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Prevailing Wage Law Added in Anne Arundel County, Maryland

Posted by National Alliance for Fair Contracting on

July 1, 2022

Prevailing Wage Law

Beginning with contracts executed on July 1, 2022, the Prevailing Wage and Local Hiring Law applies and is patterned after the Federal Davis-Bacon and State of Maryland’s prevailing wage laws. See Anne Arundel County Bill 72-21. It requires the prevailing wage be paid to workers on County-financed construction contracts as required by Anne Arundel County’s Laws; and also adds local hiring requirements as applicable. The prevailing wage rate is the rate paid for comparable work in the private sector within the County. The County’s Wage Determinations are subject to the State of Maryland Wage Determination rates for Anne Arundel County for Highway Construction and/or Building Construction. Job classifications not listed, Vendors will be required to request a rate determination with the Request for Additional Wage Rates from the Maryland Division of Labor and Industry. In the event of a conflict between the County prevailing wage and local hiring statutes, the statute shall control.

It is the responsibility of each contractor and bidder submitting a quote or solicitation to Anne Arundel County to read, certify and attest to the County that they have read and agree to be bound by the prevailing wage and local hiring requirements of the County, including these guidelines, and agree to be bound to them. An affidavit must be provided attesting to the same in such form and substance as required by the County upon demand as an incorporated requirement to any contract or agreement.

In the event the state or federal prevailing wage law applies, the requirements of Maryland state law or federal law shall apply, provided however that local hiring requirements may still also concurrently apply. If the state prevailing wage applies, additional requirements as set forth in COMAR and state statute will be applicable including, but not limited to, notices to independent contractor and withholding of last payments for contracts until a certification and attestation is received by the County evidencing that all employees and contractors have been paid in accordance with state prevailing wage requirements.

(See Article)

Baltimore increases prevailing wage for construction trades

Posted by National Alliance for Fair Contracting on

By: Daily Record Staff
March 18, 2022

Baltimore Mayor Brandon Scott and members of the Board of Estimates (BOE) approved an increase in the city’s prevailing wage for workers in the construction trades.

The increase would boost the base rate for laborers from $8 per hour to $22 per hour, totaling an approximate rate of $43,000 annually. The Prevailing Wages for Workers Under Construction Contracts law, among other things, requires workers to be paid regularly and no less than the approved prevailing wage.

This decision comes after the Baltimore City Wage Commission, housed within the Office of Equity and Civil Rights (OECR), reviewed the 2021 wage rates – and years prior – compared to wages for similar trades in surrounding jurisdictions.

This process was guided by an equitable lens, in line with Scott’s commitment to leveling the playing field in Baltimore, even for the city’s most overlooked workers. As a result, it was determined that the rates for laborers needed to be significantly increased.

This increase pertains to Baltimore construction contracts with a minimum value of $5,000 and applies to laborers, mechanics and apprentices working in all construction trades. The Baltimore City prevailing wage law can be found in the Baltimore City Charter, Article 5, Subtitle 25.

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AG Frosh Joins Suit to Safeguard Key Protections for Workers in the Fair Labor Standards Act (MD)

Posted by National Alliance for Fair Contracting on

Unlawful Department of Labor Rule Will Increase Wage Theft for Workers

February 27, 2020
News Release, Office of the Maryland Attorney General

BALTIMORE, MD (February 26, 2020) – Maryland Attorney General Brian E. Frosh today joined a coalition of 18 attorneys general in filing a lawsuit to stop the Trump Administration from eliminating key labor protections for workers.

The lawsuit challenges a United States Department of Labor (USDOL) rule that seeks to unlawfully narrow the joint employment standard under the Fair Labor Standards Act (FLSA). The FLSA is the federal law establishing a baseline of critical workplace protections, such as minimum wage and overtime, for workers across the country. The joint employment standard determines when more than one employer is responsible under FLSA because both exert sufficient influence over a worker’s employment.

This change would undermine critical workplace protections for the country’s low-and middle-income workers and could lead to increased wage theft and other labor law violations.

Over the past few decades, businesses have increasingly outsourced and subcontracted many of their core responsibilities to intermediary entities, instead of hiring workers directly. Because these entities tend to be less stable, less well-funded, and subject to less scrutiny, they are more likely to violate wage and hour laws.

