Maryland General Assembly Passes Bills Affecting Employers

April 29, 2010

The Maryland General Assembly passed several bills affecting employers during its recently completed 2010 legislative session. Some of those bills have already been signed into law. Others await the Governor’s signature. All of these new laws raise important issues about which employers doing business in Maryland need to be aware.

Changes to the Wage Payment and Collection Law

The Governor has signed into law two changes to the Maryland Wage Payment and Collection Law (WPCL).

First, the legislature has created a new mechanism for employees to assert a claim for unpaid wages in an amount of $3,000 or less, which goes into effect Oct. 1, 2010. Under this new law, an employer must respond within 15 days of receiving notice of a complaint filed with the Commissioner of Labor and Industry. If the Commissioner concludes that a violation has occurred, the Commissioner may issue an order requiring the employer to pay wages and possibly interest. When an employer receives such an order, it must request a hearing from the Commissioner within 30 days, or the order will become final and enforceable in court.

Second, the legislature amended the definition of “wage” to specifically include overtime wages.

Healthy Retail Employee Act

The legislature also recently passed the Healthy Retail Employee Act, which would require covered retailers in Maryland to provide mandatory break periods to certain non-exempt retail employees.

  • The Act generally applies to retailers with at least 50 retail employees during each working day for 20 or more weeks in the preceding or current calendar year. However, the Act specifically excludes wholesalers and restaurants. It also does not apply to employees who work for at least four consecutive hours at a location of a covered employer with five or fewer employees.
  • The duration of the required break periods varies based on the number of hours worked by an employee in a given shift. Generally, the Act provides that covered employees who work four to six consecutive hours are entitled to a 15-minute non-working break; six consecutive hours or more are entitled to a 30-minute non-working break; more than eight consecutive hours an additional 15-minute non-working break for every additional four consecutive hours worked.
  • The Act also permits covered employers and employees to enter into written agreements to waive some of the Act’s requirements in certain situations.

The Act contains a process for employees to file a complaint with the Commissioner of Labor and Industry if they believe the law has been violated. Remedies for violations include an order directing compliance with the law and imposing civil penalties of $300 – $600 per employee for whom the employer is out of compliance with the Act. Additionally, in limited situations, a covered employee could bring an action in the appropriate court to enforce the Commissioner’s order and for recovery of treble damages, reasonable attorneys’ fees and costs.

If signed by the Governor, the Act will go into effect March 1, 2011.

Civil Air Patrol Leave Act of 2010

The Civil Air Patrol Leave Act of 2010 requires employers with more than 15 employees to provide at least 15 days of unpaid leave per calendar year to eligible employees to respond to an authorized emergency mission of the Maryland Wing of the Civil Air Patrol. An eligible employee is required to provide advance notice of the need for Civil Air Patrol leave and to update the employer regarding changes in the amount of leave required as the employee’s mission progresses. The Act prohibits an employer from requiring an employee to exhaust all other forms of leave available to the employee before taking Civil Air Patrol leave, and it contains additional provisions regarding job reinstatement and the treatment of an employee’s benefits while on leave. It also prohibits discrimination and retaliation.

If signed by the Governor, the Act will go into effect Oct. 1, 2010.

Job Creation and Recovery Tax Credit

Maryland has also enacted the Job Creation and Recovery Tax Credit, which provides for a credit against Maryland income tax for employers who hire certain unemployed individuals between Jan. 1, 2010 and Dec. 31, 2010. The credit is equal to $5,000 per eligible employee hired, up to a limit of $250,000 per taxpayer. The Department of Labor, Licensing and Regulation may award up to $20,000,000 in credits on a first come, first served basis.

For additional information regarding each of these laws and how they may impact your business, please contact any member of McGuireWoods’ Baltimore Labor and Employment team.