An Act amending the act of April 9, 1929 (P.L.177, No.175), known as The Administrative Code of 1929, providing for Commonwealth grantee employment verification; establishing the Commonwealth Grantee Employment Verification Account; and imposing penalties.

PRINTER'S NO. 2190
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No. 1781
Session of
2025
INTRODUCED BY BARGER, M. MACKENZIE, SMITH, KRUPA, KAUFFMAN,
BERNSTINE, GLEIM, ZIMMERMAN, FINK, ROWE, DAVANZO AND WALSH,
AUGUST 4, 2025
REFERRED TO COMMITTEE ON STATE GOVERNMENT, AUGUST 4, 2025
AN ACT
Amending the act of April 9, 1929 (P.L.177, No.175), entitled
"An act providing for and reorganizing the conduct of the
executive and administrative work of the Commonwealth by the
Executive Department thereof and the administrative
departments, boards, commissions, and officers thereof,
including the boards of trustees of State Normal Schools, or
Teachers Colleges; abolishing, creating, reorganizing or
authorizing the reorganization of certain administrative
departments, boards, and commissions; defining the powers and
duties of the Governor and other executive and administrative
officers, and of the several administrative departments,
boards, commissions, and officers; fixing the salaries of the
Governor, Lieutenant Governor, and certain other executive
and administrative officers; providing for the appointment of
certain administrative officers, and of all deputies and
other assistants and employes in certain departments, boards,
and commissions; providing for judicial administration; and
prescribing the manner in which the number and compensation
of the deputies and all other assistants and employes of
certain departments, boards and commissions shall be
determined," providing for Commonwealth grantee employment
verification; establishing the Commonwealth Grantee
Employment Verification Account; and imposing penalties.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. The act of April 9, 1929 (P.L.177, No.175), known
as The Administrative Code of 1929, is amended by adding an
article to read:
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ARTICLE XXIV-D
COMMONWEALTH GRANTEE EMPLOYMENT VERIFICATION
Section 2401-D. Definitions.
The following words and phrases when used in this article
shall have the meanings given to them in this section unless the
context clearly indicates otherwise:
"Account." The Commonwealth Grantee Employment Verification
Account established under section 2407-D(a).
"Commonwealth agency." As follows:
(1) An office, department, authority, board, multistate
agency or commission of the executive branch, an independent
agency and a State-affiliated entity.
(2) The term includes:
(i) The Governor's Office.
( ii) The Office of Attorney General.
(iii) The Department of the Auditor General.
(iv) The Treasury Department.
(v) An organization that is:
(A) established by the Constitution of
Pennsylvania, a statute or an executive order; and
(B) performs or is intended to perform an
essential governmental function.
(3) The term does not include a judicial agency or
legislative agency.
"Department." The Department of General Services of the
Commonwealth.
"Employee." An individual hired by a grantee, contractor or
subcontractor, for whom the grantee, contractor or subcontractor
is required by law to file a Form W-2 with the Internal Revenue
Service.
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"EVP." The E-Verify Program operated by the Department of
Homeland Security that electronically verifies employment
eligibility for employees.
"Grantee." A person that receives a State grant.
"Grantor agency." A Commonwealth agency that awards a State
grant to a grantee.
"Judicial agency." A court of this Commonwealth or an
agency, authority, board, commission, office or similar entity
of the unified judicial system.
"Legislative agency." The General Assembly or an agency,
authority, board, commission, office or similar entity of the
General Assembly.
"Procurement." As defined in 62 Pa.C.S. § 103 (relating to
definitions).
"State grant." As follows:
(1) A grant that:
(i) is authorized by a law of this Commonwealth; and
(ii) will be used to pay, in whole or in part, the
wages of an employee of a grantee, contractor or
subcontractor.
(2) The term does not include:
(i) A tax benefit.
(ii) A tax credit.
(iii) A procurement.
(iv) Money appropriated or transferred for a purpose
other than a State grant.
"Subcontractor." As follows:
(1) A person, regardless of tier, that performs work or
provides services that will be paid for, in whole or in part,
with money from a State grant.
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(2) The term includes a staffing agency.
(3) The term does not include:
(i) An individual.
(ii) A supplier of materials or equipment purchased
with money from a State grant.
"Tax benefit." As defined in section 1701-A.1 of the act of
March 4, 1971 (P.L.6, No.2), known as the Tax Reform Code of
1971.
"Tax credit." As defined in section 1701-A.1 of the Tax
Reform Code of 1971.
"Willful violation." Action or conduct undertaken
intentionally or with reckless disregard for or deliberate
ignorance of the requirements and obligations established under
this article.
