PRINTER'S NO. 607
THE GENERAL ASSEMBLY OF PENNSYLVANIA
SENATE BILL
No.602
Session of
2025
INTRODUCED BY KANE, TARTAGLIONE, SAVAL, SANTARSIERO, STREET,
HUGHES, KEARNEY, HAYWOOD, FONTANA, COSTA AND SCHWANK,
APRIL 9, 2025
REFERRED TO LABOR AND INDUSTRY, APRIL 9, 2025
AN ACT
Providing for the registration of labor brokers; imposing duties
on the Department of Labor and Industry and the Secretary of
Labor and Industry; establishing the Labor Broker
Registration Account; and imposing penalties.
TABLE OF CONTENTS
Section 1. Short title.
Section 2. Definitions.
Section 3. Prohibition.
Section 4. Proof of registration.
Section 5. Verification system.
Section 6. Registration.
Section 7. Expiration and renewal.
Section 8. Certification of compliance.
Section 9. Reporting changes.
Section 10. Fees.
Section 11. Labor Broker Registration Account.
Section 12. Prohibited acts.
Section 13. Investigations.
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18 Section 14. Penalties.
Section 15. Suspension of registration.
Section 16. Other relief.
Section 17. Regulations.
Section 18. Effective date.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. Short title.
This act shall be known and may be cited as the Labor Broker
Registration Act.
Section 2. Definitions.
The following words and phrases when used in this act shall
have the meanings given to them in this section unless the
context clearly indicates otherwise:
"Account." The Labor Broker Registration Account established
under section 11.
"Construction." Erection, reconstruction, demolition,
alteration, modification, custom fabrication, building,
assembling, site preparation and repair work done on any real
property or premises under contract, whether or not the work is
for a public body and paid for from public funds.
"Debar." As follows:
(1) Action taken by the secretary to prohibit a
contractor, subcontractor or person from contracting with or
participating in contracts for public work for a period of at
least three years.
(2) The debarment shall include all divisions or other
organizational elements of a contractor or subcontractor
unless limited by its terms to specific divisions or
organizational elements.
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30 (3) The debarment may apply to affiliates or other
persons or entities associated with the contractor,
subcontractor or individual if they are specifically named
and given written notice of the debarment and an opportunity
to appeal.
(4) The debarment shall apply to a successor entity. An
entity shall be a successor entity if it:
(i) has one or more of the same principals or
officers as the employer against whom the order was
issued;
(ii) performs similar work within the same
geographical area;
(iii) occupies the same premises;
(iv) shares the same telephone number or facsimile
number;
(v) has the same email address or Internet website;
(vi) employs substantially the same workforce or
administrative employees, or both;
(vii) utilizes the same tools, equipment or
facilities;
(viii) employs or engages the services of any person
or persons involved in the direction or control of the
other; or
(ix) lists substantially the same work experience.
"Department." The Department of Labor and Industry of the
Commonwealth.
"Employee." As follows:
(1) An individual performing a service or labor for an
employer for wages, remuneration or other compensation.
(2) The term includes:
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30 (i) In relation to workers' compensation, as the
term "employe" is defined in section 104 of the Workers'
Compensation Act.
(ii) In relation to unemployment compensation, as
the term "employe" is defined in section 4(i) of the
Unemployment Compensation Law.
"Employer." As follows:
(1) A person, including an agent of the person, that
engages the services of an employee for wages, remuneration
or other compensation.
(2) The term includes:
(i) In relation to workers' compensation, as the
term "employer" is defined in section 103 of the Workers'
Compensation Act.
(ii) In relation to unemployment compensation, as
the term "employer" is defined in section 4(j) of the
Unemployment Compensation Law.
"Labor broker." As follows:
(1) An entity or individual that supplies construction
workers to an employer for the performance of construction
work or for a construction project of the employer on a site
in this Commonwealth in exchange for compensation from the
employer, provided that the completion of the project is
directed by the employer and not the entity or individual.
(2) The term does not include a construction
subcontractor that is responsible for and carries out all of
the following:
(i) Performing construction work on a project in
accordance with a written contract for a defined scope of
construction work at a fixed price.
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30 (ii) Obtaining necessary licenses or permits to
perform construction services under the entity's or
individual's name.
(iii) Exclusively controlling the work of any
subcontractor, including the authority to hire and fire
and to direct the methods and means of construction work
performed on the construction project.
(iv) Paying wages and fringe benefits to workers
through any subcontractor and not through any other
entity or individual and maintaining required employment
and payroll records by the subcontractor.
