOR OF THE HIGHER–TIERED CONTRACTOR HA S FAILED TO PROPERLY 8
CLASSIFY AS AN EMPLO YEE. 9
(2) PARAGRAPH (1) OF THIS SUBSECTION M AY NOT BE CONSTRUED 10
TO AFFECT THE EMPLOY ER STATUS OF THE SUB CONTRACTOR WITH RESP ECT TO 11
THE MISCLASSIFIED EM PLOYEE. 12
3–904. 13
(a) An employer may not fail to properly classify an individual who performs work 14
for remuneration paid by the employer. 15
(b) An employer has failed to properly classify an individual when an 16
employer–employee relationship exists as determined under subsection (c) of this section 17
but the employer has not classified the individual as an employee. 18
[(c) (1) Except as provided in § 3–903.1 of this subtitle, for purposes of 19
enforcement of this subtitle only, work performed by an individual for remuneration paid 20
by an employer shall be presumed to create an employer–employee relationship, unless: 21
(i) the individual is an exempt person; or 22
(ii) an employer demonstrates that: 23
1. the individual who performs the work is free from control 24
and direction over its performance both in fact and under the contract; 25
2. the individual customarily is engaged in an independent 26
business or occupation of the same nature as that involved in the work; and 27
3. the work is: 28
A. outside of the usual course of business of the person for 29
whom the work is performed; or 30
B. performed outside of any place of business of the person 31
for whom the work is performed. 32 SENATE BILL 938 15
(2) Work is outside of the usual course of business of the person for whom 1
it is performed under paragraph (1) of this subsection if: 2
(i) the individual performs the work off the employer’s premises; 3
(ii) the individual performs work that is not integrated into the 4
employer’s operation; or 5
(iii) the work performed is unrelated to the employer’s business. 6
(3) By contract, an employer may engage another business entity, which 7
may have its own employees, to do the same type of work in which the employer engages, 8
at the same location where th e employer is working, without establishing an 9
employer–employee relationship between the two contracting entities.] 10
(C) (1) AN EMPLOYER–EMPLOYEE RELATIONSHI P IS PRESUMED TO EXI ST 11
WHEN WORK IS PERFORM ED BY A WORKER FOR R EMUNERATION PAID BY A PERSON, 12
UNLESS THE PERSON PROV IDING THE REMUNERATI ON DEMONSTRATES THAT : 13
(I) THE WORKER IS FREE F ROM CONTROL AND DIRE CTION 14
OVER THE PERFORMANCE OF SERVICES, SUBJECT ONLY TO THE RIGHT OF THE 15
PERSON FOR WHICH SER VICES ARE PROVIDED T O SPECIFY THE DESIRE D RESULT, 16
BOTH IN FACT AND UNDER THE CONTRACT ; 17
(II) THE WORKER CUSTOMARI LY IS ENGAGED IN AN 18
INDEPENDENTLY ESTABL ISHED TRADE, OCCUPATION , PROFESSION, OR BUSINESS 19
THAT IS OF THE SAME NATURE AS THAT INVOL VED IN THE WORK BEIN G PERFORMED 20
BY THE WORKER FOR TH E PERSON; AND 21
(III) THE WORK IS: 22
1. OUTSIDE THE USUAL CO URSE OF BUSINESS OF THE 23
PERSON FOR WHICH THE WORK IS PERFORMED ; OR 24
2. PERFORMED OUTSIDE AN Y PLACE OF BUSINESS OF 25
THE PERSON FOR WHICH THE WORK IS PERFORME D. 26
(2) WORK IS OUTSIDE THE U SUAL COURSE OF BUSINESS OF THE 27
PERSON FOR WHICH IT IS PERFORMED UNDER P ARAGRAPH (1)(III)1 OF THIS 28
SUBSECTION IF: 29
(I) THE INDIVIDUAL PERFO RMS THE WORK OFF THE 30
EMPLOYER’S PREMISES; 31 16 SENATE BILL 938
(II) THE INDIVIDUAL PERFO RMS WORK THAT IS NOT 1
INTEGRATED INTO THE EMPLOYER’S OPERATION; OR 2
(III) THE WORK PERFORMED I S UNRELATED TO THE 3
EMPLOYER’S BUSINESS. 4
(3) AN EMPLOYER MAY ENGAG E BY CONTRACT ANOTHE R BUSINESS 5
ENTITY, WHICH MAY HAVE ITS O WN EMPLOYEES , TO DO THE SAME TYPE OF WORK IN 6
WHICH THE EMPLOYER E NGAGES AT THE SAME L OCATION WHERE THE EMPLO YER 7
IS WORKING WITHOUT E STABLISHING AN EMPLO YER–EMPLOYEE RELATIONSHI P 8
BETWEEN THE TWO CONT RACTING ENTITIES . 9
(d) The Commissioner shall adopt regulations to explain further and provide 10
specific examples of the application of subsection (c) of this section. 11
3–905. 12
(A) THIS SUBTITLE MAY NOT BE WAIVED OR SET ASI DE BY PRIVATE 13
AGREEMENT . 14
(B) AN AGREEMENT MADE BET WEEN AN EMPLOYER AND EMPLOYEE IN 15
WHICH THE EMPLOYEE A GREES TO BE CLASSIFI ED AS AN INDEPENDENT 16
CONTRACTOR IS NOT A DEFENSE TO A CITATION OR IN A CIV IL ACTION BROUGHT 17
UNDER THIS SUBTITLE . 18
3–906. 19
(A) THE COMMISSIONER , ON THE COMMISSIONER ’S OWN INITIATIVE OR ON 20
RECEIPT OF A COMPLAI NT, SHALL INVESTIGATE TO DETERMINE COMPLIANCE WITH 21
THIS SUBTITLE. 22
(B) (1) IN CONDUCTING AN INVESTIGATION UNDER THIS SECTION, THE 23
COMMISSIONER MAY : 24
(I) ENTER AND INSPECT A PERSON’S PLACE OF BUSINESS OR 25
PLACE OF WORK TO : 26
1. OBSERVE WORK BEING P ERFORMED ; AND 27
2. EXAMINE AND COPY : 28
A. RECORDS THAT THE PER SON IS REQUIRED TO K EEP IN 29
ACCORDANCE WITH THIS TITLE; 30 SENATE BILL 938 17
B. BOOKS, REGISTERS, PAYROLL RECORDS , RECORDS OF 1
WAGE WITHHOLDINGS , RECORDS OF WORK ACTI VITY AND HOURS OF WO RK, AND 2
RECORDS OR INDICIA O F THE EMPLOYMENT STA TUS OF WORKERS PERFO RMING 3
WORK FOR THE PERSON ; AND 4
C. ANY OTHE R RECORDS RELATING T O COMPLIANCE 5
WITH THIS SUBTITLE O R REGULATIONS ADOPTE D UNDER THIS SUBTITL E; 6
(II) REQUIRE A PERSON TO PRODUCE WITHIN 15 CALENDAR 7
DAYS A TRUE AND CORR ECT COPY OF AN ITEM DESCRIBED UNDER ITEM (I)2 OF THIS 8
PARAGRAPH ; 9
(III) DETERMINE THE IDENTITY AND ACT IVITIES OF A WORKER 10
RECEIVING REMUNERATI ON FROM THE PERSON ; OR 11
(IV) CONDUCT CONFIDENTIAL INTERVIEWS AND OBTAI N ORAL 12
OR WRITTEN STATEMENT S FROM A WORKER RELA TING TO INFORMATION 13
CONCERNING THE REMUN ERATION OF WORKERS A ND THE NATURE A ND EXTENT OF 14
THE SERVICES PERFORM ED. 15
(2) THE COMMISSIONER MAY COND UCT THE ACTIVITIES D ESCRIBED 16
IN PARAGRAPH (1) OF THIS SUBSECTION A T: 17
(I) A LOCATION WHERE WOR KERS ARE ENGAGED TO PERFORM 18
WORK FOR THE PERSON ; AND 19
(II) ANY OTHER LOCATION W HERE THE ITEMS DESCRIBED IN 20
PARAGRAPH (1)(I) OF THIS SUBSECTION A RE MAINTAINED BY THE PERSON OR AN 21