Section 2402-D. EVP.
(a) Participation and use.--Each grantee, contractor or
subcontractor shall participate in EVP and shall, subject to the
requirements of Federal law governing the use of EVP, use EVP to
verify employment eligibility of each new employee of the
grantee, contractor or subcontractor.
(b) Notice.--Each grantor agency shall post on its publicly
accessible Internet website information regarding the
requirements of Federal law governing the use of EVP with the
information and application for any State grant.
(c) Discrimination prohibited.--In conducting the
verification required by this section, a grantee, contractor or
subcontractor may not discriminate against an employee on the
basis of race, ethnicity, color or national origin.
Section 2403-D. Verification form.
(a) Development.-- The department shall develop a
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verification form in accordance with this section to be used by
grantees, contractors and subcontractors.
(b) Execution.--The verification form must be completed and
signed by a representative of the grantee, contractor or
subcontractor, as applicable, who has sufficient knowledge and
authority to make the representations and certifications
contained in the verification form.
(c) Contents.--The verification form under this section must
contain:
(1) A statement that the grantee, contractor or
subcontractor:
(i) A cknowledges its responsibilities under and its
compliance with section 2402-D.
(ii) Is enrolled in EVP.
(2) A certification that:
(i) The information in the statement under paragraph
(1) is true and correct.
(ii) The individual completing and signing the
verification form understands that the submission of
false or misleading information in connection with the
verification form shall subject the individual and the
grantee, contractor or subcontractor, as the case may be,
to sanctions as provided by law.
(d) Posting.--The department shall post the verification
form under this section on the publicly accessible Internet
website of the department for use by grantor agencies, grantees,
contractors and subcontractors.
(e) Submittal.--
(1) Prior to the execution of a grant agreement between
a grantor agency and grantee for the award of a State grant,
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the grantor agency shall provide to the grantee a
verification form under this section, which must be completed
and signed in accordance with this section.
(2) P rior to a grantee performing work or providing
services that will be paid for, in whole or in part, with
money from a State grant, a contractor or subcontractor shall
provide to the grantee a verification form under this
section, which must be completed and signed in accordance
with this section.
(f) Contracts.--
(1) A c ontract between a grantee and a contractor or
between a grantee's contractor and its subcontractors shall
contain information about the requirements of this article.
(2) A contract between a contractor and its
subcontractors shall contain information about the
requirements of this article.
Section 2404-D. Violations.
A grantee, contractor or subcontractor violates this article
if the grantee, contractor or subcontractor:
(1) Fails to verify the employment eligibility of a new
employee through EVP in accordance with this article.
(2) Fails to provide the verification form in accordance
with this article or submits false or misleading information
in connection with the completion and execution of a
verification form under this article.
Section 2405-D. Enforcement.
(a) Authorization.--Each grantor agency shall enforce this
article with regard to State grants that it has awarded.
(b) Investigation of complaints.--A grantor agency shall
accept, review and investigate in a timely manner any credible
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complaint that a grantee, contractor or subcontractor has
violated a provision of this article.
(c) Audits.--To ensure compliance with the requirements of
this article, a grantor agency shall conduct complaint-based and
random audits of grantees, contractors and subcontractors.
(d) Reimbursements.--
(1) A grantor agency may require a grantee, contractor
or subcontractor to reimburse the grantor agency for the cost
of the amount of a State grant that it has received if the
grantee, contractor or subcontractor is:
(i) debarred from public work in accordance with
section 2406-D; or
(ii) subject to a civil penalty in accordance with
section 2406-D(b).
(2) A grantor agency may require a grantee, contractor
or subcontractor to reimburse the grantor agency for the cost
of an audit under subsection (c), which shall be reasonably
based on the amount of staff time spent on conducting the
audit.
Section 2406-D. Civil penalties and sanctions.
(a) EVP.--The following sanctions shall apply only to a
violation under section 2404-D(1):
(1) For a first violation, a grantee, contractor or
subcontractor shall receive a warning letter from the grantor
agency detailing the violation. The warning letter shall be
posted on the publicly accessible Internet website of the
grantor agency.
(2) For a second violation, a grantee, contractor or
subcontractor shall be debarred from receiving a State grant,
performing work or providing services that will be paid for,
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in whole or in part, with money from a State grant, for a
period of 60 days.
(3) For a third violation and subsequent violations, a
grantee, contractor or subcontractor shall be debarred from
receiving a State grant, performing work or providing
services that will be paid for, in whole or in part, with
money from a State grant, for a period of not less than one
year and not more than two years.
