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​​Chamber Connections BLOG

Paid Sick Leave Alert

6/19/2018

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As you may be aware, the RI Department of Labor sent a letter to businesses stating that the Department would not enforce the Paid Sick and Safety Leave Act (PSSLA) until January 1, 2019.  While perhaps well meaning, this letter has only set a trap for Rhode Island businesses.  The PSSLA provides employees with the right to seek relief through the assistance of DLT, but it also gives employees a private right of action.  DLT has no authority over the court system; and the Court will have no choice but to enforce the law.  The only way to delay the effective date of the law is through legislative intervention.  The Chamber sent a letter to the leadership of the House and the Senate asking them to remedy this situation.
 
If the legislature does not act, the PSSLA goes into full effect July 1, 2018.  If the legislature delays the PSSLA in its entirety, then businesses will have until January 1, 2019 to change policy manuals, begin the accrual of time off for employees and provide the leave.  Lastly, if the legislature chooses to only delay the penalties in the Act until January 1, 2019, then businesses must change their policies, begin accrual, and provide employees with the time off – but if you make a mistake, the penalties provided in the law by the courts and DLT will not be assessed as long as the business corrects the situation before January 1, 2019.
 
 
An Update from the State House
 
The House passed the $9.55 billion budget 66-7 at 9:52 p.m. last Friday night.  Had the debate continued much longer, the House was prepared to return to finishing the debate Saturday afternoon.  Fortunately, that was not necessary.  Most changes to the budget were technical in nature, although the sports betting agreement was reached.  The State will get 51% of the revenue, IGT – the operator of the betting will get 32%, and Twin River will get 17%.  In addition, the communities of Lincoln and Tiverton will receive and annual payment of $100,000 for hosting the facilities.  Some in the media drew attention to the fact that the amended Article passed with no debate on the floor, but most legislators had agreed on the amount that would be raised from the activity prior to the final vote leaving debate unnecessary.  
 
 
This Week At the State House
 
We are coming into what should be the last week of the 2018 legislative session.  Many issues remain in play:  Pay Equity, the Pawsox Stadium, Internet Privacy Disclosures, Sexual Harassment Training in the Workplace, Non-Disclosure Agreements in Employer/Employee Settlement Agreements, Anti-bullying Procedures in the Workplace, Health Insurance Surprise Billing, Harassment Reports for Companies with 100+ Employees…the list is substantial. 
 
The House Speaker said he hopes to reach consensus on Pawsox legislation by Tuesday.  H.7290 (Reps. Messier, Coughlin, Johnston, Tobon and Barros) is scheduled for a hearing and possible consideration in the House Finance Committee at 3:30pm in Room 35 of the State House.
 
H.7111 SubA (Reps. Shanley, Carson, Regunberg, Marszalkowski and Edwards) remains very much in play.  This bill is referred to by proponents as the Data Transparency bill. The Chamber sent out an action alert last week asking for your help.  The Senate version is S.2277 (Sens. Pearson, Euer, Goldin, Satchell, Seveney).  Various business groups met with the House sponsor Monday.  The fate of the bill is unclear at this time.  While the bill is very difficult for telecom companies to administer, it also has ramifications for the general business population as well. 
 
1.  If a company has 10 employees or more and is completely self-contained in its internet customer information collection activity, then the company has no new requirements under this bill.  “Self-contained” means the company creates its own website, gathers the data itself, shares it with no one – not even a website operator or payment company.
 
2.  If a company has 10+ employees and uses a third-party to create and operate its website or to take orders, fill orders or uses a payment system that interacts with the website information, then the company must execute a confidentiality agreement with the third party and take steps to “effectively enforce” the agreement.  If that happens, the company has no new requirements under the law.
 
3.  If a company has 10+ employees and fails to meet the criteria of #2 above, or if the company shares information with a third party for the third party’s use, then the company must change its website by July 1, 2018, to state what categories of information are collected, disclose the third parties that receive the information and how it is used, and provide information on how a consumer can request specific knowledge about the information on file with the company.  If a customer requests information, the company has 30 days to provide a list of the information that has been collected over the past 12 months concerning that specific customer.  This means that the data collected must be collected in a way where it is tied to the name of the customer – something cyber security experts advise against to deter hackers from obtaining identity theft information.
 
