Labor Committee Proposals Will Harm Small Employers

The state legislature’s Labor and Public Employees Committee is reviewing a series of mandates that will have a devastating impact on small and mid-sized employers.

The proposals create new compliance standards, duplicative safety standards, increased litigation, and significant restrictions on routine business contractual procedures. 

While many of the bills are recycled versions of unsuccessful proposals from previous legislative sessions, there are several new measures in the mix.

‘Workforce Development’

HB 5003 is portrayed as a “workforce development bill,” with sweeping provisions impacting several of the state’s largest employment hubs.

The bill makes several changes across a range of industry sectors, particularly the healthcare, cannabis, and service contracting industries.

It requires healthcare employers to indemnify employees for workplace assaults and provide full wage continuation without charging leave, while also mandating new electronic reporting of patient violence through the state health information exchange.

This will upend existing protections through the workers’ compensation system, potentially leading to significant cost and liability increases for hospitals and community health centers. 

The bill expands the successor contractor law to numerous industries—including warehouses, residential complexes, hospitals, schools, and commercial buildings—requiring new contractors to retain prior employees for 90 days and imposing steep daily penalties for violations. 

The bill requires all employers to pay, in full, employees for shifts that are cancelled due to inclement weather.

5003 ropes the cannabis industry into contractual and licensure approval based on labor peace agreement cooperation, essentially moving the industry to mandated unionization.

It also requires all employers to pay, in full, employees for shifts that are cancelled due to inclement weather, leading to several concerns notably for the retail and restaurant industry, which dominantly require in person work.

That provision contradicts the federal Fair Labor Standards Act, which only requires employees to be paid when work is being done. 

While most of the bill poses significant cost increases for several sectors, there are some bright spots.

Sections 30-33, which invest in career and technical education, expands work-based learning infrastructure, encourages employer-school partnerships, provides potential grant support, strengthens workforce pipeline alignment, and improves accountability in workforce training systems.

All are recommendations from employers and educational workforce partners attempting to bridge the gap between education and employment opportunities. 

Payroll Reporting

SB 356 mandates a major change to reporting requirements for contractors on public works jobs, requiring private employers to submit monthly certified payroll records electronically to the labor commissioner.

The legislation requires contractors to maintain daily on-site worker log requirements, including arrival and departure times, and requires those logs to be maintained and submitted monthly.

The bill also strengthens enforcement by explicitly making the failure to file certified payroll or daily logs a Class D felony, increasing criminal exposure for noncompliance. 

Service Contract Workers

SB 358 represents a sweeping expansion of Connecticut’s existing service worker retention law, which currently only applies to food and beverage service workers at Bradley Airport.

The bill extends the law’s scope to include small, medium, and large employers, including large residential buildings, office complexes, schools, hospitals, utilities, warehouses, and colleges and universities.

The bill extends the law’s scope to include small, medium, and large employers.

It requires successor contractors to retain most existing service workers for at least 90 days, limits termination during that period to just cause, and removes prior flexibility related to performance history.

Enforcement of this measure shifts to the labor commissioner, who may award back pay, reinstatement, compensatory damages, and civil penalties of up to $500 per worker per day.

New Jersey is the only state in the country with a similar law. 

Wages, Paychecks, NDAs

HB 5386 requires employers with 50 or more employees to publish a public guide explaining every overtime and pay differential code they use.

This is not a current requirement, and will lead to all employers with 50 or more employees having to allocate resources to creating a public portal, include all pay codes associated with every position, and update it each time a change is made. 

HB 5387 expands wage transparency requirements by mandating that employers disclose the wage range and a general description of benefits in all public and internal job postings and provide that same information to applicants before any compensation discussions.

Current law requires employers to provide this information during the interview process. This year’s legislation takes it a step further by requiring employers to annually provide all current employees with the wage range and a description of benefits for their position.

HB 5386 requires employers with 50 or more employees to publish a public guide explaining every overtime and pay differential code.

The bill also implements statutory damages of $1,000–$10,000 punitive damages, attorney fees, and a two-year window to bring claims for employees who feel they were not provided with the required information. 

SB 355 significantly expands restrictions on nondisclosure and non-disparagement agreements, going well beyond the vast majority of states that have taken a more measured and narrow approach.

The bill will void and make unenforceable any agreement that prevents employees, independent contractors, or volunteers from disclosing or discussing conduct they reasonably believe involves discrimination, harassment, retaliation, wage and hour violations, sexual assault, or other conduct.

SB 355 also creates a new private right of action with statutory damages of $10,000.

These protections extend to current, former, and prospective workers, and apply broadly to employment agreements, contractor agreements, and certain pre-existing workplace NDAs signed during employment, making it retroactive and the most broadly worded NDA framework in the nation. 

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For more information, contact CBIA’s Paul Amarone (860.244.1978).