(v) Purchasing the majority of materials, supplies
and tools for construction work performed by the
subcontractor on the construction project.
(vi) Maintaining workers' compensation and
unemployment insurance coverage for periods preceding,
during and succeeding the terms of the construction
project for the type and scope of construction performed
by the subcontractor on the construction project.
"Person." An individual, firm, sole proprietorship,
partnership, corporation, association or other entity.
"Public body." Any of the following:
(1) The Commonwealth.
(2) A political subdivision, including a county, city,
borough, incorporated town, township or municipal authority,
of this Commonwealth.
(3) An authority created by the General Assembly.
(4) An instrumentality or agency of the Commonwealth.
(5) A school district of this Commonwealth.
"Secretary." The Secretary of Labor and Industry of the
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30 Commonwealth or the authorized representative of the Secretary
of Labor and Industry.
"Unemployment Compensation Law." The act of December 5, 1936
(2nd Sp.Sess., 1937 P.L.2897, No.1), known as the Unemployment
Compensation Law.
"Workers' Compensation Act." The act of June 2, 1915
(P.L.736, No.338), known as the Workers' Compensation Act.
Section 3. Prohibition.
A person may not hold oneself out or engage in any act as a
labor broker without satisfying the registration requirements
under this act.
Section 4. Proof of registration.
A labor broker shall include the labor broker's registration
number issued by the department in all advertisements
distributed within this Commonwealth and on all contracts,
estimates and related documents created after the effective date
of this section.
Section 5. Verification system.
The department shall develop and maintain a list of completed
registrations under this act on the department's publicly
accessible Internet website, which shall include each labor
broker's legal business name, any assumed business name,
business address, verification number and verification
expiration date.
Section 6. Registration.
(a) Application.--A labor broker shall apply, in writing or
electronically, for registration in a manner and on a form
prescribed by the department.
(b) Contents.--The registration form shall include the
following information:
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30 (1) For any individual, sole proprietor, primary owner
or officer of a business entity, all of the following
information:
(i) The applicant's full legal name and title at the
applicant's business.
(ii) The applicant's business address and telephone
number.
(iii) The applicant's Federal identification number
or Federal tax identification number used for business
purposes.
(iv) All prior business names and addresses of the
applicant.
(v) A statement whether:
(A) the applicant, even in doing so as part of a
business entity application, has ever been convicted
of, or pleaded guilty or no contest to, a criminal
offense related to fraud, theft, a crime of
deception, a crime involving fraudulent business
practices or employee misclassification;
(B) the applicant, even if doing so as part of a
business entity application, has ever been found to
have misclassified employees as independent
contractors by the department, any other state or
political subdivision or the United States Department
of Labor; and
(C) the applicant's certification or a similar
certificate or license issued by any other state or
political subdivision has ever been revoked or
suspended pursuant to an order issued by a court of
competent jurisdiction and, if so, the current status
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30 of the certification or similar certificate or
license. The statement required by this clause shall
include the same information with respect to any
other business in which the applicant has or has ever
had an interest.
(2) The legal business name, any assumed business name,
designated business address, physical address, telephone
number and email address of the applicant.
(3) For an out-of-State business entity, the legal
business name, any assumed business name, designated business
address, physical address, telephone number and email address
of the applicant and any identification number issued to the
applicant by the applicant's state or political subdivision
through registration, licensing or verification systems, if
applicable.
(4) For any individual, sole proprietor, primary owner
or officer, including a chief executive officer, chief
financial officer, chief operating officer or an equivalent
officer, of a business entity, the name of all other persons
with an ownership interest in the applicant that are not
identified under paragraph (1). This paragraph does not apply
to shareholders with less than a 5% ownership interest in a
publicly traded corporation.
(5) A description of the nature of the business of the
applicant.
(6) Whether the applicant has been suspended or debarred
within the last 10 years.
(7) Proof of financial responsibility, which may include
liability insurance or bonding, or self-insurance.
(8) The fee specified under section 10.
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30 (9) A signed statement by the applicant that the
information in the application is true and accurate and any
individual signing the application is an authorized agent of
the applicant subject to the penalties under 18 Pa.C.S.
ยง 4904 (relating to unsworn falsification to authorities) .
Section 7. Expiration and renewal.
(a) Dates.--The registration shall be completed on a fixed,
biennial basis on a date determined by the department.
(b) Acceptance.--The department shall accept an application
for a registration renewal before the expiration of an active
registration in a time frame specified by the department.
Section 8. Certification of compliance.