AGENT OF THE PERSON . 22
3–907. 23
(A) SUBJECT TO SUBSECTION (C) OF THIS SECTION, IF THE COMMISSIONER 24
IS DENIED ACCESS TO A PLACE OF BUSINESS OR PLACE OF WORK AFT ER MAKING A 25
PROPER REQUEST TO TH E OWNER, LESSEE, EMPLOYER, OR OTHER PERSON IN 26
CHARGE OF ACCESS TO THE PLACE OF BUSINES S OR PLACE OF WORK , THE 27
COMMISSIONER MAY APPL Y TO THE DISTRICT COURT FOR AN ADMINIST RATIVE 28
SEARCH WARRANT UNDER THIS SECTION. 29
(B) EACH APPLICA TION UNDER THIS SECT ION SHALL: 30
18 SENATE BILL 938
(1) STATE THE NATURE , PURPOSE, AND SCOPE OF THE INS PECTION; 1
AND 2
(2) SHOW THAT: 3
(I) THE APPLICANT IS AUT HORIZED BY LAW TO IN SPECT THE 4
PLACE OF BUSINESS OR PLACE OF WORK TO WHI CH ACCESS WAS DENIED ; 5
(II) THE APPLIC ANT REQUESTED ACCESS AT A REASONABLE 6
TIME AND THE ACCESS WAS DENIED; AND 7
(III) THE INSPECTION IS FO R A PURPOSE RELATED TO THIS 8
SUBTITLE. 9
(C) THE COMMISSIONER MAY NOT SUBMIT AN APPLICATIO N UNDER 10
SUBSECTION (A) OF THIS SECTION UNLE SS THE SUBMISSION IS APPROVED BY THE 11
ATTORNEY GENERAL. 12
(D) ON A SHOWING OF PROBA BLE CAUSE, THE DISTRICT COURT SHALL 13
ISSUE THE ADMINISTRA TIVE SEARCH WARRANT AUTHORIZING THE COMMISSIONER 14
OR AUTHORIZED REPRES ENTATIVE TO ENTER AN D INSPECT THE PLACE OF 15
BUSINESS OR PLACE OF WORK, EXAMINE AND COPY REC ORDS, AND TAKE OTHER 16
NECESSARY ACTIONS TO ENFORCE COMPLIANCE W ITH THIS SUBTITLE. 17
3–908. 18
(A) IN ENFORCING THIS SUB TITLE, THE COMMISSIONER MAY : 19
(1) ADMINISTER OATHS AND QUESTION WITNESSES O N RECORD AND 20
UNDER OATH ; AND 21
(2) ISSUE A SUBPOENA FOR : 22
(I) THE PRODUCTION OF A PERSON’S BOOKS, DOCUMENTS , 23
PAPERS, AND RECORDS ; AND 24
(II) THE ATTENDANCE OF A WITNESS TO TESTIFY . 25
(B) SUBJECT TO SUBSECTION (C) OF THIS SECTION, IF A PERSON FAILS TO 26
COMPLY WITH A SUBPOE NA ISSUED UNDER SUBS ECTION (A)(2) OF THIS SECTION OR 27
FAILS TO TESTIFY ON A MATTER ON WHICH TH E PERSON MAY LAWFULL Y BE 28
INTERROGATED , ON A COMPLAINT FILED BY THE COMMISSIONER , THE CIRCUIT 29
COURT FOR THE COUNTY IN WHICH THE PERSON RESIDES OR IS PRESEN T MAY PASS 30 SENATE BILL 938 19
AN ORDER DIRECTING C OMPLIANCE WITH THE S UBPOENA OR COMPELLIN G 1
TESTIMONY. 2
(C) THE COMMISSIONER MAY NOT FILE A COMPLAINT TO ENFORCE A 3
SUBPOENA UNLESS THE FILING IS APPROVED B Y THE ATTORNEY GENERAL. 4
(D) (1) A PERSON MAY NOT BE EX CUSED, ON THE GROUNDS THAT THE 5
TESTIMONY OR EVIDENCE MAY INCRIMI NATE THE PERSON OR S UBJECT THE PERSON 6
TO A PENALTY OR FORF EITURE, FROM: 7
(I) ATTENDING AND TESTIF YING AS REQUIRED UND ER THIS 8
SECTION; OR 9
(II) PRODUCING ANY DOCUME NT OR RECORD BEFORE THE 10
COMMISSIONER OR IN A PROCEEDING INITIATED BY THE COMMISSIONER . 11
(2) EXCEPT IN CASES OF PE RJURY OR CONTEMPT DU RING 12
TESTIMONY, TESTIMONY AND EVIDEN CE GIVEN IN ACCORDAN CE WITH THIS SECTION 13
MAY NOT BE USED TO C RIMINALLY PROSECUTE AN INDIVIDUAL FOR TH E SPECIFIC 14
SUBJECT THE INDIVIDU AL WAS COMPELLED TO TESTIFY OR PRODUCE E VIDENCE 15
ABOUT. 16
3–909. 17
(A) EXCEPT AS PROVIDED IN SUBSECTION (B) OF THIS SECTION , AN 18
EMPLOYER THAT FAILS TO PROPERLY CLASSIFY AN EMPLOYEE SHALL BE SUBJECT 19
TO A CIVIL PENALTY O F NOT LESS THAN $5,000 AND NOT MORE THAN $10,000 FOR 20
EACH EMPLOYEE NOT PROPERL Y CLASSIFIED. 21
(B) AN EMPLOYER THAT KNOW INGLY FAILS TO PROPE RLY CLASSIFY AN 22
EMPLOYEE SHALL BE SU BJECT TO A CIVIL PEN ALTY OF NOT LESS THA N $10,000 AND 23
NOT MORE THAN $25,000 FOR EACH EMPLOYEE NO T PROPERLY CLASSIFIE D. 24
(C) A PERSON HAS V IOLATED THIS SUBTITL E AND IS SUBJECT TO A CIVIL 25
PENALTY OF $5,000 PER OCCURRENCE IF TH E PERSON: 26
(1) HINDERS OR DELAYS TH E COMMISSIONER ’S INVESTIGATION 27
UNDER THIS SUBTITLE ; 28
(2) REFUSES TO ADMIT , AT REASONABLE TIMES , THE COMMISSIONER 29
TO A PLACE OF BUSI NESS OR WORK ; 30
20 SENATE BILL 938
(3) FAILS TO GIVE INFORM ATION LAWFULLY REQUI RED FOR THE 1
PROPER ENFORCEMENT O F THIS SUBTITLE, ON DEMAND OF THE COMMISSIONER ; 2
(4) FAILS OR REFUSES TO MAKE RECORDS RELATIN G TO WORKERS 3
ACCESSIBLE TO THE COMMISSIONER ; OR 4
(5) FALSIFIES RECORDS RELATING TO WO RKERS. 5
(D) THE COMMISSIONER SHALL DE TERMINE THE AMOUNT O F A PENALTY 6
FOR MISCLASSIFICATIO N OF EMPLOYEES BASED ON: 7
(1) THE NUMBER OF MISCLA SSIFIED EMPLOYEES ; 8
(2) THE DURATION OF THE MISCLASSIFICATION ; 9
(3) THE SEVERITY OF THE VIOLATION; 10
(4) THE IMPACT ON THE AF FECTED EMPLOYEES , INCLUDING UNPAID 11
WAGES, BENEFITS, AND TAXES; AND 12
(5) WHETHER THE EMPLOYER HAS PREVIOUSLY VIOLA TED THIS 13
SUBTITLE. 14
(E) IN ADDITION TO THE PE NALTIES PROVIDED IN SUBSECTIONS (A) 15
THROUGH (C) OF THIS SECTION, AN EMPLOYER MAY BE O RDERED BY THE 16
COMMISSIONER TO : 17
(1) PAY RESTITUTION FOR ECONOMIC DAMAGES SUF FERED BY AN 18
EMPLOYEE AS A RESULT OF THE EMPLOYER ’S FAILURE TO PROPERL Y CLASSIFY THE 19
EMPLOYEE; AND 20
(2) COME INTO COMPLIANCE WITH THIS SUBTITLE . 21
(F) IN ADDITION TO ANY OT HER RESTITUTION OR B ENEFIT TO WHICH AN 22
EMPLOYEE MAY BE ENTI TLED UNDER THIS SUBT ITLE, ONE–THIRD OF THE AMOUNT 23
OF A CIVIL PENALTY I MPOSED UNDER THIS SE CTION FOR A KNOWING VIOLATION 24
SHALL BE PAYABLE DIR ECTLY TO THE AFFECTE D EMPLOYEE. 25
3–910. 26
(A) IF, AFTER AN INVESTIGATI ON, THE COMMISSIONER DETERMIN ES THAT 27
A PERSON HAS VIOLATE D OR FAILED TO COMPL Y WITH THE REQUIREME NTS OF THIS 28
SUBTITLE, THE COMMISSIONER SHALL IS SUE A CITATION WITH REASONABLE 29
PROMPTNESS . 30 SENATE BILL 938 21
(B) EACH CITATION ISSUED UNDER SUBSECTION (A) OF THIS SECTION 1
SHALL: 2
(1) BE IN WRITING; 3
(2) IDENTIFY EACH PERSON ALLEGED TO HAVE VIOL ATED THIS 4
SUBTITLE AS A RESPON DENT TO THE CITATION ; 5
(3) DESCRIBE, WITH PARTICULARITY , THE NATURE OF THE AL LEGED 6
VIOLATION; 7
(4) REFERENCE THE PROVISION OF THIS SU BTITLE OR REGULATION 8
ADOPTED UNDER THIS S UBTITLE THAT THE PER SON IS ALLEGED TO HA VE 9
VIOLATED; 10
(5) STATE THE CIVIL PENA LTY, IF ANY, THE COMMISSIONER 11
PROPOSES TO ASSESS U NDER THIS SUBTITLE ; 12
(6) STATE THE AMOUNT OF RESTITUTION, IF ANY, ORDERED BY THE 13
