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New Montgomery County Law Impacts Small Businesses

Small business and politics have been intertwined throughout our American history. Whatever your politics may be, it cannot be disputed that government regulation on all levels has enormous effects on small businesses. This is true of the Federal Government and especially true of our state and local governments. It is imperative that business owners be engaged in their local government to be aware of and informed about regulations, laws and other instances inwhich government affects private industry.

Recently, a bill was passed in Montgomery County that could have a large impact on private industry in general and small businesses in the contracting world in particular. Bill 19-12, Human Rights and Civil Liberties - Displaced Service Workers, sponsored by Councilmembers Ervin, Rice, Elrich, Riemer and Navarro, was introduced on May 15, 2012. A public hearing was held on June 12.

In pertinent part, Bill 19-12:

  • Generally regulates the displacement of certain service workers by a covered employer

  • Requires certain contractors to retain certain service workers for a 90-day transition period;

  • Provides for enforcement by the Office of Human Rights and the Human RightsCommission;

  • Authorizes the Human Rights Commission to award certain relief

This Bill impacts contractors in a number of ways. First, when bidding on a contract, a contractor typically makes a bid calculating all expected expenses, which includes salaries. Requiring the new contractor to hire carryover employees from the old contractor may place an unexpected burden on the new contractor, however. There’s a possibility that the old employees could be union workers, working under a collective bargaining agreement and perhaps working at higher salaries than the new contractor anticipated and budgeted for in its bid. In addition, the Bill calls for the new contractor to retain these employees based on seniority – removing any amount of choice and authority from the new contractor over the capability and qualification of its employees. Accordingly, the Bill was opposed by the Montgomery County Chamber of Commerce.

The Bill has been passed, but the lesson to be learned is much broader than the constraints of one particular bill. Small businesses should be involved and engaged in their local government to voice their opinions and ensure their interests are represented by their elected officials. Of course, having attorneys research and explain the details of a proposed bill or law is highly recommended and helpful. If you have any questions about a particular law and how it may impact your business, attorneys here at P.K. Hammar Legal are available to walk you through the requirements of the law and assist your business in being successful in the present and future.

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