Despite the MD Chamber’s strong opposition, the General Assembly passed legislation (HB 430) setting minimum wage levels for businesses performing service state contracts of over $100,000. The bill will be signed into law this month and is applicable to contracts awarded after the bill’s October 1, 2007 effective date. Businesses bidding on state service contracts need to be familiar with the provisions of the new law:

• Contractors are exempt from the law if they are providing emergency services, or are a public service company, or nonprofit organization. Employers with 10 or fewer employees on a service contract of less than $500,000 are also exempt from the law.
• Employees are subject to the law if they are 18 or older, work at least 13 consecutive weeks on the contract, and devote at least 50% of their work week to the contract.
• The minimum wage level to be paid is at least $11.30 per hour in the 6 metropolitan counties (Anne Arundel, Baltimore City, Baltimore County, Howard, Montgomery, and Prince George’s) and $8.50 per hour in the balance of the state. These wage rates will be altered annually based on changes in the CPI. In certain cases the wage rates may be decreased to reflect payments for health insurance and deferred compensation.
• The agency head will determine in the invitation to bid if a majority of the value of the contract will be performed in the metropolitan counties or the balance of the state, and assign the appropriate minimum wage rate to be paid under the contract.
• Employers must post prominently at the work site a notice of the wage rate and employee rights under the law. The Commissioner of Labor and Industry will develop copies of the required notice in languages that are commonly used.
• Employers that fail to pay the required wage level may be forced to pay restitution and liquidated damages.
• The Department of Legislative Services will study the fiscal and economic impact of the law on the public and private sectors and report to the General Assembly by January 1, 2009.

See a copy of the bill here. Contact Ron Wineholt for further information at rwineholt@mdchamber.org.

Related:

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• Living Wage Regulations Burdensome