COMMISSIONER TO BE PA ID TO AN EMPLOYEE UN DER § 3–909(E) OF THIS SUBTITLE; 14
(7) STATE ALL ACTIONS NE CESSARY TO COME INTO COMPLIANCE 15
WITH THIS SUBTITLE A ND SET A REASONABLE PERIOD FOR THE RESPO NDENT TO 16
TAKE CORRECTIVE ACTI ON; 17
(8) NOTIFY THE RESPONDENT THAT, WITHIN 30 DAYS AFTER RECEIPT 18
OF THE CITATION , THE RESPONDENT MAY R EQUEST AN ADMINISTRA TIVE HEARING 19
ON THE CITATION AND PENALTY AND THAT THE HEARING WILL BE COND UCTED IN 20
ACCORDANCE WITH TITLE 10, SUBTITLE 2 OF THE STATE GOVERNMENT ARTICLE; 21
AND 22
(9) NOTIFY THE RESPONDEN T THAT IF A HEARING IS NOT REQUESTED 23
WITHIN 30 DAYS OF MAILING THE CITATION, THE CITATION BECOMES A FINAL 24
ORDER OF THE COMMISSIONER . 25
(C) THE COMMISSIONER SHALL SE ND A CITATION ISSUED UNDER 26
SUBSECTION (A) OF THIS SECTION BY CERTIFIED AND FIRST–CLASS MAIL. 27
3–911. 28
(A) WITHIN 30 DAYS AFTER THE COMMISSIONER MAILS A CITATION ISSUED 29
UNDER § 3–910(A) OF THIS SUBTITLE , THE RESPONDENT MAY S UBMIT A WRITTEN 30 22 SENATE BILL 938
REQUEST FOR A HEARIN G ON THE CITATION AN D PROPOSED PENALTY A ND 1
RESTITUTION, IF ANY. 2
(B) THE CITATION AND PROP OSED PENALTY AND RES TITUTION WILL BE 3
CONVERTED TO A FINAL ORDER OF THE COMMISSIONER IF AN AD MINISTRATIVE 4
HEARING IS NOT REQUE STED BY THE RESPONDE NT WITHIN 30 DAYS AFTER THE 5
RECEIPT OF THE CITAT ION. 6
(C) IF THE RESPONDENT REQUESTS A HEARING, THE COMMISSIONER 7
SHALL DELEGATE TO TH E OFFICE OF ADMINISTRATIVE HEARINGS THE AUTHORIT Y 8
TO HOLD A HEARING IN ACCORDANCE WITH TITLE 10, SUBTITLE 2 OF THE STATE 9
GOVERNMENT ARTICLE. 10
(D) AN ADMINISTRATIVE LAW JUDGE SHALL ISSUE F INDINGS OF FACT , 11
CONCLUSIONS OF LAW , AND A FINAL ORDER AF FIRMING, MODIFYING, OR VACATING 12
ALL OR PART OF THE C ITATION AND ANY PROP OSED PENALTY OR REST ITUTION. 13
(E) THE COMMISSIONER HAS THE BURDEN OF PROOF , BY A 14
PREPONDERANCE OF THE EVIDENCE, TO SHOW THAT : 15
(1) THE RESPONDENT HAS V IOLATED THIS SUBTITL E; AND 16
(2) ANY PROPOSED PENALTY , RESTITUTION, AND ORDER FOR 17
COMPLIANCE IS APPROP RIATE. 18
(F) WITHIN 30 DAYS AFTER THE ISSUA NCE OF A FINAL ORDER UNDER 19
SUBSECTION (D) OF THIS SECTION , A RESPONDENT FOUND I N VIOLATION OF THIS 20
SUBTITLE SHALL : 21
(1) PAY ANY ASSESSED PEN ALTIES TO THE COMMISSIONER ; 22
(2) PAY ANY ORDERED REST ITUTION TO OR ON BEH ALF OF AN 23
EMPLOYEE WHOM THE RE SPONDENT FAILED TO P ROPERLY CLASSIFY ; AND 24
(3) TAKE ALL OTHER ACTIO NS SPECIFIED AS NECE SSARY TO COME 25
INTO COMPLIANCE WITH THIS SUBTITLE. 26
(G) (1) A PARTY AGGRIEVED BY A FINAL ORDER OF THE COMMISSIONER 27
UNDER SUBSECTION (I) OF THIS SECTION MAY SEEK JUDICIAL REVIEW AND APPEAL 28
UNDER §§ 10–222 AND 10–223 OF THE STATE GOVERNMENT ARTICLE. 29
SENATE BILL 938 23
(2) (I) SUBJECT TO SUBPARAGRA PH (II) OF THIS PARAGRAPH , A 1
FINAL ORDER OF THE COMMISSIONER IS STAYE D UNTIL THE TIME FOR SEEKING 2
JUDICIAL REVIEW EXPI RES. 3
(II) IF A TIMELY APPEAL IS FILED, THE ORDER IS STAYED UNTIL 4
FINAL DISPOSITION BY THE COURT. 5
(3) THE COMMISSIONER MAY SEEK JUDICIAL ENFORCEMENT OF A 6
FINAL ORDER. 7
(H) A FINAL ORDER OF THE COMMISSIONER SHALL RE MAIN IN EFFECT 8
AGAINST A SUCCESSOR OF THE PERSON AGAINS T WHICH THE FINAL OR DER WAS 9
ISSUED. 10
(I) A PREVIOUS FINAL ORDER FINDING A VIOLATION OF THIS SUBTITLE BY 11
AN EMPLOYER SHALL ES TABLISH THAT THE EMP LOYER’S OR SUCCESSOR ’S 12
SUBSEQUENT VIOLATION S WERE COMMITTED KNO WINGLY. 13
(J) THE REMEDIES INCLUDED IN A FINAL ORDER OF A COURT OR AN 14
ADMINISTRATIVE UNIT REGARDING THE FAILURE OF AN EM PLOYER TO PROPERLY 15
CLASSIFY AN INDIVIDU AL AS AN EMPLOYEE IS IN ADDITION TO ANY O THER REMEDY 16
AVAILABLE TO THE EMP LOYEE FOR A VIOLATIO N OF ANOTHER STATE LAW, 17
INCLUDING THE MARYLAND WAGE AND HOUR LAW, TITLE 17, SUBTITLE 2 OF THE 18
STATE FINANCE AND PROCUREMENT ARTICLE, OR TITLE 18 OF THE STATE 19
FINANCE AND PROCUREMENT ARTICLE, THAT RESULTED FROM T HE 20
MISCLASSIFICATION . 21
3–912. 22
(a) As authorized by State and federal law, units within the Maryland 23
Department of Labor and the Department of Budget and Management, the Secretary of 24
State, the Comptroller, the Maryland Insurance Administration, THE OFFICE OF THE 25
ATTORNEY GENERAL, and [other State agencies] THE STATE DEPARTMENT OF 26
ASSESSMENTS AND TAXATION shall cooperate and share information concerning any 27
suspected failure to properly classify [an individual] A WORKER as an employee. 28
(b) [On a showing by clear and convincing evidence that a violation of § 3–904 of 29
this subtitle has occurred and as authorized by federal and State law, the] THE 30
Commissioner shall refer [any complaint that alleges] a SUSPECTED violation of § 13–1007 31
or § 13–1024 of the Tax – General Article to the: 32
(1) Comptroller; 33
(2) State’s Attorney with jurisdiction over the alleged violation; 34 24 SENATE BILL 938
(3) U.S. Department of Justice; 1
(4) U.S. Department of Labor; and 2
(5) U.S. Department of the Treasury. 3
(C) (1) EACH YEAR, THE COMMISSIONER SHALL DI SSEMINATE ALL FINAL 4
ORDERS ISSUED UNDER THIS SUBTITLE TO EAC H AGENCY LISTED IN SUBSECTION (A) 5
OF THIS SECTION. 6
(2) AN AGENCY LISTED UNDE R SUBSECTION (A) OF THIS SECTION 7
MAY NOT ISSUE OR REN EW A LICENSE TO A RE SPONDENT IN VIOLATIO N OF THIS 8
SUBTITLE UNTIL THE R ESPONDENT COMES INTO COMPLIANCE WITH THE FINAL 9
ORDER. 10
(3) THE COMMISSIONER SHALL ADOPT PRO CEDURES FOR ADVISING 11
THE AGENCIES LISTED UNDER SUBSECTION (A) OF THIS SECTION OF W HEN A 12
RESPONDENT COMES INT O COMPLIANCE WITH A FINAL ORDER ISSUED U NDER THIS 13
SUBTITLE. 14
3–913. 15
(a) (1) Except as provided in paragraph (2) of this subsection, an [individual] 16
EMPLOYEE who has not been properly classified as an employee may bring a civil action 17
[for economic damages] against the employer for any violation of this subtitle. 18
(2) EXCEPT AS PROVIDED IN PARAGRAPH (3) OF THIS SUBSECTION , IF 19
AN EMPLOYER FAILS TO PR OPERLY CLASSIFY 10 OR MORE EMPLOYEES RE SULTING 20