This bill is not law in any other state in the country.  Illinois passed it, but it was vetoed by the Governor of Illinois. 
 
 
The following bills were filed last week:
 
House Bill No. 8320
BY  Amore
ENTITLED, AN ACT RELATING TO SPORTS, RACING, AND ATHLETICS - SPORTS BETTING (Establishes 9 sports betting parlor licenses for on-site/on-line wagering with DBR granted licensing/regulatory power relating to license issuance to applicants/employees/third-party vendors/collection of fees/taxes with local licensing. eff. 11/6/18)

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House Finance Committee passed its version of the FY2019 budget

6/12/2018

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​Last Friday night, shortly before midnight, the House Finance Committee passed its version of the FY2019 budget.  The budget is considered a work in progress as a few Articles passed with the acknowledgement that an updated version will be hammered out prior to the budget vote by House floor on Friday.  The House is scheduled to go into session Friday, June 15th at 2:00 p.m. to debate and vote on the budget.  The following is a description of a number of items found in the Finance Committee passed budget:
 
Fees assessed on the offering of federal covered securities in Rhode Island could be increased under the Finance Committee budget.  The Governor had proposed increasing the maximum charge for the initial offering from $1000 to $1500.  The Finance Committee budget raises the maximum to $1750.  The Governor also proposed increasing the fee charged to open end management companies that file a “notice for an indefinite amount of securities” (and for a subsequent renewal) from $1000 to $1500.  The Finance Committee budget increased the fee to $1750.
 
The Finance Committee chose to keep the Governor’s proposed $100 fee increase on insurance claim adjusters (new fee will be $250)
 
Food service establishments will no longer have to obtain a frozen dessert license in addition to the license required to operate as a food service establishment.  An entity that is not a food service establishment but has frozen dessert machines will have to obtain the license.  Additionally, food safety certifications will last 5 years instead of 3 years. 
 
The E 911 fund was renamed the “Geographic Information System (GIS) and Technology Fund to describe more transparently the purpose of the fund.  The fee associated with the fee did not change.
 
The Finance Committee eliminated the 25 cent increase in the cigarette tax (the current tax is $4.25 per pack) as well as the tax on vapor products, cigars and smokeless tobacco. 
 
The Governor’s Real Jobs program did get funded, but the amount of interest to be taken from the Unemployment Insurance (UI) Fund will be less.  The Governor included a diversion 100% of the UI interest earned on the fund to the Real Jobs program.  The House did not favor the taking of the funds leaving this issue as one of the last issues to reach resolution during the budget negotiations.  The Finance Committee lowered the diversion to 75% ($5.5 million) in efforts to ensure that the UI Fund continues to grow.  The Committee stated that this is a one-time authorization of the diversion of the interest. 
 
The Budget proposal sunsets the Jobs Training Tax Credits Act January 1, 2018.
 
The Rhode Island State Work Immersion Program – a “temporary, paid, work experience that provides a meaningful learning opportunity and increases the employability of the participant” - has been expanded to allow any Rhode Island resident to participate.  Under current law, only post-secondary school students, recent college graduates and unemployed adults could participate in the program.  Employers currently are eligible to receive a credit for up to 50% of the wages paid to a person for up to 400 hours of work during a 10 week period.  The Finance Committee budget increases the credit to 75% of the wages paid during the participant’s work experience.
 
Finally, the Finance Committee budget places a June 30th, 2020 sunset on a number of economic development programs:  Rebuild RI Tax Credit; RI Tax Increment Financing; Tax Stabilization Incentive; First Wave Closing Fund; I-195 Redevelopment Project Fund; Small Business Assistance Program; Stay Invested in RI Wavemaker Fellowship; Main Street RI Streetscape Improvement Fund; Innovation Initiative; Industry Cluster Grants; High School, College, and Employer Partnerships; and the RI New Qualified Jobs Incentive Act of 2015.
 
