Rhode Island Legislative Update: Final Report 2023

The following report is from RILBMDA Lobbyist, Terry Martiesian of Martiesian & Associates.

Did You Know?

The lumber and building materials industry employs more than 7,000 people in R.I.

Lobby Day

RILBMDA is hosting its lobby day on May 17. We will share more details as we get closer.

The 2023 Rhode Island General Assembly Session concluded on June 15, 2023.  However, transmitting bills to the Governor for his consideration continued until the month’s end.  Our legislative process permits the Governor to sign a bill into law, veto the legislation or do nothing such that the bill automatically becomes law without his signature.  Your Association covered numerous pieces of legislation (H-104 plus budget and S-71).  Overall, the House and Senate collectively introduced 2670 bills (House – 1535 and Senate – 1135).

Overall, the session could have been much worse due to the volume of anti-business bills introduced.  Unfortunately, many legislators have no understanding nor do they care to understand business which in our state is truly small business.  There is a mindset that business is solely responsive for our many issues and can pay for everything.  Sadly to say this attitude is getting worse. One clear example is a bill that would have required businesses to pay employees 40 hours per week but your employees would only be required to work 32 hours.  Hard to believe! Most of the onerous bills that passed were amended and in many cases substantially in business’s favor before passage. 

Your Association, with the active support of its membership, played a vital role in assisting in the amendment or defeat of a number of bills.

One of the key pro-business budget issues strongly supported by your Association and the Business Coalition was signed into law.  It created a statewide $50,000 exemption for the tax on tangible personal property (TPP) thereby eliminating approximately 75% of our state’s businesses from the tax rolls.  There’s more to do as a number of the states are moving completely away from this tax.

Identity Theft Protection (ITP) Act H-5684 Sub A provides IT protection by requiring the reporting of data breaches by certain municipal and state agencies and requires notice and to affected employees/customers within 30 days of a data breach discovery and also requires an explanation and payment of remediation services.  The original bill would have also applied the new requirements to all businesses.  Business again was successful in getting the bill redrafted such that the stricter new provisions will only apply to “state and municipal agencies”.  For example, business remains under the same rules of notification within 45 days of the discovery of the data breach and includes information for customers to protect themselves. This all came about because of the RIPTA breach that was not reported for months. 

Probably, the session’s most controversial anti-business bill was the Wage Theft/Independent Contractor bill (S-1079 Sub Aaa and H-5902 Sub Aaa).  This legislation created felony penalties if an employer knowingly and willfully fails to pay employees on the regular payday and the amount owed must be in excess of $1500; fails to pay any employee wages owed on time of his/her employment termination $1500 plus owed or fails to pay wages in excess of $1500 to the representative of any deceased within 30 days of death.

The General Assembly did not adopt the 3 step test that labor lobbied for but did adopt the Fair Labor Standards Act (FLSA) definition of an independent contractor to be used for all complaints of misclassification and requires the Department of Labor and Training (DLT) to investigate all complaints with the association of the Underground Economy Task Force.  Their findings would be eventually forwarded to the Attorney General who, by the way, was a strong supporter as was labor of the bill’s original draft.

Gift Card Sales (H-5721 Sub A and S-759 Sub Aaa) mandates that businesses that sell gift cards for their own store or affiliated businesses display a caution notice at the locations where the cards are sold of potential prepaid card scams.  The state-approved sign, in both English and Spanish, can be found here. Failure to display the notice can result in a penalty of up to $250 per violation. The law is in effect now.

June 19 became the newest state holiday with the passage of both H-5380 Sub A and S-444 Sub A.  It is the named ‘Juneteenth National Freedom Day’ and non-exempt employees are eligible for holiday pay if they work that day.

Independent Contractor Registration (H-5710 Sub A and S-427 Sub B) requires independent contractors to file annually and electronically with the DLT i.e. a filing for each client.  The DLT shall submit the list to the Division of Taxation each April 1.  The law becomes effective on January 1, 2024.

Electric Vehicle Parking Lot (S-988 aa) passed and requires large employers (100  employees in a single location) to install equipment to support Level 2 or DC fast charges in new parking lots or expansion of an existing lot.  Also applies to big box stores, malls, etc.  This bill was amended to apply only to new projects subsequent to January 1, 2024, that receive any form of public funding.

A number of new health insurance mandates were enacted.  Individually, a mandate does not normally have a great impact on healthcare insurance premiums but each year the list of mandates required to be covered grows such that they are now a significant portion of the premiums you pay. 

FYI, our state is one of the leaders for mandated coverage in the country.  Passage this session included:

  • Epinephrine injectors
  • HIV treatment
  • Screening for dense breast tissue
  • Coverage for specialty drugs (drugs for rare conditions and normally expensive).

Not all was doom and gloom as the following bills did not make the cut:

  • Workplace Psychological Safety Act (S-821 Sub A).  This bill proposed to create rules and procedures for employers to follow and penalties if not done to address certain behaviors in the workplace and get this included spreading of lies, abusive gestures, physical isolation, regular inconsistent instructions, unmanageable workloads, persistent criticism, and so on.  This bill qualified as a candidate for the worse bill introduced.
  • Parental and Family Medical Leave Expansion S-145 passed the Senate and died in the House as did House Bill 5990.  The bill proposed to increase leave available to an employee from 13 to 24 weeks in any two-year cycle.
  • Legislation to eliminate the use of non-compete agreements (S888) except when used during the purchase and sale of a business

Lastly, 2023 was quite a General Assembly Session and this has carried over with two special elections. One being for Representative District One which became vacant with the resignation of US Representative David Cicilline. There are numerous candidates to choose from. The other is Rhode Island Senatorial District 1 which sadly became vacant with the death of Senate Majority Whip Mary Ellen Goodwin; a truly wonderful individual and public servant.

Did You Know?

The lumber and building materials industry employs more than 7,000 people in R.I.

Lobby Day

RILBMDA is hosting its lobby day on May 17. We will share more details as we get closer.