After a labor broker completes an application for
registration or registration renewal under this act and pays the
fee specified under section 10, the department shall issue a
certificate of compliance to the labor broker that includes a
registration number.
Section 9. Reporting changes.
A labor broker shall update its registration within 30 days
of any change in personal or business information required to be
provided to the department under this act.
Section 10. Fees.
(a) Amount.--An applicant for registration or registration
renewal under this act shall pay an application fee of not more
than $300 to the department.
(b) Deposit.--Fees under subsection (a) shall be deposited
into the account.
Section 11. Labor Broker Registration Account.
(a) Establishment.--The Labor Broker Registration Account is
established as a restricted revenue, interest-bearing account in
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30 the General Fund.
(b) Deposit.--The department shall deposit fees and
penalties collected under this act into the account.
(c) Appropriation.--Money in the account and interest earned
on the money are appropriated on a continuing basis to the
department for administering and enforcing the provisions of
this act.
Section 12. Prohibited acts.
(a) Specific prohibitions.--On or after the effective date
of this subsection, a person who holds oneself out or engages in
any act as a labor broker may not do any of the following:
(1) Fail to complete the registration as a labor broker
as required under this act.
(2) Fail to display or identify its registration number
as required under section 4.
(3) Knowingly make a false statement in the application
for labor broker registration.
(4) Knowingly contract with or perform work as a labor
broker for another person:
(i) without first completing the registration
required under this act; or
(ii) after the registration required under this act
has expired or has been suspended.
(5) Knowingly contract with or pay another person for
work as a labor broker if:
(i) the person has not completed the registration
required under this act; or
(ii) the person's registration required under this
act has expired or has been suspended.
(b) Verification.--A person seeking to contract or engage
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30 with a purported labor broker shall verify the registration of
the purported labor broker using the verification system
described in section 5.
(c) Unregistered labor broker.--
(1) A person, including an agent of a person, may not
contract with or engage the services of an unregistered labor
broker.
(2) A person found to have engaged with an unregistered
labor broker shall be subject to penalties described under
section 14.
Section 13. Investigations.
(a) Authorization.--If the secretary receives information
indicating that a person has violated this act, the secretary
may investigate the matter.
(b) Permitted actions.--The secretary may take any of the
following actions:
(1) Enter and inspect a worksite or place of business at
any reasonable time to examine and inspect records that
relate to the compliance of this act.
(2) Subpoena witnesses, administer oaths, examine
witnesses and copy or compel the production of records,
contracts and other documents that are necessary and
appropriate to the enforcement of this act.
(3) Petition Commonwealth Court to enforce any subpoena
or order issued by the department under this act.
Section 14. Penalties.
The following penalties apply:
(1) A person that violates section 12(a)(1) or (2) shall
be subject to the following:
(i) For a first violation, the department shall
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30 issue a warning letter to the person detailing the
omission and provide 30 days to correct the violation.
(ii) For a second or subsequent violation, the
department shall bring an administrative action to assess
a fine of up to $2,500 for each day that the labor broker
is not registered.
(2) For a violation of section 12(a)(3), (4) or (5), the
department shall bring an administrative action to assess a
fine of up to $10,000 per violation.
(3) A person that violates section 12(b) or (c) shall be
subject to the following:
(i) For a first violation, the department shall
issue a fine of no more than $25,000.
(ii) For a second or any subsequent violations, the
department shall issue a fine not to exceed $25,000 per
day per worker provided by the unregistered labor broker.
(4) The secretary may debar or prohibit a person from
registering as a labor broker that violates any of the
provisions of section 12.
(5) The secretary shall waive a penalty for a violation
of section 12(a)(5), (b) or (c) by a person if the person or
employer is able to provide evidence to the secretary of a
good faith effort to comply with this act. The secretary
shall determine that a person has provided evidence of a good
faith effort under this paragraph if the person can prove to
the department that the person verified the registration of a
labor broker under section 5 and the labor broker was
registered in accordance with this act at the time of the
verification.
Section 15. Suspension of registration.
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30 (a) Reasons.--The secretary may suspend a labor broker's
registration for failing to comply with an investigation under
section 13, failing to pay penalties imposed in accordance with
section 14 or otherwise failing to correct a violation as
required by section 14.
(b) Appeal.--A suspension under subsection (a) shall be
subject to appeal of the administrative action.
Section 16. Other relief.
In addition to the penalties specified under this act, the
department may seek other relief, including injunctive relief
and costs, reasonable attorney fees and investigation costs.
Section 17. Regulations.
The department may promulgate regulations as necessary to
implement this act.
Section 18. Effective date.
This act shall take effect in one year.
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