IN ECONOMIC DAMAGES TOTALING $25,000 OR MORE, THE ATTORNEY GENERAL 21
MAY BRING AN ACTION AGAINST THE EMPLOYER ON BEHALF OF THE EMP LOYEES 22
ALLEGED TO HAVE BEEN IMPROPERLY CLASSIFIE D FOR A VIOL ATION OF THIS 23
SUBTITLE. 24
(3) An [individual] EMPLOYEE OR THE ATTORNEY GENERAL may not 25
bring a civil action [under this section if] ON THE SAME FACTS AN D ISSUES ADDRESSED 26
BY a final order of [an administrative unit or of a court has been issued under § 3–906 of] 27
THE COMMISSIONER ISSUED I N ACCORDANCE WITH this subtitle. 28
(4) (I) ON THE FILING OF AN A CTION BY AN EMPLOYEE OR THE 29
ATTORNEY GENERAL UNDER PARAGRA PH (1) OR (2) OF THIS SUBSECTION I N A 30
COURT OF COMPETENT J URISDICTION CONCERNI NG A MATTER UNDER 31
INVESTIGATION OR SUBJECT TO ADMINISTRATIVE PR OCEEDINGS BY THE 32
COMMISSIONER , THE COMMISSIONER SHALL : 33 SENATE BILL 938 25
1. STAY THE INVESTIGATI ON OR ADMINISTRATIVE 1
PROCEEDING UNTIL THE COURT ACTION IS RESO LVED; AND 2
2. NOTIFY THE PARTIES O F THE RESOLUTION . 3
(II) ON RESOLUTION OF THE CO URT ACTION , THE 4
COMMISSIONER MAY RESU ME THE INVESTIGATION OR ADMINISTRATIVE 5
PROCEEDINGS IF NECES SARY AND APPROPRIATE , TAKING INTO CONSIDER ATION 6
THE FINDINGS AND OUT COMES OF THE COURT A CTION. 7
(b) An action filed under this section shall be filed within 3 years after the date 8
[the cause of action accrues] ON WHICH THE MISCLAS SIFIED WORKER LAST 9
PERFORMED WORK FOR T HE ALLEGED EMPLOYER . 10
(c) If the court determines that an [individual] EMPLOYEE or class of 11
[individuals] EMPLOYEES is entitled to judgment in an action against an employer filed in 12
accordance with this section, the court may award each [individual] EMPLOYEE: 13
(1) [any damages to which the individual may be entitled under subsection 14
(a) of this section] ECONOMIC DAMAGES ; 15
(2) an additional amount up to three times the amount of any [such] 16
ECONOMIC damages, if the employer knowingly failed to properly classify the [individual] 17
EMPLOYEE ; 18
(3) reasonable counsel fees and other costs of the action; and 19
(4) any other appropriate relief. 20
(D) IF A FINAL ORDER OF T HE COURT FINDS THAT AN EMPLOYER HAS 21
FAILED TO PROPERLY C LASSIFY AN EMPLOYEE IN A CIVIL ACTION BR OUGHT BY THE 22
ATTORNEY GENERAL, THE ATTORNEY GENERAL SHALL NOTIFY THE AGENCIES 23
LISTED IN § 3–912(A) OF THIS SUBTITLE. 24
(E) BEFORE INITIATING AN ACTION IN ACCORDANCE WITH THIS SUBTITLE , 25
THE ATTORNEY GENERAL MAY CONDUCT A N INVESTIGATION . 26
3–914. 27
(A) (1) IN THIS SECTION THE F OLLOWING WORDS HAVE THE MEANINGS 28
INDICATED. 29
(2) “LICENSE” MEANS A LICENSE , CERTIFICATE, REGISTRATION , 30 26 SENATE BILL 938
PERMIT, OR OTHER AUTHORIZATI ON THAT: 1
(I) IS ISSUED BY A LICEN SING AUTHORITY ; 2
(II) IS SUBJECT TO SUSPEN SION, REVOCATION , FORFEITURE, 3
OR TERMINATION BY A LICENSING AUTHORITY ; AND 4
(III) IS NECESSARY FOR A PERSON TO PRACTICE OR ENGAG E IN 5
A PARTICULAR BUSINES S, OCCUPATION , OR PROFESSION . 6
(3) “LICENSEE” MEANS AN EMPLOYER HO LDING A VALID LICENS E. 7
(4) (I) “LICENSING AUTHORITY ” MEANS A UNIT OF THE DIVISION 8
OF OCCUPATIONAL AND PROFESSIONAL LICENSING IN THE MARYLAND 9
DEPARTMENT OF LABOR. 10
(II) “LICENSING AUTHORITY ” INCLUDES: 11
1. THE ELEVATOR SAFETY REVIEW BOARD; 12
2. THE MARYLAND HOME IMPROVEMENT COMMISSION; 13
3. THE STATE BOARD OF ELECTRICIANS; 14
4. THE STATE BOARD OF HEATING, VENTILATION, 15
AIR–CONDITIONING, AND REFRIGERATION CONTRACTORS ; 16
5. THE STATE BOARD OF PLUMBING; 17
6. THE MARYLAND BOARD OF PUBLIC ACCOUNTANCY ; 18
AND 19
7. THE MARYLAND BOARD OF INDIVIDUAL TAX 20
PREPARERS. 21
(B) (1) THE COMMISSIONER SHALL NO TIFY THE APPLICABLE LICENSING 22
AUTHORITY WHEN A LIC ENSEE IS FOUND IN VI OLATION OF § 3–904 OF THIS 23
SUBTITLE BY A FINAL ORDER OF A COURT OR AN ADMINISTRATIVE UN IT AND: 24
(I) HAS NOT PAID ALL PEN ALTIES ASSESSED UNDE R THIS 25
SUBTITLE FOR A VIOLA TION OF § 3–904 OF THIS SUBTITLE; AND 26
(II) WITHIN 45 DAYS AFTER ISSUANCE OF THE FINAL ORDER O F 27 SENATE BILL 938 27
A COURT OR ADMINISTR ATIVE UNIT, HAS FAILED TO COMPLY WITH A FINAL ORDER 1
ISSUED UNDER § 3–907 OF THIS SUBTITLE FOR FAILING TO PROPERLY CLASSIFY AN 2
EMPLOYEE. 3
(2) THE COMMISSIONER SHALL NOTIFY THE APP LICABLE LICENSING 4
AUTHORITY WHEN A LIC ENSEE IS FOUND IN VI OLATION OF § 3–904 OR § 3–916 OF 5
THIS SUBTITLE BY A F INAL ORDER OF A COUR T OR AN ADMINISTRATI VE UNIT. 6
(C) SUBJECT TO SUBSECTION (D) OF THIS SECTION , IF A LICENSING 7
AUTHORITY RE CEIVES A NOTIFICATIO N MADE UNDER SUBSECT ION (B)(1) OF THIS 8
SECTION, THE LICENSING AUTHOR ITY SHALL SUSPEND OR REVOKE THE LICENSE O F 9
THE LICENSEE. 10
(D) (1) BEFORE SUSPENDING OR REVOKING A LICENSE U NDER 11
SUBSECTION (C) OF THIS SECTION, A LICENSING AUTHORIT Y SHALL SEND WRITTEN 12
NOTICE OF THE PROPOS ED ACTION TO THE LIC ENSEE WHOSE LICENSE IS SUBJECT 13
TO SUSPENSION OR REV OCATION, INCLUDING NOTICE OF THE LICENSEE’S RIGHT TO 14
CONTEST THE IDENTITY OF THE LICENSEE WHOS E LICENSE IS TO BE SUSPENDED OR 15
REVOKED. 16
(2) (I) A LICENSEE MAY APPEAL A DECISION OF A LICE NSING 17
AUTHORITY TO SUSPEND OR REVOKE THE LICENS E IN ACCORDANCE WITH TITLE 10, 18
SUBTITLE 2 OF THE STATE GOVERNMENT ARTICLE. 19
(II) AT A HEARING INITIATE D UNDER SUBPARAGRAPH (I) OF 20
THIS PARAGRAPH , THE ISSUE SHALL B E LIMITED TO WHETHER THE COMMISSIONER 21
HAS MISTAKEN THE IDE NTITY OF THE LICENSE E WHOSE LICENSE HAS BEEN 22
SUSPENDED OR REVOKED . 23
(E) (1) A LICENSING AUTHORITY MAY NOT REINSTATE A LICENSE THAT 24
HAS BEEN SUSPENDED O R REVOKED UNDER SUBS ECTION (C) OF THIS SECTIO N 25
BASED ON A NOTIFICAT ION MADE UNDER SUBSE CTION (B)(1) OF THIS SECTION 26
UNTIL THE COMMISSIONER PROVIDES NOTICE TO THE LICENS ING AUTHORITY 27
UNDER PARAGRAPH (2) OF THIS SUBSECTION . 28
(2) THE COMMISSIONER SHALL NO TIFY THE LICENSING A UTHORITY 29
WITHIN 10 DAYS AFTER THE COMMISSIONER FIRST RE CEIVES: 30
(I) A COURT ORDER TO REI NSTATE THE LICENSE ; OR 31
(II) WITH RESPECT TO A LI CENSEE WHO IS SUBJEC T TO A FINAL 32
