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Beginning on October 1, general contractors in Maryland will become liable in instances in which subcontractors have not paid their employees. The effects of the law may increase the costs of projects themselves while also increasing consequences for both general contractors and subcontractors.

Senate Bill 853 follows similar bills enacted in other states which include provisions that make general contractors liable for the delay or non-payment of subcontractor employees by their employer. In particular, the provisions of SB853 include:

  • That an employee of a subcontractor can bring action against their employer after two weeks of a delay in payment after they were supposed to be paid.
  • That in the above case, a court may award the employee an amount up to three times the wage they are owed, along with "reasonable counsel fees and other costs."

California passed a similar bill into law in October 2017 and the law was made effective at the beginning of 2018.

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