NY State Senate Bill 2009-S5106

Senate Bill S5106

2009-2010 Legislative Session

Provides that subcontractors on public works projects provide a surety bond for the underpayment of the prevailing wage

download bill text pdf

Archive: Last Bill Status - In Senate Committee Labor Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

Please enter your contact information

First Name

Last Name

Email Address

A valid email address is required.

Home address is used to determine the senate district in which you reside. Your support or opposition to this bill is then shared immediately with the senator who represents you.

Optional services from the NY State Senate:

Create an account. An account allows you to officially support or oppose key legislation, sign petitions with a single click, and follow issues, committees, and bills that matter to you. When you create an account, you agree to this platform's terms of participation.

Include a custom message for your Senator? (Optional)

Enter a message to your senator. Many New Yorkers use this to share the reasoning behind their support or opposition to the bill. Others might share a personal anecdote about how the bill would affect them or people they care about.

Actions

View Actions

	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jan 06, 2010	referred to labor
Apr 27, 2009	referred to labor

2009-S5106 (ACTIVE) - Details

See Assembly Version of this Bill:: A6696
Current Committee:: Senate Labor
Law Section:: Labor Law
Laws Affected:: Amd §§220 & 223, Lab L
Versions Introduced in 2011-2012 Legislative Session:: A7092

2009-S5106 (ACTIVE) - Summary

Provides that subcontractors on public works projects provide a surety bond for the underpayment of the prevailing wage; contractors will only become liable for paying the underpaid prevailing wage when the surety bond is exhausted.

2009-S5106 (ACTIVE) - Sponsor Memo

                                 BILL NUMBER:  S5106

 TITLE OF BILL :  An act to amend the labor law, in relation to the
payment of the prevailing wage by subcontractors on public works
projects

 PURPOSE OR GENERAL IDEA OF BILL :

This bill requires all sub-contractors on a public works project to
deposit a surety bond, in the sum of five percent of each
sub-contractor's payroll for the project, with the appropriate fiscal
officer.  Funds from the surety bond will be used for compensating
employees if there is an underpayment of prevailing wages.

 SUMMARY OF SPECIFIC PROVISIONS :

Section 1 of the bill adds subdivision 10 to Section 220 of the Labor
Law.  The new subdivision requires all sub-contractors on a public
works project to deposit a surety bond, in the sum of five percent of
the sub-contractor's payroll on the project, with the appropriate
fiscal officer. The surety bond will be retained by the fiscal officer
for a period of two years and will be refunded to the sub-contractor,
with interest at a rate of five percent annually, at the end of two
years.  The subdivision also stipulates that the surety bond will be
dispersed only for the purposes of compensating workers who are
underpaid the prevailing wage or for repayment to the sub-contractor

after two years.

Section 2 of the bill amends Section 223 of the Labor Law to stipulate
that general contractors will be liable for the underpayment of
prevailing wages by sub-contractors only after the proceeds from the
surety bond have been exhausted.

 JUSTIFICATION :

Section 223 of the Labor Law presently states that if a sub-contractor
is guilty of non-compliance or evasion of the Public Work Article of
the Labor Law, "the contractor shall be responsible for such
non-compliance or evasion."

Because Section 223 of the Labor Law holds contractors liable for the
non-compliance or evasion of sub-contractors, very often contractors
pay for the underpayment of prevailing wages on the part of
sub-contractors.  For example, a sub-contractor may underpay the
prevailing wages on a given project and declare bankruptcy shortly
after the completion of the project, leaving the general contractor to
pay all the underpaid wages.  Clearly, this is an unfair practice.

Requiring sub-contractors to deposit a surety bond for the payment of
prevailing wages will, at the very least, ease the underpayment burden
placed on contractors.  If it is determined that a sub-contractor has
underpaid the prevailing wage and the sub-contractor either does not
have the financial resources to pay the underpaid sum or the business
ceases to exist, there will be funds available to properly compensate
underpaid workers while protecting contractors from unfair monetary
liabilities.

 PRIOR LEGISLATIVE HISTORY :

1999-00: Remained in Committee 2001-02: Remained in Committee 2002-03:
Remained in Committee 2003-04: Remained in Committee 2005-06: Remained
in Committee 2007-08: Remained in Committee

 FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS :


Slight increases in the administrative expenses for the State and
municipalities.

 EFFECTIVE DATE :
This act shall take effect immediately.