ORDER OF A COURT OR AN ADMINISTRATIVE UN IT FOR A VIOLATION O F § 3–904 OF 33
THIS SUBTITLE, NOTICE THAT THE LICENSEE HAS COMPLIE D WITH THE ORDER IN 34 28 SENATE BILL 938
FULL. 1
(3) A LICENSING AUTHORITY SHALL REINSTATE IMME DIATELY A 2
LICENSE THAT WAS SUS PENDED OR REVOKED UN DER SUBSECTION (C) OF THIS 3
SECTION IF: 4
(I) NOTIFIED BY THE COMMISSIONER THAT THE LICENSE 5
SHOULD BE REINSTA TED; AND 6
(II) THE LICENSEE OTHERWI SE QUALIFIES FOR THE LICENSE. 7
(4) WITH RESPECT TO A LIC ENSE THAT HAS BEEN S USPENDED OR 8
REVOKED UNDER SUBSEC TION (C) OF THIS SECTION BASE D ON A NOTIFICATION 9
UNDER SUBSECTION (B)(2) OF THIS SECTION , A LICENSING AUTHO RITY MAY 10
REINSTATE THE LICENS E ONLY IF: 11
(I) THE INDIVIDUAL WHOSE LICENSE HAS BEEN REV OKED OR 12
SUSPENDED SUBMITS A WRITTEN REQUEST TO T HE LICENSING AUTHORI TY; 13
(II) THE LICENSING AUTHOR ITY HOLDS A HEARING ON THE 14
REQUEST; 15
(III) THE LICENSING AUTHOR ITY, BY AN AFFIRMATIVE VO TE OF 16
A MAJORITY OF ITS ME MBERS, DETERMINES THAT ANY CONDITIONS OF THE 17
SUSPENSION OR REVOCA TION HAVE BEEN FULFI LLED AND VOTES TO RE INSTATE 18
THE LICENSE; AND 19
(IV) THE INDIVIDUAL PAYS TO THE LICENSING AUT HORITY A 20
REINSTATEMENT FEE SE T BY THE LICENSING A UTHORITY. 21
(F) (1) ADVERSE LICENSING ACT IONS TAKEN UNDER THI S SECTION MAY 22
BE IMPOSED IN ADDITI ON TO ANY OTHER ACTI ONS TAKEN IN THE ENF ORCEMENT OF 23
THIS SUBTITLE. 24
(2) ADVERSE LICENSING ACT IONS TAKEN UNDER THI S SECTION 25
SHALL BE IN EFFECT A GAINST: 26
(I) A SUCCESSOR CORPORAT ION OR BUSINESS ENTI TY THAT: 27
1. HAS ONE OR MORE OF T HE SAME PRINCIPALS O R 28
OFFICERS AS THE LICE NSEE AGAINST WHOM TH E ADVERSE ACTION WAS TAKEN, 29
UNLESS THE PRINCIPAL OR OFFICER DID NOT O R, WITH THE EXERCISE OF 30
REASONABLE DILIGENCE , COULD NOT HAVE KNOWN OF THE VIOLATION FOR WHICH 31 SENATE BILL 938 29
THE ADVERSE ACTION W AS TAKEN; AND 1
2. IS ENGAGED IN OR INT ENDS TO ENGAGE IN TH E SAME 2
OR EQUIVALENT TRADE OR ACTIVITY; AND 3
(II) AN INDIVIDUAL LICENS EE WHO WA S AN OFFICER , A 4
DIRECTOR, A CONTROLLING SHAREH OLDER, A PARTNER, OR A MANAGER OF THE 5
EMPLOYER AGAINST WHO M THE ADVERSE ACTION WAS TAKEN UNLESS THE 6
OFFICER, DIRECTOR, CONTROLLING SHAREHOL DER, PARTNER, OR MANAGER DID 7
NOT OR, WITH THE EXERCISE OF REASONABLE DI LIGENCE, COULD NOT HAVE KNOWN 8
OF THE VIOLATION FOR WHICH THE ADVERSE AC TION WAS TAKEN . 9
3–915. 10
(a) [Where] IF, after AN investigation, the Commissioner issues a citation for a 11
knowing violation of this subtitle [or regulations adopted under this subtitle] by an 12
employer engaged in work on a contract with a public body, the Commissioner shall 13
promptly notify the public body AND THE GENERAL CONT RACTOR. 14
Article – State Finance and Procurement 15
16–203. 16
(a) A person may be debarred from entering into a contract with the State if the 17
person, an officer, partner, controlling stockholder or principal of that person, or any other 18
person substantially involved in that person’s contracting activities has: 19
(9) been found to have REPEATEDLY , willfully, or knowingly violated Title 20
17, Subtitle 2 or Title 18 of this article if: 21
(i) 1. the finding was made by a court; and 22
2. the decision of the court became final; or 23
(ii) 1. the finding was made in ACCORDANCE WITH A FI NAL 24
ADMINISTRATIVE ORDER OR a contested case under the Administrative Procedure Act; 25
and 26
2. the finding MADE IN A CONTESTED CASE was not 27
overturned on judicial review; 28
(10) been found to have REPEATEDLY , willfully, or knowingly violated Title 29
3, Subtitle 3, Subtitle 4, [or] Subtitle 5, OR SUBTITLE 9 or Title 5 of the Labor and 30
Employment Article if: 31
30 SENATE BILL 938
(i) 1. the finding was made by a court; and 1
2. the decision of the court became final; or 2
(ii) 1. the finding was made in ACCORDANCE WITH A FI NAL 3
ADMINISTRATIVE ORD ER OR a contested case under the Administrative Procedure Act; 4
and 5
2. THE FINDING WAS MADE IN A CONTESTED CASE , the 6
finding was not overturned on judicial review; 7
17–224. 8
(a) (1) If an employee under a public work contract is paid less than the 9
prevailing wage rate for that employee’s classification for the work performed, the employee 10
may file a complaint with the Commissioner. 11
(2) Except as otherwise provided in this section, a complaint filed under 12
this section shall be subject to the provisions of § 17–221 of this subtitle. 13
(3) If the Commissioner’s investigation determines that the employer 14
violated provisions of this subtitle, the Commissioner shall try to resolve the issue 15
informally. 16
(4) (i) If the Commissioner is unable to resolve the matter informally, 17
the Commissioner [shall] MAY: 18
1. issue an order for a hearing in accordance with § 17–221 19
of this subtitle; OR 20
2. REFER THE MATTER TO THE OFFICE OF THE 21
ATTORNEY GENERAL TO FILE A CIV IL ACTION. 22
(ii) If, at the conclusion of a hearing ordered under subparagraph 23
[(i)] (I)1 of this paragraph, the Commissioner determines that the employee is entitled to 24
restitution under this subtitle, the Commissioner shall issue an order in accordance with § 25
17–221 of this subtitle. 26
(iii) If an employer of an employee found to be entitled to restitution 27
under subparagraph (ii) of this paragraph is no longer working under a contract with a 28
public body, the Commissioner may order that restitution be paid directly by the employer 29
to the employee within a reasonable period of time, as determined by the Commissioner. 30
(5) If an employer fails to comply with an order to pay restitution to an 31
employee under paragraph (4)(iii) of this subsection, the Commissioner or the employee 32 SENATE BILL 938 31
may bring a civil action to enforce the order in the circuit court in the county where the 1
employee or employer is located. 2
(b) (1) If an employee under a public work contract is paid less than the 3