This Week At the State House
 
Many committees are meeting to consider bills such as immunity to entities or persons that donate food to a food bank, and the adoption of the federal electrical code.
 
One bill of note will be considered by the Senate Labor Committee on Wednesday.  S.2471 (Senators Ciccone, Calkin, Goldin, Euer and Nesselbush) establishes a cause of action against employers and employees for workplace bullying, harassment and other abusive conduct.  "Abusive conduct” is defined as “acts, omissions, or both, that a reasonable person would find abusive based on the severity, nature, and frequency of the conduct.”  An employer is vicariously liable for the actions of its employees, unless the employer can show it exercised reasonable care to prevent and promptly correct any actionable behaviors AND the employee failed to take appropriate preventative or corrective opportunities provided by the employer. 
 
 
The following bills were filed last week:
 
House Bill No. 8288
BY  Regunberg, Tanzi, Vella-Wilkinson, Casimiro, Donovan
ENTITLED, AN ACT RELATING TO TAXATION - APPLICATION FOR TAX CREDITS, STATE FUNDS OR STATE CONTRACTS (Mandates applicants for state contracts in excess of $50K disclose discrimination complaints for prior 5 years.)
 
House Bill No. 8303
BY  Marszalkowski, Carson, Donovan, Casimiro, Handy
ENTITLED, AN ACT RELATING TO FOOD AND DRUGS - FOOD DONATIONS (Provides immunity to persons donating food to food banks.)
 
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Second Alert --  June 14 Deadline Approaching!!!

6/5/2018

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This year’s elections are extremely important to the business community.  In many cases, the only contested races will take place in the Primary election September 12, 2018.  In order to vote in a party’s primary election, you must either be a member of that party or unaffiliated (independent) and be registered to vote in the district where you live.  
 
If you would like to have more choices on who to vote for in the Primary Election, it is recommended that you register as “unaffiliated” so that you can choose which primary to vote in depending who is running in the Primary.  The deadline for disaffiliating is June 14, 2018. 
 
To register to vote, check your affiliation, or to change to “unaffiliated,” go to https://vote.sos.ri.gov/  and have your driver’s license in hand.
 
Also, as stated previously in UTD, anyone wishing to run for office must file a Declaration of Candidacy Form with the Local Board of Canvassers in the City or Town in which you reside.  Forms can be filed June 24th, 25th or 26th.   Last week, Senator Daniel DaPonte (East Providence) announced he will not seek re-election. 
 
 
An Update from the State House
 
 
Last Week At the State House
 
The Senate Committee on Environment and Energy discussed S.2747 (Senators Euer, Coyne, Miller, Sosnowski and Calkin).  S.2747 creates the Rhode Island Global Warming Solutions Act, which establishes legally enforceable emission reductions in the state.   To accomplish these goals, the bill requires the Office of Energy Resources, the Department of Transportation and the State Building Commission to promulgate rules necessary to achieve the emission reduction goals or face a lawsuit in Superior Court.  The bill mandates a 5% requirement for electric vehicles sales by 2025, 40% electric vehicles by 2035, and 95% by 2050.  It also mandates that all existing buildings – commercial and residential would have to be heated solely by electricity by 2050.  Ten percent of buildings heated by oil or propane would have to be switched to electric heat by 2025.  No new building with a shovel in the ground on or after January 1, 2035 could be heated with oil or propane.  By 2050, all RI buildings must be converted to electric heat. 
 
The Conservation Law Foundation testified that S.2747 was modeled after a Massachusetts bill and that the economy of MA has not suffered from its passage.  However, the MA bill does not include the electric car or the electric heat mandate; and the MA bill does not reach its first emissions reduction requirement until 2020, so no economic activity can be related to the passage of the MA Act – good or bad. 
This Week At the State House
 
The Special Legislative Commission to Study Unlawful Sexual Harassment in the Workplace finished its work last week by filing seven bills aimed at curtailing harassment (two additional bills may be filed later this week).
 