2009-S5106 (ACTIVE) - Bill Text download pdf

                            
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  5106

                       2009-2010 Regular Sessions

                            I N  S E N A T E

                             April 27, 2009
                               ___________

Introduced  by  Sen.  SAVINO -- read twice and ordered printed, and when
  printed to be committed to the Committee on Labor

AN ACT to amend the labor  law,  in  relation  to  the  payment  of  the
  prevailing wage by subcontractors on public works projects

  THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. Section 220 of the labor law is amended by adding  a    new
subdivision 10 to read as follows:
  10.  SURETY  BOND  PAYABLE  BY SUBCONTRACTORS. ALL SUBCONTRACTORS ON A
PUBLIC WORK PROJECT SHALL BE REQUIRED TO SUBMIT A SURETY  BOND  FOR  THE
UNDERPAYMENT  OF   THE PREVAILING WAGE AND SUPPLEMENTS. WHERE THE FISCAL
OFFICER FOR THE PUBLIC WORK PROJECT IS THE COMMISSIONER, THE SURETY BOND
SHALL BE PAID TO THE COMMISSIONER FOR DEPOSIT  IN  THE  STATE  TREASURY.
WHERE  THE FISCAL OFFICER IS A CITY COMPTROLLER OR OTHER ANALOGOUS OFFI-
CER, THE SURETY BOND SHALL BE PAID TO SAID OFFICER FOR  DEPOSIT  IN  THE
CITY  TREASURY.  SUCH SURETY BOND SHALL BE IN THE SUM OF FIVE PER CENTUM
OF THE TOTAL PAYROLL OF THE SUBCONTRACTOR ON A PUBLIC WORK  PROJECT  AND
SHALL  BE  RETAINED BY THE FISCAL OFFICER FOR A PERIOD NOT TO EXCEED TWO
YEARS FOLLOWING THE COMPLETION OF THE PUBLIC  WORK  PROJECT.    INTEREST
SHALL  ACCRUE ON SUCH SURETY BOND AT A RATE OF FIVE PER CENTUM PER ANNUM
BEGINNING ON THE DATE OF DEPOSIT WITH THE FISCAL OFFICER  AND  SHALL  BE
DISPERSED ONLY AS SPECIFIED IN THIS SUBDIVISION. PROCEEDS FROM THE SURE-
TY  BOND  MAY  ONLY BE DISPERSED FOR THE PURPOSE OF REFUNDING THE SURETY
BOND TO A SUBCONTRACTOR TWO YEARS AFTER THE  EXPIRATION  OF  THE  PUBLIC
WORK PROJECT OR FOR THE PAYMENT OF WAGES OR SUPPLEMENTS DETERMINED TO BE
OWING  TO  WORKERS PURSUANT TO THIS SECTION. NOTHING IN THIS SUBDIVISION
SHALL BE CONSTRUED TO PRECLUDE SUBCONTRACTORS OR  CONTRACTORS  FROM  ANY
LIABILITY OR RESPONSIBILITY PURSUANT TO THIS ARTICLE.
  S  2.  Section  223 of the labor law, as amended by chapter 929 of the
laws of 1935, is amended to read as follows:

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD09660-01-9

S. 5106                             2

  S 223. Enforcement of article. If the fiscal officer as defined herein
finds that any person contracting with the  state,  a  municipal  corpo-
ration, or any commission appointed pursuant to law, for the performance
of any public work fails to comply with or evades the provisions of this
article,  he shall present evidence of such non-compliance or evasion to
the officer, department, board or commission having charge of such  work
for  enforcement.    Wherein such evidence indicates a non-compliance or
evasion on the part of a sub-contractor, the contractor shall be respon-
sible for such non-compliance or evasion; PROVIDED,  HOWEVER,  THAT  ANY
UNDERPAYMENT OF PREVAILING WAGES OR SUPPLEMENTS ON THE PART OF A SUBCON-
TRACTOR SHALL BE PAID PURSUANT TO SUBDIVISION TEN OF SECTION TWO HUNDRED
TWENTY  OF THIS ARTICLE. ONLY AFTER THE PAYMENT OF SUCH WAGES OR SUPPLE-
MENTS IS EXHAUSTED PURSUANT TO SUBDIVISION TEN OF  SECTION  TWO  HUNDRED
TWENTY OF THIS ARTICLE MAY A CONTRACTOR BECOME LIABLE FOR THE PAYMENT OF
SUCH WAGES OR SUPPLEMENTS ON BEHALF OF A SUBCONTRACTOR.  It shall be the
duty  of  any  officer, department, board or commission in charge of the
construction of such public work contracts to enforce the provisions  of
this article.
  S 3. This act shall take effect immediately.

Comments

Open Legislation is a forum for New York State legislation. All comments are subject to review and community moderation is encouraged.

Comments deemed off-topic, commercial, campaign-related, self-promotional; or that contain profanity, hate or toxic speech; or that link to sites outside of the nysenate.gov domain are not permitted, and will not be published. Attempts to intimidate and silence contributors or deliberately deceive the public, including excessive or extraneous posting/posts, or coordinated activity, are prohibited and may result in the temporary or permanent banning of the user. Comment moderation is generally performed Monday through Friday. By contributing or voting you agree to the Terms of Participation and verify you are over 13.

Create an account. An account allows you to sign petitions with a single click, officially support or oppose key legislation, and follow issues, committees, and bills that matter to you. When you create an account, you agree to this platform's terms of participation.