prevailing wage rate for that employee’s classification for the work performed, the employee 4
OR THE COMMISSIONER ON BEHAL F OF THE EMPLOYEE is entitled to sue to recover the 5
difference between the prevailing wage rate and the amount received by the employee. 6
(2) IN ACCORDANCE WITH TITLE 6, SUBTITLE 10 OF THE STATE 7
GOVERNMENT ARTICLE, THE ATTORNEY GENERAL MAY SUE TO RE COVER THE 8
DIFFERENCE BETWEEN T HE PREVAILING WAGE R ATE AND THE AMOUNT R ECEIVED 9
BY EMPLOYEES IF : 10
(I) THERE ARE 10 OR MORE AFFECTED EMP LOYEES WHO ARE 11
UNDER A PUBLIC WORK CONTRACT AND ARE PAI D LESS THAN THE PREV AILING 12
WAGE RATE FOR THE CL ASSIFICATION FOR THE WORK PERFORMED ; AND 13
(II) THE AMOUNT OF THE TO TAL WAGES UNDERPAID FOR ALL 14
AFFECTED EMPLOYEES I S NOT LESS THAN $25,000. 15
(3) A determination by the Commissioner that a contractor is required to 16
make restitution under subsection (a)(4) of this section does not preclude an employee from 17
filing an action under this subsection. 18
(c) (1) An action under this section is considered to be a suit for wages. 19
(2) A judgment in an action under this section shall have the same force 20
and effect as any other judgment for wages. 21
(3) An action brought under this section for a violation of this subtitle shall 22
be filed within 3 years from the date the affected employee knew or should have known of 23
the violation. 24
(d) (1) The failure of an employee to protest orally or in writing the payment 25
of a wage that is less than the prevailing wage rate is not a bar to recovery in an action 26
under this section. 27
(2) A contract or other written document in which an employee states that 28
the employee shall be paid less than the amount required by this subtitle does not bar the 29
recovery of any remedy required under this subtitle. 30
(e) (1) Except as provided in paragraph (3) of this subsection, if the court in an 31
action filed under this section finds that an employer paid an employee less than the 32
requisite prevailing wage, the court shall award the affected employee the difference 33
between the wage actually paid and the prevailing wage at the time that the services were 34
rendered. 35 32 SENATE BILL 938
(2) (i) Subject to subparagraph (ii) of this paragraph, unpaid fringe 1
benefit contributions owed for an employee in accordance with this section shall be paid to 2
the appropriate benefit fund, plan, or program. 3
(ii) In the absence of an appropriate benefit fund, plan, or program, 4
the amount owed for fringe benefits for an employee shall be paid directly to the employee. 5
(3) The court may order the payment of double damages or treble damages 6
under this section if the court finds that the employer withheld wages or fringe benefits 7
willfully and knowingly or with deliberate ignorance or reckless disregard of the employer’s 8
obligations under this subtitle. 9
(4) IN ADDITION TO ANY RE LIEF PROVIDED IN ACC ORDANCE WITH 10
PARAGRAPHS (1) THROUGH (3) OF THIS SUBSECTION , THE COMMISSIONER SHALL 11
BE ENTITLED TO AN AW ARD OF LIQUIDATED DA MAGES AS PROVIDED IN § 17–222 OF 12
THIS SUBTITLE. 13
(5) In an action under this section, the court shall award a prevailing 14
plaintiff reasonable counsel fees and costs. 15
[(5)] (6) If the court finds that an employee submitted a false or 16
fraudulent claim in an action under this section, the court may order the employee to pay 17
the employer reasonable counsel fees and costs. 18
[(6)] (7) The contractor and subcontractor shall be jointly and severally 19
liable for any violation of the subcontractor’s obligations under this section. 20
(f) (1) Subject to paragraph (2) of this subsection, an action filed in accordance 21
with this section may be brought by: 22
(I) one or more employees on behalf of: 23
1. that employee or group of employees; and [on behalf of] 24
2. other employees similarly situated; OR 25
(II) THE COMMISSIONER ON BEHAL F OF: 26
1. ONE OR MORE EMPLOYEE S; OR 27
2. ONE OR MORE EMPLOYEES AND OTHER EMPLOYEES 28
SIMILARLY SITUATED . 29
SENATE BILL 938 33
(2) An employee may not be a party plaintiff to an action brought under 1
this section unless that employee files written consent with the court in which the action is 2
brought to become a party to the action. 3
(g) BEFORE INITIATING AN ACTION UNDER THIS SU BTITLE, THE ATTORNEY 4
GENERAL MAY CONDUCT A N INVESTIGATION IN A CCORDANCE WITH TITLE 6, 5
SUBTITLE 10 OF THE STATE GOVERNMENT ARTICLE. 6
(H) (1) A person found to have made a false or fraudulent representation or 7
omission known to be false or made with deliberate ignorance or reckless disregard for its 8
truth or falsity regarding a material fact in connection with any prevailing wage payroll 9
record required by § 17–220 of this subtitle is liable for a civil penalty of $1,000 for each 10
falsified record. 11
(2) The penalty shall be recoverable in a civil action filed in accordance 12
with this section and paid to the State General Fund. 13
[(h)] (I) (1) An employer may not discharge, threaten, or otherwise retaliate 14
or discriminate against an employee regarding compensation or other terms and conditions 15
of employment because that employee or an organization or other person acting on behalf 16
of that employee: 17
[(1)] (I) reports or makes a complaint under this subtitle or otherwise 18
asserts the worker’s rights under this section; or 19
[(2)] (II) participates in any investigation, hearing, or inquiry held by the 20
Commissioner under § 17–221 of this subtitle. 21
(2) IF A VIOLATION OF THI S SUBSECTION IS FOUN D AFTER A HEARING 22
UNDER § 17–221 OF THIS SUBTITLE , THE COMMISSIONER SHALL ORDER THAT THE 23
EMPLOYER: 24
(I) REINSTATE THE EMPLOY EE OR PROVIDE THE EM PLOYEE 25
RESTITUTION, AS APPROPRIATE ; AND 26
(II) PAY THE EMPLOYEE AN AMOUNT EQUAL TO THRE E TIMES 27
THE AMOUNT OF BACK W AGES AND FRINGE BENEFITS CALC ULATED FROM THE DATE 28
OF THE VIOLATION . 29