H.8275 (Reps. Vella-Wilkinson, Giarrusso, Serpa, McEntee and Lombardi) requires DCYF and the department of education to identify or develop a program of age appropriate sexual abuse and sexual awareness education to be used in schools.
 
H.8276 (Reps. Tanzi, Ruggiero, Diaz, Hearn and Amore) extends the timeframe for an individual to bring an allegation of an unfair employment practice to the RI Commission Against Discrimination.  The proposed Statute of Limitations would change from one year to two years after an incident has occurred.
 
H.8277 (Reps Tanzi, Ajello, Walsh, Casimiro and Donovan) requires employers with 50 employees or more to conduct mandatory anti sexual harassment training within three months of a new employee’s hiring, or within three months of an employee’s promotion to a managerial position. All employees must go through a refresher training course every two years.  The Department of Administration is required to provide training materials – free of charge – to any business that requests such information.  Any business that receives $50,000 or more in state funds or contracts from the state must provide proof that the required training has been completed.  Finally, H.8277 encourages companies to complete an annual “climate” survey including sexual harassment issues and equal opportunity questions.
 
H.8278 (Reps. Tanzi, Kazarian, Ruggiero, Walsh and Regunberg) forbids an employer to require an employee to execute a nondisclosure agreement or a non-disparagement agreement regarding alleged violations of civil rights or criminal conduct.  These agreements go beyond sexual harassment and could include a wide variety of issues.  Employers could no longer include such confidentiality agreements in any settlements.
 
H.8279 (Reps. Tanzi, Ajello, Walsh, Casimiro and Messier) expands the definition of employee under the Fair Employment Practices Act: “includes any individual under the direction and control of an employer under any appointment or contract of hire or apprenticeship, express or implied, oral or written.”  It specifically eliminates the exemption for individuals in domestic service – housekeepers, nannies, etc; and includes volunteers and unpaid interns.  The Fair Employment Practices Act covers much more than sexual harassment issues. The Act addresses age discrimination and accommodations for disabled employees among other categories.
 
H.8280 (Reps. McEntee, Tanzi, Craven, Knight and Vella-Wilkinson) suspends the statute of limitations for alleged violations of discrimination, sexual harassment or civil rights brought to the RI Human Rights Commission and resets the clock to one year once the claim is filed. 
 
H.8281 (Reps. Shanley, Tanzi, McEntee, Regunberg and Vella-Wilkinson) creates a reporting requirement for state agencies and departments for violations of the fair employment practices chapter and the Equal Opportunity and Affirmative chapter. Any employer found to have committed an unfair employment practice (refusal to hire based on race, color, gender, sexual orientation, etc. or doesn't accommodate a disability) would be listed in an annual report to the Governor, the Speaker of the House, and the Senate President.  It is likely that report would be considered a public document.  The report would also include a list of agencies that have been accused - not found in violation - of failing to meet their affirmative action plan.
 
 
Budget Watch
 
The House and Senate, along with the Governor are actively meeting to work out a spending plan for FY2019.  While there is a small chance the House Finance Committee will vote out a budget this week, next week seems more likely.  Once voted out of Committee, the budget must sit on the House floor for seven days before the full House can vote on the document.
 
Sugary Drinks
 
The Senate Finance Committee will hear testimony Thursday at the Rise on S.2196 (Senators Nesselbush, Crowley, Paolino, Jabour and Miller) which proposes a tax on sugary beverages.  The tax would be paid by wholesalers; however, if the wholesaler fails to pay the tax, the retailer would become responsible for payment.  Tier 1: Beverages with less than five grams (5g) of sugar per twelve fluid ounces (12 fl. oz.) will not be taxed.  Tier 2: Beverages with more than five grams (5g) but less than twenty grams (20g) of sugar per twelve fluid ounces (12 fl. oz.) will be taxed at a rate of one cent ($0.01) per ounce.  Tier 3: Beverages with twenty grams (20g) of sugar or more per twelve fluid ounces (12 fl. oz.) will be taxed at a rate of two cents ($0.02) per ounce.  Syrups and powders which, together with fluids, create a sugary beverage will be taxed as well.
 
