The bill is set to take effect on July 1, 2023, and will require state agencies that engage in public contracts to incorporate these provisions into their contracts. The implication of this bill is significant as it reinforces the State's commitment to supporting both contractors and employees by ensuring that wages reflect the mandated increases related to the state minimum wage. This alignment is important in maintaining the viability of public contracts across the state.
Summary
Senate Bill 98 addresses public contracting in the state of New Mexico by mandating that contracts for services include provisions to ensure that contractor and subcontractor reimbursement rates and wage increases for employees align with state minimum wage increases. This bill aims to protect contractors from the financial impacts associated with rising minimum wages and to guarantee that workers employed under such contracts receive timely wage adjustments that reflect changing state laws regarding minimum wage.
Contention
While proponents of SB 98 argue that it provides much-needed protection for workers and prevents wage stagnation among public contract employees, opponents may raise concerns about the potential burden that these requirements could impose on smaller contractors. Critics might argue that mandatory reimbursement provisions could deter smaller businesses from bidding on state contracts, especially in a tight economic climate where labor costs are already escalating. The discussions surrounding the bill could reveal a tension between the aim of supporting wage increases for workers and the impact of those increases on the competitive landscape for public contracts.