In the suit, the coalition argues that USDOL’s new rule provides an incentive for businesses to offload employment responsibilities to smaller companies, which, under the new rule, will shield them from federal liability for wage and hour obligations under the FLSA. The attorneys general argue implementing the new rule will result in lower wages and increased wage theft for workers, especially for workers in low-wage jobs. Further, the new rule will make it more difficult to collect unpaid back wages for workers.

“The rule change is unfair to working men and women around the country. It will allow businesses to outsource labor and skirt important worker protections,” said Attorney General Frosh. “The proposed rule is inconsistent with the Fair Labor Standards Act and undermines Maryland law as well.”

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Department of Labor details response to cybersecurity incident (MD)

Posted by National Alliance for Fair Contracting on

From Staff Reports | Jul 8, 2019

BALTIMORE — The Maryland Department of Labor on July 5 began notifying 78,000 customers with details about potential unauthorized activity on two of its database systems.

While some personally identifiable information may have been accessed without authorization, a thorough investigation conducted by the Department has not revealed any misuse of the accessed data.

Earlier this year, at the request of the Maryland Department of Labor, the Maryland Department of Information Technology — the agency overseeing all state information technology functions and policies — initiated an investigation and determined that files stored on the Literacy Works Information System and a legacy unemployment insurance service database were subject to possible unauthorized access through the internet.

Upon notification of the possibility of unauthorized access, Maryland DoIT implemented countermeasures and initiated an investigation. Working with the Department of Labor, Maryland DoIT also notified law enforcement and retained an independent expert to investigate how the information was accessed.

A full review of the department’s protocols and security measures has been completed to prevent future incidents. To date, this investigation has not produced evidence to confirm that any personally identifiable information was downloaded or extracted from Labor servers.

With this investigation now complete, the Department of Labor is contacting the customers who were impacted by the incident and encouraging them to carefully monitor their accounts. Those who have been affected will be offered two years of free credit monitoring through an independent service.

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Public Work Contractors Should Check Their Payroll, Then Check it Twice… (MD)

Posted by National Alliance for Fair Contracting on

JD Supra
April 10, 2019

Maryland “public work” contractors and subcontractors better be checking their payroll, and then checking it twice, because Senate Bill (“SB”) 300 just came to town! Of course, this level of payroll diligence should already be the norm, but effective October 1, 2019, the stakes for certain public work contractors and subcontractors are just a little bit higher for those that fail to pay the appropriate Maryland prevailing wage rates. As a result, the legal process for their underpaid employees could move much faster.

For those less familiar with Maryland public work contracts, pursuant to Section 17-201(j)(1), “‘public work’ means a structure or work, including a bridge, building, ditch, road, alley, waterwork, or sewage disposal plant, that: (i) is constructed for public use or benefit; or (ii) is paid for wholly or partly by public money.” Notably, however, Maryland prevailing wage laws and the new changes for public work contracts do not apply to: (i) projects performed by a public service company under order of the Public Service Commission; (ii) certain elementary or secondary school projects for which less than 25% of the money used for construction is State money; (iii) certain other public work projects for which less than 50% of the money used for construction is State money; (iv) certain contracts where the contractor is already required to pay prevailing wage rates determined by the federal government; or (v) public works contracts valued at less than $500,000.00.

On March 28, 2019, the General Assembly of Maryland enacted certain new provisions in Section 17-224 of the State Finance and Procurement Article. These provisions allow employees of contractors and subcontractors working on eligible “public works” projects in Maryland, to the extent those employees are not paid the prevailing wage rate established by the Commissioner of Labor and Industry (the “Commissioner”), to immediately sue their employers for the difference between the prevailing wage rate and the amount actually received by the employees. Additionally, to the extent the employer is a subcontractor, both the contractor and subcontractor shall be jointly and severally liable for any violation of the subcontractor’s obligations under Section 17-224.

Under the old Section 17-224, employees were first required to file a complaint with the Commissioner to secure an order of restitution. Only after the employer failed to comply with the order could the Commissioner or the employee bring a civil action in circuit court to enforce the order. Further, the allegedly underpaid employee only had recourse against his or her employer, without an express right to recovery against upstream contractors.

