AN ACT TO AMEND TITLE 19 AND TITLE 29 OF THE DELAWARE CODE RELATING TO CONTRACTOR REGISTRATION.

This Act provides a fair bidding environment for contractors who obey the law and protects the interests of workers and taxpayers by implementing recommendations from the review of the Workplace Fraud Act required by Senate Resolution No. 26 of the 149th General Assembly by making changes to the Workplace Fraud Act and creating the Delaware Contractor Registration Act. This Act revises the Workplace Fraud Act by doing all of the following: 1. Creates definitions for the terms “contractor”, "general contractor", "construction manager", "labor broker", "outside of the usual course of business", "place of business", and "subcontractor" and revises the definition of "independent contractor". 2. Explicitly prohibits labor brokers from providing construction services. 3. Allows general contractors, construction managers, and subcontractors to engage other construction companies in the same line of work as the general contractor, construction manager, or subcontractor. The Delaware Contractor Registration Act creates a contractor registration system to effectively regulate employee misclassification by doing all of the following: 1. Requires contractors to pay a small annual fee and apply for a certificate of registration to engage in construction activities in this State. 2. Requires registered contractors to establish compliance with State labor and revenue laws. 3. Requires that all contractors who work on a public works contract comply with the new contractor registration requirement. This Act also makes technical corrections to conform existing law to the standards of the Delaware Legislative Drafting Manual. This Substitute Bill differs from Senate Bill No. 95 as follows: 1. Clarifies the definition of “contractor” and “independent contractor”. 2. Narrows the information required for registration to requirements that are applicable to the contractor and to information the Department of Labor (Department) does not already have. 3. Requires the contractor to disclose if the contractor or a person holding a financial interest in the contractor's business has been convicted of home improvement fraud or new home construction fraud or found to have engaged in a prohibited trade practice. 4. Creates lower registration fees for contractors that do not have public works contracts. 5. Defines the circumstances when the Department can require a surety bond and when the surety bond must be released. 6. Clarifies the opportunity and process to request a hearing if the Department decides to take an action to against a contractor. 7. Makes this Act effective on October 1, 2020 and states that the Department will conduct education and information sessions statewide regarding this Act.