 
The following bills were filed last week:
 
House Bill No. 8253
BY  Williams, Diaz, Slater, Maldonado, Tobon
ENTITLED, AN ACT RELATING TO PUBLIC PROPERTY AND WORKS - MINORITY BUSINESS ENTERPRISE (Provides that any minority business enterprise that is certified under the Federal Small Business Act shall be deemed certified by the department of administration as a minority business enterprise.)
 
House Bill No. 8254
BY  McKiernan, Almeida, Perez, Winfield, Fogarty
ENTITLED, AN ACT RELATING TO INSURANCE -- ACCIDENT AND SICKNESS INSURANCE POLICIES--STEP THERAPY PROTOCOL (Requires health insurers, nonprofit hospital service corporations, nonprofit medical service corporations and health maintenance organizations that issue policies that provide coverage for prescription drugs and use step therapy protocols.)
 
House Bill No. 8258
BY  Lancia
ENTITLED, AN ACT RELATING TO TAXATION - BUSINESS CORPORATION AND PERSONAL INCOME TAX (Limit to 7 yrs the period within which bus. corp tax/personal income tax may be assessed for taxpayers failing to file returns on date return was due to be filed/10 yrs within which collection actions can begin from date balance assessed with 4 exceptions)
 
House Bill No. 8264
BY  Shanley, Tanzi, McEntee, Vella-Wilkinson, Giarrusso
ENTITLED, AN ACT RELATING TO LABOR AND LABOR RELATIONS - FAIR EMPLOYMENT PRACTICES (Enhances reporting for state agencies required for violations of the fair employment practices chapter and the equal opportunity and affirmative action chapter.)
 
Senate Bill No. 2934
BY  Miller
ENTITLED, AN ACT RELATING TO STATE AFFAIRS AND GOVERNMENT -- HEALTH CARE--HEALTH INSURANCE (Establishes the Rhode Island reinsurance program and restricted receipt account, from federal funding, administered by the director of the Rhode Island health benefits exchange, to mitigate the impact of high-risk individuals on health insurance rates.)
 
Senate Bill No. 2941
(Lieutenant Governor)
BY  Conley, Nesselbush, Crowley
ENTITLED, AN ACT RELATING TO PUBLIC UTILITIES AND CARRIERS (Reserves 5% of energy efficiency funds for low-income residents for assistance to residents who seek financial assistance with electric bills but do not meet eligibility guidelines for other financial assistance programs.)
 
Senate Bill No. 2950
BY  Ciccone, Miller, Lombardi, Nesselbush, Fogarty
ENTITLED, AN ACT RELATING TO LABOR AND LABOR RELATIONS -- RHODE ISLAND PARENTAL AND FAMILY MEDICAL LEAVE ACT (Allows employee granted unpaid family/parental leave to substitute any accrued vacation/sick/ other appropriate leave for any part of the unpaid leave.)
 
Senate Bill No. 2953
BY  Conley, Nesselbush, Crowley
ENTITLED, AN ACT RELATING TO HEALTH AND SAFETY -- HOSPITAL CLOSURE TRANSITION ACT (Creates the "Hospital Closure Transition Act which would facilitate the acquisition of a closed hospital's assets by an existing hospital by exempting the acquisition from the hospital conversions and health care facilities licensing acts.)
 
Senate Bill No. 2954
BY  Conley, Nesselbush, Crowley
ENTITLED, AN ACT RELATING TO STATE AFFAIRS AND GOVERNMENT -- HEALTH AND SAFETY--ALTERNATIVE PAYMENT INCENTIVE FOR CERTAIN ELIGIBLE HOSPITALS (Establishes a formula to create a transitional alternative payment method incentive to be used in calculating reimbursement rates that must be paid by health insurance carriers to eligible Rhode Island hospitals.)

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