If your business has a contract for services with the State for over $100,000, you’ve got a problem.

Regulations to be published September 14 in the Maryland Register will impose burdensome reporting and compliance standards for businesses awarded state service contracts after October 1, 2007. Maryland Chamber staff obtained an advance copy of the regulations, which show how the State Department of Labor, Licensing and Regulation (DLLR) will administer the new Living Wage law. The hot button issues are:

• Wage Reporting - The regulations will require every employer with a State service contract of over $100,000 to file with the State Commissioner of Labor and Industry within 14 days after the end of each payroll period a complete copy of the employer’s and each subcontractor’s payroll records, including each employee’s name, Social Security number, address, weekly wages and hours, rate of pay, health insurance deduction (if any), deferred compensation deduction (if any), and gross wages.
• Benefits Reporting - If the employer wishes to pay less than the Living Wage rate ($11.30 or $8.50) due to health benefits or deferred compensation payments, they must provide detailed documentation to justify the lower payment level, including showing employee authorization.
• Wage Tiers - If a service is capable of being performed in both Tier 1 ($11.30/hr.) and Tier 2 ($8.50/hr.) regions, the agency head will specify the rate or rates based on where the majority of services are performed.
• Out of State Services - If services are performed outside of Maryland, the agency head will assign a Tier wage rate or rates based on where the recipients of the services are located.

The Maryland Chamber has concerns that the reporting requirements on employers are unduly burdensome and some of the Tier wage rate determinations appear to be in conflict with the letter of the law. DLLR will hold a hearing on the regulations in Baltimore at 10 a.m. on September 27. Please contact Ron Wineholt before September 24 if you wish to join Chamber staff in testimony.

See a copy of the proposed regulations here. You can also view an FAQ on DLLR’s website, here. See the Maryland Chamber home page for a bill summary.

Contact Ron Wineholt for further information.

Related:

• As Living Wage Law Takes Effect, Reporting Requirements Remain a Concern
• Living Wage — What You Need to Know