Business leaders hailed state lawmakers for ending Rhode Island’s prohibition on biweekly pay this past summer to remove what they described as a longstanding barrier to improving the state’s poor economic climate.
Their celebration turned to frustration this fall however, as the R.I. Department of Labor and Training unveiled the red tape that would await companies looking to take advantage of the new opportunity.
Permission to pay hourly workers biweekly will only last for two years, requiring companies to go through the application process and satisfy the state’s requirements every 24 months.
“This relatively short time period places an unnecessary burden on employers – particularly on those larger firms that run payroll in other states, by requiring them to arbitrarily reapply to the department for approval,” 13 business groups, including the Greater Providence Chamber of Commerce, opposing the two-year limit said in a letter to labor-department officials. “This two-year limit creates yet another regulatory obstacle for companies operating in Rhode Island, and therefore should be reconsidered.”
Kelly Rogers, manager of policy and public affairs at the Rhode Island Public Expenditure Council, called the rule “one step forward and two steps back.” She urged state officials to consider the state’s 9.2 percent unemployment rate in its rulemaking.
Companies like paying workers in longer intervals to save money spent cutting checks and processing electronic transfers.
And according to DLT spokeswoman Nicole Romeo, the department has no record of any complaints, ever, from workers about not being paid weekly.
But workers’ advocates and organized labor say delaying the wages of people living paycheck to paycheck can leave them short of cash.
To protect workers and mollify concerns by organized labor, the General Assembly included a number of conditions in the biweekly-pay bill that the labor-department regulations are a response to.
Only companies who pay more than 200 percent of the state minimum wage were given explicit permission to pay biweekly. The law requires employers paying less than 200 percent to show “good cause” and hardship, plus provide additional information.
Union shops must collectively bargain the change and all employers are required to provide proof of funds to cover the highest biweekly payroll of the year.