PRINTER'S NO. 237
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No.
274
Session of
2023
INTRODUCED BY R. MACKENZIE, GLEIM, JOZWIAK, KAUFFMAN,
M. MACKENZIE, MARSHALL AND STRUZZI, MARCH 10, 2023
REFERRED TO COMMITTEE ON LABOR AND INDUSTRY, MARCH 10, 2023
AN ACT
Amending the act of April 9, 1929 (P.L.177, No.175), entitled
"An act providing for and reorganizing the conduct of the
executive and administrative work of the Commonwealth by the
Executive Department thereof and the administrative
departments, boards, commissions, and officers thereof,
including the boards of trustees of State Normal Schools, or
Teachers Colleges; abolishing, creating, reorganizing or
authorizing the reorganization of certain administrative
departments, boards, and commissions; defining the powers and
duties of the Governor and other executive and administrative
officers, and of the several administrative departments,
boards, commissions, and officers; fixing the salaries of the
Governor, Lieutenant Governor, and certain other executive
and administrative officers; providing for the appointment of
certain administrative officers, and of all deputies and
other assistants and employes in certain departments, boards,
and commissions; providing for judicial administration; and
prescribing the manner in which the number and compensation
of the deputies and all other assistants and employes of
certain departments, boards and commissions shall be
determined," in public works employment verification, further
providing for definitions, for duty of public works
contractors and subcontractors, for verification form, for
violations, for enforcement and sanctions, for Public Works
Employment Verification Account, for protection from
retaliation, for good faith immunity and for public works
contractor and subcontractor liability; and making an
editorial change.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. Article XXIV-C heading and sections 2401-C, 2402-
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C, 2403-C, 2404-C, 2405-C, 2406-C heading and (a), 2407-C(a),
2408-C and 2409-C of the act of April 9, 1929 (P.L.177, No.175),
known as The Administrative Code of 1929, added November 3, 2022
(P.L.2048, No.141), are amended to read:
ARTICLE XXIV-C
PUBLIC [WORKS] CONTRACTOR EMPLOYMENT VERIFICATION
Section 2401-C. Definitions.
The following words and phrases when used in this article
shall have the meanings given to them in this section unless the
context clearly indicates otherwise:
"Contract." A type of written agreement, between a public
body and a public contractor, regardless of what the agreement
may be called, for the procurement or disposal of supplies,
services or construction and executed by all parties in
accordance with all applicable State law.
"Department." The Department of General Services of the
Commonwealth.
"Employee." An individual hired by a public [works]
contractor or subcontractor for whom the public [works]
contractor or subcontractor is required by law to file a Form W-
2 with the Internal Revenue Service.
"EVP." The E-Verify Program operated by the Department of
Homeland Security that electronically verifies employment
eligibility for employees.
"Public body." The Commonwealth of Pennsylvania, any of its
political subdivisions, any authority created by the General
Assembly of the Commonwealth and any instrumentality or agency
of the Commonwealth.
["Public work." As defined under section 2 of the act of
August 15, 1961 (P.L.987, No.442), known as the Pennsylvania
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Prevailing Wage Act.]
"Public [works] contractor." A contractor that provides work
under a contract [involving a public work] with a public body.
"Secretary." The Secretary of General Services of the
Commonwealth.
"Subcontractor." A person, other than a natural person,
regardless of its tier, including, but not limited to, a
staffing agency that performs work for a public [works]
contractor under a contract [for a public work]. The term shall
not include persons that are material suppliers for a
construction project.
"Willful." Action or conduct undertaken intentionally or
with reckless disregard for or deliberate ignorance of the
requirements and obligations established under this article.
Section 2402-C. Duty of public [works] contractors and
subcontractors.
(a) General rule.--[A]
(1) Except as provided in paragraph (2), a public
[works] contractor or subcontractor shall participate in EVP
and shall, subject to the requirements of Federal law
governing the use of EVP, use EVP to verify employment
eligibility of each new employee. The department shall post
on its publicly accessible Internet website information
regarding the requirements of Federal law governing the use
of EVP.
(2) A public contractor or subcontractor without
employees shall not be required to enroll in EVP. The
following shall apply:
(i) For the purposes of section 2403-C, a public
contractor or subcontractor without employees may submit
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an affidavit stating that the individual public
contractor or subcontractor is authorized to work in the
United States and has no employees, in lieu of a
statement that the public contractor or subcontractor is
enrolled in EVP.
(ii) A public contractor or subcontractor without
employees shall enroll in EVP and provide an updated
verification form to the public body prior to hiring any
employees.
(b) Discrimination prohibited.--In conducting the
verification required by this section, a public [works]
contractor or subcontractor shall not discriminate against an
employee on the basis of race, ethnicity, color or national
origin.
Section 2403-C. Verification form.
(a) General rule for public [works] contractors.--As a
precondition of being awarded a contract [for a public work], or
with respect to a contract that was awarded prior to the
effective date of this subsection but has not yet been executed,
prior to the execution of the contract, a public [works]
contractor shall provide the public body with a verification
form described in subsection (c), acknowledging its
responsibilities under and its compliance with section 2402-C
and stating that the contractor is enrolled in EVP. Contracts
between a public [works] contractor and its subcontractors shall
contain information about the requirements of this article.
(b) General rule for subcontractors.--Prior to commencing
work [on a public works project] under a contract, a
subcontractor shall provide the public body with a verification
form described in subsection (c) acknowledging its
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responsibilities and its compliance with section 2402-C and
stating that the subcontractor is enrolled in EVP. Contracts
between a subcontractor and its subcontractors shall contain
information about the requirements of this article.