(4) In the case of an alleged willful violation, the
grantor agency shall file a petition in Commonwealth Court
seeking to have the court issue a rule to show cause why a
grantee, contractor or subcontractor did not engage in the
willful violation. If the court finds that the grantee,
contractor or subcontractor engaged in a willful violation,
the court shall order that the grantee, contractor or
subcontractor be debarred from receiving a State grant,
performing work or providing services that will be paid for,
in whole or in part, with money from a State grant, for a
period of three years.
(5) Notwithstanding the provisions of paragraph (1), (2)
and (3), a violation by a grantee, contractor or
subcontractor that occurs 10 years or more after a prior
violation shall be deemed to be a first violation.
(6) For the purposes of assessing sanctions, violations
committed by a grantee, contractor or subcontractor subject
to this article involving a single State grant shall be
considered a single violation despite the number of employees
that are the subject of the violations.
(b) False or misleading information.--The following
sanctions shall apply only to a violation under section 2404-
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D(2):
(1) A grantee, contractor or subcontractor that violates
section 2404-D(2) shall be subject to a civil penalty of not
less than $2,500 and not more than $25,000 for each
violation, to be imposed by the grantor agency based on the
duration and severity of the violation.
(2) In addition to the penalty under paragraph (1), in
the event of a willful violation of section 2404-D(2), a
grantee, contractor or subcontractor shall be subject to
debarment for a period not less than 60 days nor more than
three years, depending on the duration and severity of the
violation.
(c) Notice and appeal.--Actions taken by a grantor agency
under subsections (a)(1), (2) and (3) and (b) shall be subject
to the notice, appeal and other provisions of 2 Pa.C.S.
(relating to administrative law and procedure).
Section 2407-D. Commonwealth Grantee Employment Verification
Account.
(a) Establishment.--The Commonwealth Employment Verification
Account is established as a restricted revenue, interest-bearing
account in the General Fund.
(b) Deposits.--Each grantor agency shall deposit penalties
collected under section 2406-D(b) into the account.
(c) Use of account.--Money in the account and interest
earned on the account is appropriated on a continuing basis to
each grantor agency, based on the amount of deposits under
subsection (b) attributable to each grantor agency, for the
purposes of administering and enforcing the provisions of this
article.
Section 2408-D. Protection from retaliation.
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(a) Prohibition.--It shall be unlawful for a grantee,
contractor or subcontractor to discharge, threaten or otherwise
retaliate or discriminate against an employee regarding
compensation or other terms or conditions of employment because
the employee:
(1) participates in an investigation, hearing or inquiry
held by the grantor agency or another governmental authority
under this article; or
(2) reports or makes a complaint regarding the violation
of this article to a grantee, contractor or subcontractor or
to a governmental authority.
(b) Actions.--
(1) An employee who suffers retaliation or
discrimination in violation of this section may bring an
action in a court of common pleas in accordance with
established civil procedures of this Commonwealth.
( 2) The action under paragraph (1) must be brought
within 180 days from the date the employee knew of the
retaliation or discrimination.
(c) Relief.--If an employee prevails in an action commenced
under this section, the employee shall be entitled to the
following relief:
(1) Reinstatement of the employee, if applicable.
( 2) Restitution equal to three times the amount of the
employee's wages and fringe benefits calculated from the date
of the retaliation or discrimination.
(3) Reasonable attorney fees and costs of the action.
(4) Any other legal and equitable relief as the court
deems appropriate.
Section 2409-D. Good faith immunity.
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A grantee, contractor or subcontractor that relies in good
faith on EVP procedures to verify employment eligibility of new
employees under this article shall be immune from the sanctions
authorized under section 2406-D and shall have no liability to
an individual who is not hired or who is discharged from
employment if incorrect information is provided to the grantee,
contractor or subcontractor. A grantee, contractor or
subcontractor that produces written acknowledgment provided by
an applicable Federal agency of use of EVP is considered to have
acted in good faith.
Section 2410-D. Liability.
Nothing in this article may be construed to render:
(1) A grantee liable for the action of a contractor or
subcontractor.
(2) A contractor liable for the action of a
subcontractor.
(3) A subcontractor liable for the action of another
subcontractor.
Section 2411-D. Rules and regulations.
Each grantor agency may adopt or promulgate rules or
regulations necessary to administer and enforce this article for
State grants within its purview.
Section 2412-D. Cooperation among departments.
A grantor agency may enter into agreements with the
department, the Department of Labor and Industry or any other
Commonwealth agency to provide for the cooperative enforcement
of the provisions of this article.
Section 2. This act shall take effect in 60 days.
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