[(i)] (J) (1) A contractor or subcontractor may not retaliate or discriminate 30
against an employee in violation of this section. 31
(2) If a contractor or subcontractor retaliates or discriminates against an 32
employee in violation of this section, the affected employee OR THE COMMISSIONER ON 33 34 SENATE BILL 938
BEHALF OF THE EMPLOY EE may file an action in any court of competent jurisdiction 1
within 3 years from the employee’s knowledge of the action. 2
(3) If the court finds in favor of the employee in an action brought under 3
this subsection, the court shall order that the contractor or subcontractor: 4
(i) reinstate the employee or provide the employee restitution, as 5
appropriate; 6
(ii) pay the employee an amount equal to three times the amount of 7
back wages and fringe benefits calculated from the date of the violation; and 8
(iii) pay reasonable counsel fees and other costs. 9
18–109. 10
(a) (1) If an employee was paid less than the wage rate required under this 11
title the employee OR THE COMMISSIONER ON BEHAL F OF THE EMPLOYEE AN D OTHER 12
EMPLOYEES SIMILARLY SITUATED is entitled to sue to recover the amount of the 13
difference between the wage rate required under this title and the amount received by the 14
employee. 15
(2) A determination by the Commissioner that an employer is required to 16
make restitution does not preclude an employee from filing an action under this section. 17
(3) IN AN ACTION BROUGHT BY THE COMMISSIONER UNDER TH IS 18
SECTION, THE COMMISSIONER SHALL BE ENTITLED TO RECOVER LIQ UIDATED 19
DAMAGES AS PROVIDED IN § 18–108 OF THIS SUBTITLE. 20
(b) (1) An action under this section is considered to be a suit for wages. 21
(2) A judgment in an action under this section shall have the same force 22
and effect as any other judgment for wages. 23
(c) The failure of an employee to protest orally or in writing the payment of a 24
wage that is less than the wage rate required under this title is not a bar to recovery in an 25
action under this section. 26
Article – State Government 27
SUBTITLE 10. WORKER PROTECTION UNIT. 28
6–1001. 29
(A) IN THIS SUBTITLE THE FOLLOWING WORDS HAVE THE MEANINGS 30
INDICATED. 31 SENATE BILL 938 35
(B) (1) “ECONOMIC DAMAGES ” MEANS ANY FINANCIAL LOSS INCURRED 1
BY A WORKER AS A RES ULT OF RETALIATION B Y A PERSON IN VIOLAT ION OF THIS 2
SUBTITLE. 3
(2) “ECONOMIC DAMAGES ” INCLUDES: 4
(I) UNPAID WAGES ; AND 5
(II) LOST BENEFITS. 6
(C) “EMPLOYER” MEANS ANY PERSON , OR A SUCCESSOR OF TH E PERSON, 7
EMPLOYING ONE OR MOR E INDIVIDUALS IN THE STATE. 8
(D) “SUCCESSOR” MEANS AN EMPLOYER THAT ACQ UIRES, THROUGH ANY 9
FORM OF TRANSACTION , THE BUSINESS OPERATI ONS, ASSETS, WORKFORCE OR 10
OTHER SIGNIFICANT EL EMENTS OF ANOTHER EM PLOYER, AND CONTINUES TO 11
OPERATE THE BUSINESS IN ESSENTIALLY THE S AME MANNER AS THE PR EVIOUS 12
EMPLOYER. 13
(E) “UNIT” MEANS THE WORKER PROTECTION UNIT. 14
(F) “WORKER” MEANS AN INDIVIDUAL PERFORMING SERVICES FOR 15
REMUNERATION , INCLUDING AN EMPLOYE E AND INDIVIDUAL CLA SSIFIED OR 16
ALLEGED TO BE INDEPE NDENT CONTRACTORS , REGARDLESS OF THE LE GAL 17
RELATIONSHIP BETWEEN THE PARTIES. 18
(G) “WORKERS’ RIGHTS LAWS” MEANS THE STATUTES A ND REGULATIONS 19
DESIGNED TO SAFEGUAR D THE RIGHTS OF WORK ERS, INCLUDING: 20
(1) TITLE 17, SUBTITLE 2 OF THE STATE FINANCE AND 21
PROCUREMENT ARTICLE; 22
(2) THE MARYLAND WAGE AND HOUR LAW; 23
(3) TITLE 3, SUBTITLE 9 OF THE LABOR AND EMPLOYMENT ARTICLE; 24
(4) THE MARYLAND WAGE PAYMENT AND COLLECTION LAW; AND 25
(5) ANY OTHER LAW THAT T HE ATTORNEY GENERAL IS EMPOWERED 26
TO USE TO PROTECT WO RKERS’ RIGHTS. 27
6–1002. 28 36 SENATE BILL 938
(A) THERE IS A WORKER PROTECTION UNIT IN THE OFFICE OF THE 1
ATTORNEY GENERAL. 2
(B) THE PURPOSE OF THE UNIT IS TO PROTECT TH E RIGHTS OF WORKERS 3
WITHIN THE STATE, INCLUDING ENSURING C OMPLIANCE WITH ANY W ORKERS’ 4
RIGHTS LAWS BY INVES TIGATING AND PROSECU TING VIOLATIONS OF T HE WORKERS ’ 5
RIGHTS LAWS. 6
6–1003. 7
THIS SUBTITLE MAY N OT BE CONSTRUED TO T AKE AWAY OR LIMIT TH E 8
POWERS OF THE ATTORNEY GENERAL. 9
6–1004. 10
THE ATTORNEY GENERAL MAY BRING A C IVIL ACTION IN A COU RT OF 11
COMPETENT JURISDICTI ON AGAINST AN EMPLOY ER OR OTHER PERSON V IOLATING 12
A WORKERS’ RIGHTS LAW FOR RESTI TUTION OR FOR INJUNCTIVE , COMPENSATORY , 13
PUNITIVE, OR OTHER AUTHORIZED RELIEF FOR A WORKER , AN EMPLOYEE , OR THE 14
PUBLIC AT LARGE . 15
6–1005. 16
(A) THE UNIT SHALL INCLUDE : 17
(1) A FULL–TIME CHIEF COUNSEL ; AND 18
(2) STAFF, INCLUDING ASSISTANT ATTORNEYS GENERAL , 19
INVESTIGATORS , ADMINISTRATORS , AND ANY OTHER PERSON NEL APPOINTED BY 20
AND AT THE DISCRETIO N OF THE ATTORNEY GENERAL. 21
(B) SALARIES OF THE CHIEF COUNSEL AND STAFF AN D EXPENSES FOR 22
RENT, TRAVEL, EQUIPMENT, SUPPLIES, AND GENERAL OPERATIN G EXPENSES 23
NECESSARY FOR THE WO RK OF THE UNIT SHALL BE AS PROV IDED IN THE STATE 24
BUDGET. 25
(C) THE ATTORNEY GENERAL SHALL SET MIN IMUM SALARIES , 26
QUALIFICATIONS , AND STANDARDS OF TRA INING AND EXPERIENCE FOR POSITIONS 27
WITHIN THE UNIT. 28
6–1006. 29
SENATE BILL 938 37
THE ATTORNEY GENERAL MAY ADOPT REG ULATIONS TO CARRY OU T THIS 1
SUBTITLE. 2
6–1007. 3
(A) ON THE ATTORNEY GENERAL’S OWN INITIATIVE OR IN RESPONSE TO A 4
COMPLAINT, THE ATTORNEY GENERAL MAY INVESTIGA TE AS NECESSARY TO 5
DETERMINE COMPLIANCE WITH THE WORKE RS’ RIGHTS LAWS. 6
(B) (1) IN CONDUCTING AN INVE STIGATION UNDER SUBS ECTION (A) OF 7
THIS SECTION, THE ATTORNEY GENERAL MAY: 8
(I) ENTER AND INSPECT A PERSON’S PLACE OF BUSINESS OR 9
PLACE OF WORK TO : 10
1. OBSERVE WORK BEING P ERFORMED ; AND 11
2. EXAMINE AND COPY: 12
A. RECORDS THAT A PERSO N IS REQUIRED TO KEE P IN 13
ACCORDANCE WITH TITLE 3 OF THE LABOR AND EMPLOYMENT ARTICLE OR TITLE 14
17, SUBTITLE 2 OF THE STATE FINANCE AND PROCUREMENT ARTICLE; 15
B. BOOKS, REGISTERS, PAYROLL RECORDS , RECORDS OF 16
WAGE WITHHOLDINGS , RECORDS OF WORK ACTI VITY AND HOURS OF WO RK, AND 17
RECORDS OR INDICIA O F THE EMPLOYMENT STA TUS OF WORKERS PERFO RMING 18