(c) Form.--The verification form required by this section
shall be on a form prescribed by the secretary and posted on the
department's publicly accessible Internet website and shall
comply with the following additional requirements:
(1) The statement shall include a certification that the
information in the statement is true and correct and that the
individual signing the statement understands that the
submission of false or misleading information in connection
with the verification shall subject the individual and the
public [works] contractor or subcontractor, as the case may
be, to sanctions provided by law.
(2) The statement shall be signed by a representative of
the public [works] contractor or subcontractor, as
applicable, who has sufficient knowledge and authority to
make the representations and certifications contained in the
statement.
Section 2404-C. Violations.
It is a violation of this article for a public [works]
contractor or subcontractor [on a public work] under a contract
to:
(1) Fail to verify the employment eligibility of a new
employee through EVP in accordance with Federal law.
(2) Not provide the verification form as required under
section 2403-C or make a false statement or misrepresentation
with respect to completing the form.
Section 2405-C. Enforcement and sanctions.
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(a) General rule.--The department shall enforce this
article.
(b) Investigation of complaints.--The department shall
accept, review and investigate in a timely manner any credible
complaint that a public [works] contractor or subcontractor has
violated a provision of this article.
(c) Audits.--To ensure compliance with the requirements of
this article, the department shall conduct complaint-based and
random audits of public [works] contractors and subcontractors
in this Commonwealth.
(d) Reimbursement of department.--
(1) The department may require a public [works]
contractor or subcontractor to reimburse the department for
the cost of an audit if the public [works] contractor or
subcontractor:
(i) is debarred from [public] work under a contract
under subsection (e); or
(ii) is subject to a civil penalty under subsection
(f).
(2) The cost of an audit shall be reasonably based on
the amount of staff time spent on conducting an individual
audit.
(e) Sanctions.--The following sanctions shall apply only to
a violation under section 2404-C(1):
(1) For a first violation, a public [works] contractor
or subcontractor shall receive a warning letter from the
department detailing the violation. The letter shall be
posted on the department's publicly accessible Internet
website.
(2) For a second violation, a public [works] contractor
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or subcontractor shall be debarred from [public] work under a
contract for 60 days.
(3) For a third violation and subsequent violations, a
public [works] contractor or subcontractor shall be debarred
from [public] work under a contract for not less than one
year and not more than two years.
(4) In the case of an alleged willful violation, the
secretary shall file a petition in Commonwealth Court seeking
to have the court issue a rule to show cause why a public
[works] contractor or subcontractor did not engage in the
willful violation. If the court finds that the public [works]
contractor or subcontractor engaged in a willful violation,
the court shall order that the public [works] contractor or
subcontractor be debarred from [public] work under a contract
for a period of three years.
(5) Notwithstanding the provisions of paragraph (1), (2)
or (3), a violation by a public [works] contractor or
subcontractor that occurs 10 or more years after a prior
violation shall be deemed to be a first violation.
(6) For the purposes of assessing sanctions, violations
committed by a contractor or subcontractor subject to this
article involving a single [public works] contract shall be
considered a single violation despite the number of employees
that are the subject of the violations.
(f) Civil penalty and sanctions.--The following shall apply:
(1) A public [works] contractor or subcontractor that
violates section 2404-C(2) shall be subject to a civil
penalty of not less than $2,500 and not more than $25,000 for
each violation, to be imposed by the department based on the
duration and severity of the violation.
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(2) In addition to the penalty under paragraph (1), in
the event of a willful violation of section 2404-C(2), a
public [works] contractor or subcontractor shall be subject
to debarment for not less than 60 days nor more than three
years, depending on the duration and severity of the
violation.
(g) Notice and appeal.--Actions taken by the department
under subsections (e)(1), (2) and (3) and (f) shall be subject
to the notice, appeal and other provisions of 2 Pa.C.S.
(relating to administrative law and procedure).
Section 2406-C. Public [Works] Contractor Employment
Verification Account.
(a) Establishment.--The Public [Works] Contractor Employment
Verification Account is established as a restricted revenue,
interest-bearing account in the General Fund.
* * *
Section 2407-C. Protection from retaliation.
(a) General rule.--It shall be unlawful for a public [works]
contractor or subcontractor to discharge, threaten or otherwise
retaliate or discriminate against an employee regarding
compensation or other terms or conditions of employment because
the employee:
(1) participates in an investigation, hearing or inquiry
held by the secretary or any other governmental authority
under this article; or
(2) reports or makes a complaint regarding the violation
of this article to a public [works] contractor or
subcontractor or to any governmental authority.
* * *
Section 2408-C. Good faith immunity.
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A public [works] contractor or subcontractor that relies in
good faith on EVP procedures to verify employment eligibility of
new employees under this article shall be immune from the
sanctions authorized under section 2405-C and shall have no
liability to an individual who is not hired or who is discharged
from employment in the event that incorrect information has been
provided to the public [works] contractor or subcontractor. A
public [works] contractor or subcontractor that can produce
written acknowledgment provided by an applicable Federal agency
of use of EVP is considered to have acted in good faith.
Section 2409-C. Public [works] contractor and subcontractor
liability.
Nothing in this article may be construed to render a public
[works] contractor liable for the action of a subcontractor or a
subcontractor liable for an action of another subcontractor.
Section 2. This act shall take effect in 60 days.
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