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Maryland SB 300 – Prevailing Wage Rates, Public Works Contracts and Suits by Employers (MD)

Posted by National Alliance for Fair Contracting on

March 28, 2019

This bill authorizes an employee under a public work contract who is paid less than the appropriate prevailing wage to sue to recover the difference in wages paid without first filing a complaint with the Commissioner of Labor and Industry. A determination by the commissioner that a contractor is required to make restitution does not preclude the employee from a private cause of action. A contractor and subcontractor are jointly and severally liable for any violation of the subcontractor’s obligations associated with civil actions (brought either by the commissioner or the employee).

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(See PDF of Bill)

Contractors, Your Subcontractors’ Wage And Hour Practices Are Your Business

Posted by National Alliance for Fair Contracting on

J.D. Supra
March 20, 2019

A prime or general contractor may be held jointly and severally liable for any violations, including wage and hour violations, by its subcontractors if the contractor is found to be a joint employer with the subcontractor under applicable federal or state law. As most contractors who work on construction projects covered by the federal Davis-Bacon Act (DBA) (direct contracts) and DBA Related Acts (federal funding or loan guarantees) (together, DBRAs) know, a prime or higher tier contractor is jointly and severally liable for violations by its subcontractors without the requirement of a joint employer finding. Many state prevailing wage laws (which require that wages for construction workers on public works projects be paid according to published wage scales) mirror the DBRAs’ liability law. The consequences for violations of the DBRAs, which are enforced by the U.S. Department of Labor (DOL), include back pay, penalties under the Contract Work Hours Safety Standards Act (CWHSSA) for overtime violations, and debarment from holding or working on any government contracts (after a referral and hearing process) for a period of up to three years.

For these reasons, contractors on DBRAs-covered projects should include terms and language in their subcontracts to help ensure their subcontractors are complying with the DBRAs regarding proper classification of workers, accurate timekeeping, timely payment of the correct prevailing wages and benefits based on job classification and hours worked, proper payment of overtime under CWHSSA, and the submission of accurate certified payroll. While rare, in addition to holding the prime or higher tier contractor responsible for payment of back pay and CWHSSA penalties for subcontractor violations if the subcontractor cannot pay or will not pay, the DOL has debarred prime contractors that have failed to properly monitor their subcontractors with respect to the DBRAs’ requirements.

District of Columbia; Maryland

For construction contractors who work on projects in the District of Columbia (D.C.) or Maryland, there is even more reason to mind the pay practices of subcontractors. In the last few years, both of these jurisdictions have enacted laws that, like the DBA, hold higher tier contractors jointly and severally liable for their subcontractors’ violations of local wage and hour laws.

In D.C., the local wage and hour laws specify that prevailing wages are covered, and can be recovered, in addition to local minimum and overtime wages.

The potential damages that can be recovered are crushing. In D.C., in addition to back pay, a contractor can be liable for an additional three times the back pay in damages (or quadruple recovery) as well as attorneys’ fees and additional penalties. In Maryland, the liability is slightly less, back pay plus two times the back pay in damages (or triple recovery) as well as attorneys’ fees and penalties.

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Maryland just became the sixth state to raise the minimum wage to $15 an hour (MD)

Posted by National Alliance for Fair Contracting on

Democrats in Maryland just overrode the governor’s veto of the $15 minimum wage bill.

By Alexia Fernández Campbell
Mar 28, 2019, 2:20pm EDT

Maryland just became the sixth state to raise the minimum wage to $15 an hour.

On Thursday, lawmakers managed to override Republican Gov. Larry Hogan’s veto of a minimum wage bill. Maryland’s current minimum wage is $10.10, and the new policy willgradually raise the wage floor to $15 by 2025.

Hogan had blocked the bill earlier this week, claiming that such a change would “devastate” the economy. But it was clear early on that he would be unable to stop the national momentum building around a $15 minimum wage.

Democrats control both chambers in Maryland’s General Assembly, and passed the wage hike bill with a veto-proof majority. On Thursday, they overwhelming voted to override Hogan’s veto by 96-43 in the House and 35-12 in the Senate.

Maryland is now the third state to phase in a $15 minimum wage so far this year, and the sixth overall. In February, New Jersey and Illinois did so, too.

While Hogan’s veto was not surprising (he has always opposed a $15 minimum), it’s a striking position in a state where the $15 minimum wage is so popular with voters in Maryland and across the country.