WORK FOR THE PERSON ; OR 19
C. ANY OTHER RECORDS RE LATING TO COMPLIANCE 20
WITH THE WORKERS ’ RIGHTS LAWS OR REGUL ATIONS ADOPTED UN DER THE 21
WORKERS’ RIGHTS LAWS; 22
(II) REQUIRE A PERSON TO PRODUCE, WITHIN 15 CALENDAR 23
DAYS, A TRUE AND CORRECT C OPY OF AN ITEM DESCR IBED IN ITEM (I)2 OF THIS 24
PARAGRAPH ; 25
(III) DETERMINE THE IDENTI TY AND ACTIVITIES OF ANY 26
WORKER RECEIVING REM UNERATION F ROM A PERSON ; AND 27
(IV) CONDUCT CONFIDENTIAL INTERVIEWS AND OBTAI N ORAL 28
OR WRITTEN STATEMENT S FROM A WORKER RELA TING TO INFORMATION 29
CONCERNING THE REMUN ERATION OF WORKERS A ND THE NATURE AND EX TENT OF 30
THE SERVICES PERFORM ED. 31 38 SENATE BILL 938
(2) THE ATTORNEY GENERAL M AY CONDUCT THE ACTIV ITIES 1
DESCRIBED IN PARAGRA PH (1) OF THIS SUBSECTION A T: 2
(I) A LOCATION WHERE WOR KERS ARE ENGAGED TO PERFORM 3
WORK FOR ANY PERSON ; AND 4
(II) ANY OTHER LOCATION W HERE THE RECORDS DES CRIBED IN 5
PARAGRAPH (1)(I) OF THIS SUBSECTION A RE MAINTAINED BY A PERS ON OR AN 6
AGENT OF THE PERSON . 7
(C) AT THE DISCRETION OF THE ATTORNEY GENERAL, THE UNIT MAY 8
REFER A MATTER TO A FEDERAL, STATE, OR LOCAL GOVERNMENT ENFORCEMENT 9
AGENCY OR UNIT . 10
6–1008. 11
(A) IF THE ATTORNEY GENERAL IS DENIED ACC ESS TO A PLACE OF WORK 12
OR PLACE OF BUSINESS AFTER MAKING A PROPE R REQUEST TO THE OWN ER, 13
LESSEE, EMPLOYER, OR OTHER PERSON IN C HARGE OF ACCESS TO T HE PLACE OF 14
BUSINESS OR PLACE OF WORK, THE ATTORNEY GENERAL MAY APPLY TO THE 15
DISTRICT COURT FOR AN ADMINIST RATIVE SEA RCH WARRANT UNDER TH IS 16
SECTION. 17
(B) EACH APPLICATION UNDE R THIS SECTION SHALL : 18
(1) STATE THE NATURE , PURPOSE, AND SCOPE OF THE INS PECTION; 19
AND 20
(2) SHOW THAT: 21
(I) THE APPLICANT IS AUT HORIZED BY LAW TO IN SPECT THE 22
PLACE OF BUSINESS OR PLACE OF WO RK TO WHICH ACCESS W AS DENIED; 23
(II) REQUESTED ACCESS WAS AT A REASONABLE TIME ; 24
(III) ACCESS WAS DENIED ; AND 25
(IV) THE INSPECTION IS FO R A PURPOSE RELATED TO THIS 26
SUBTITLE. 27
(C) ON A SHOWING OF PROBA BLE CAUSE, THE DISTRICT COURT SHALL 28
ISSUE THE ADMINISTRATIVE SEARC H WARRANT AUTHORIZIN G THE ATTORNEY 29 SENATE BILL 938 39
GENERAL OR AUTHORIZED REPRESENTATIVE TO EN TER AND INSPECT THE PLACE 1
OF BUSINESS OR PLACE OF WORK, EXAMINE AND COPY REC ORDS, AND TAKE OTHER 2
NECESSARY ACTIONS TO ENFORCE THIS SUBTITL E. 3
6–1009. 4
(A) TO CARRY OUT A DUTY OR EXERCISE A POWER UND ER THIS SUBTITLE , 5
THE ATTORNEY GENERAL OR AUTHORIZED REPRESENTATIVE OF TH E ATTORNEY 6
GENERAL MAY ADMINISTE R OATHS AND QUESTION WITNESSES ON RECORD AND 7
UNDER OATH . 8
(B) (1) TO ADMINISTER OR ENFO RCE THIS TITLE , THE ATTORNEY 9
GENERAL OR AN AUTHORI ZED REPRESENTATIVE M AY ISSUE A SUBPOENA FOR THE 10
ATTENDANCE OF A WITN ESS TO TESTIFY OR TH E PRODUCTION OF BOOK S, 11
DOCUMENTS , PAPERS, AND RECORDS . 12
(2) IF A PERSON FAILS TO COMPLY WITH A SUBPOE NA ISSUED UNDER 13
PARAGRAPH (1) OF THIS SUBSECTION OR FAILS TO TESTIFY ON A MATT ER ON WHICH 14
THE PERSON LAWFULLY MAY BE INTERROGATED , ON A COMPLAINT FILED BY THE 15
ATTORNEY GENERAL, THE CIRCUIT COURT FO R THE COUNTY IN WHIC H THE PERSON 16
RESIDES OR IS PRESEN T MAY PASS AN ORDER DIRECTING COMPLIANCE WITH THE 17
SUBPOENA OR COMPELLI NG TESTIMONY . 18
(C) A PERSON MAY NOT BE EX CUSED FROM : 19
(1) ATTENDING AND TESTIF YING; OR 20
(2) PRODUCING A DOCUMENT OR RECORD BEFORE THE ATTORNEY 21
GENERAL OR IN A PROCE EDING INITIATED BY T HE ATTORNEY GENERAL ON THE 22
GROUNDS THAT THE TES TIMONY OR EVIDENCE M AY INCRIMINATE THE P ERSON OR 23
SUBJECT THE PERSON T O A PENALTY OR FORFE ITURE. 24
(D) EXCEPT IN CASE S OF PERJURY OR CONT EMPT, TESTIMONY OR 25
EVIDENCE OBTAINED UN DER SUBSECTION (B)(1) OF THIS SECTION MAY NOT BE 26
USED TO CRIMINALLY P ROSECUTE THE INDIVID UAL FOR THE SPECIFIC SUBJECT 27
THEY WERE COMPELLED TO TESTIFY OR PRODUC E EVIDENCE ABOUT . 28
6–1010. 29
(A) IN THIS SECTION, “RETALIATION” INCLUDES: 30
40 SENATE BILL 938
(1) ADVERSE ACTIONS AFFE CTING THE TERMS AND CONDITIONS OF 1
WORK OR EMPLOYMENT , SUCH AS TERMINATION , DEMOTION, REASSIGNMENT , 2
RELOCATION , CHANGE OF SCHEDULE , OR SUSPENSION ; 3
(2) HARASSMENT OR INTIMI DATION IN THE WORKPL ACE; AND 4
(3) AN ACTION THAT WOULD DISCOURAGE A WORKER FROM 5
PARTICIPATING IN AN INVESTIGATION OR A P ROCEEDING UNDER THIS TITLE OR 6
OTHERWISE EXERCISE A NY RIGHT AFFORDED BY THIS TITLE. 7
(B) AN EMPLOYER OR ANOTHE R PERSON MAY NOT DIS CHARGE, DEMOTE, 8
HARASS, OR OTHERWISE RETALIAT E AGAINST A WORKER W HO: 9
(1) REPORTS OR MAKES A C OMPLAINT TO THE ATTORNEY GENERAL 10
OF A VIOLATION OF WORKERS’ RIGHTS LAWS; 11
(2) PARTICIPATES IN AN I NVESTIGATION OR PROC EEDING UNDER 12
THIS SUBTITLE; OR 13
(3) OTHERWISE EXERCISES ANY RIGHT AFFORDED BY TH IS SUBTITLE. 14
(C) (1) A WORKER WHO BELIEVES THAT THE WORKER HAS BEEN 15
RETALIATED AGAINST I N VIOLATION OF SUBSE CTION (B) OF THIS SECTION MAY FILE 16
A COMPLAINT WITH THE ATTORNEY GENERAL. 17
(2) THE ATTORNEY GENERAL MAY INVESTIGA TE A COMPLAINT IN 18
ACCORDANCE WITH § 6–1007 OF THIS SUBTITLE. 19
(D) THE ATTORNEY GENERAL MAY FILE AN A CTION ON BEHALF OF A NY 20
WORKER FOUND BY THE ATTORNEY GENERAL TO HAVE BEEN RETALIATED AGAINST 21
IN VIOLATION OF THIS SUBTITLE IN ANY COUR T OF COMPETENT JURIS DICTION 22
WITHIN 3 YEARS FROM THE LAST INSTANCE OF RETALIAT ION. 23
(E) IF THE COURT FINDS IN FAVOR OF THE WORKER IN AN ACTION BROUGHT 24
UNDER SUBSECTION (D) OF THIS SECTION , THE COURT SHALL ORDE R, AS 25
APPROPRIATE , THAT THE EMPLOYER OR OTHER PERSON : 26
(1) REINSTATE THE WORKER OR PROVIDE TH E WORKER 27
RESTITUTION; AND 28
(2) PAY: 29
(I) ECONOMIC DAMAGES ; 30 SENATE BILL 938 41
(II) AN AMOUNT TO THE WOR KER THAT IS EQUAL TO THREE 1
TIMES THE AMOUNT OF ECONOMIC DAMAGES CAL CULATED FROM THE DAT E OF THE 2
VIOLATION; 3
(III) COMPENSATORY AND PUN ITIVE DAMAGES; OR 4
(IV) REASONABLE COUNSEL F EES AND OTHER COSTS TO THE 5
ATTORNEY GENERAL. 6
SECTION 4. AND BE IT FURTHER ENACTED, That this Act shall take effect 7
October 1, 2025. 8