The law will benefit about 573,000 workers in Maryland who currently earn less than $15 -about 22 percent of the state’s workforce, according to the National Employment Law Project.

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New Maryland Law Exposes General Contractors and Subcontractors to Greater Wage and Hour Liability (MD)

Posted by National Alliance for Fair Contracting on

September 19, 2018
J.D.Supra

Effective October 1, 2018, general contractors with projects in Maryland will have a new headache to deal with. That’s when Maryland’s new law, the General Contractor Liability for Unpaid Wages Act, will go into effect. Under the Act, GCs will be jointly and severally liable for the failure of any subcontractors on the GC’s project to comply with Maryland’s existing wage and hour law. GCs will have to ensure that all of their subcontractors (including any sub-subcontractors or other firms they hire) pay their employees in accordance with Maryland law.

Under the new Act, an employee can sue both its employer and the GC on the job for up to three times the wages owed to the employee, plus attorneys’ fees and costs. This applies to any job involving “construction services”, which is broadly defined to include any work involving “building, reconstructing, improving, enlarging, painting, altering, and repairing” of property.

Subcontractors will not be spared the effects of this new law. They are required to indemnify a GC for “any wages, damages, interest, penalties, or attorneys’ fees owed as a result of the subcontractor’s violation.” That means the failure to comply with Maryland’s wage and hour laws can expose a subcontractor to significantly greater liability than before.

GCs should prepare for the new reality by reviewing their subcontractor agreements to ensure they are protected. They also will want to implement protocols for reviewing the pay records of subcontractors and any sub-subcontractors or suppliers they hire.
In addition to the above compliance controls, subcontractors should be on the lookout for new indemnification language in subcontracts and the partial releases that most GCs require in exchange for periodic payment on construction projects.

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New Maryland Law Makes General Contractors Liable for Paying Their Subcontractors’ Employees (MD)

Posted by National Alliance for Fair Contracting on

May 25, 2018
JD Supra

At the tail-end of the 2018 legislative session, the Maryland General Assembly passed Senate Bill 853, making construction general contractors jointly and severally liable for the failure of their subcontractors to pay their employees in compliance with Maryland’s wage and hour laws. This new law will become effective October 1, 2018. California recently passed a similar measure, AB 1701, which is applicable to construction contracts entered into in that state on or after January 1, 2018.

This controversial new Maryland law contains both a multiplier and an attorneys’ fees provision, dramatically increasing its impact. Under existing law, an employer that fails to pay an employee in accordance with Maryland’s wage and hour laws may be liable to the employee for up to three times the wages owed, plus reasonable attorneys’ fees and other costs. Until now, this liability has largely been confined to the direct employer-employee relationship. SB 853 expands the reach of Maryland’s wage and hour law, making a general contractor on a construction services project jointly and severally liable for a subcontractor’s failure to properly pay its employees. The term “construction services” is broadly defined to include “building, reconstructing, improving, enlarging, painting, altering, and repairing” in connection with real property. Notably, the liability imposed by this new law is not limited to first-tier subcontractors; rather, it expressly applies “regardless of whether the subcontractor is in a direct contractual relationship with the general contractor.” So, a general contractor is now liable for every wage and hour law violation occurring on a construction project, including those committed by subcontractors far down the construction chain. The time frame for this liability is also expansive. A claimant may make a claim against both the general contractor and the non-paying party as soon as two weeks after a violation occurs, and as late as three years after the occurrence.

For balance, the new law requires subcontractors to indemnify the general contractor for “any wages, damages, interest, penalties, or attorney’s fees owed as a result of the subcontractor’s violation.” This protection, however, is only as strong as the subcontractor’s ability to pay such damages and costs. SB 853 increases the likelihood that employees will sue both the general contractor and their direct employer when they believe they have not been properly paid. Because general contractors are now a target for additional litigation, the potential costs subject to indemnification by subcontractors will be increased by the general contractor’s costs of defense. Additionally, because the general contractor will not always be the direct employer of the plaintiff bringing such a claim, it may not have in its possession the employee-related documents necessary to defend a claim, including a potentially fraudulent claim. Notably, the law outlines two express exceptions to indemnification: (1) when indemnification is provided for in a contract between the general contractor and the subcontractor; or (2) when a violation arose due to the general contractor’s failure to make timely payments to the subcontractor.

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