AN ACT RELATING TO LABOR AND LABOR RELATIONS -- THE RHODE ISLAND OPPORTUNITY FOR EMPLOYEE OWNERSHIP ACT (Establishes an opportunity for employee ownership where the owner notifies all current full-time and part-time employees and provides them with a 30-day window in which to initiate a process to potentially purchase the business as a workers' cooperative.)

S2744

2026 -- S 2744
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LC005587
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STATE OF RHODE ISLAND
IN GENERAL ASSEMBLY
JANUARY SESSION, A.D. 2026
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A N A C T
RELATING TO LABOR AND LABOR RELATIONS -- THE RHODE ISLAND
OPPORTUNITY FOR EMPLOYEE OWNERSHIP ACT

Introduced By:
Senators Ciccone, Burke, Felag, and Acosta

Date Introduced:
February 27, 2026

Referred To:
Senate Labor & Gaming
It is enacted by the General Assembly as follows:
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SECTION 1. Title 28 of the General Laws entitled "LABOR AND LABOR RELATIONS"
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is hereby amended by adding thereto the following chapter:
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CHAPTER 61
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THE RHODE ISLAND OPPORTUNITY FOR EMPLOYEE OWNERSHIP ACT
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28-61-1. Definitions.
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As used in this chapter, the following words shall have the following meanings unless the
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context clearly requires otherwise:
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(1) "Owner" means the owner(s) of a qualified business prior to a qualified business sale.
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(2) "Qualified business" means an entity that:
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(i) Has operated a principal place of business in Rhode Island for at least one year;
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(ii) Is a taxpayer subject to Rhode Island taxes pursuant to title 44 including, but not limited
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to, a C corporation, S corporation, limited liability company, partnership, limited liability
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partnership, or a sole proprietorship;
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(iii) Is a privately held business;
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(iv) Has at least three (3) employees not including the owner, or other similar pass-through
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entity;
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(v) Meets the relevant size standards for a small business by industry, as set forth by the
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U.S. Small Business Administration in 13 CFR§ 121.201;

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(vi) Is not a publicly traded company; and
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(vii) Is not an exempt business as defined by one of the following circumstances: the sale
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or transfer of ownership to a family member; the sale or transfer of the business is necessitated by
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death or medical condition; the sale or transfer is compelled by court order; the sale or transfer of
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the business is necessitated in the event of deployment, natural disaster, or other emergency
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circumstance
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(3) "Worker cooperative business" means:
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(i) A workers' cooperative corporation organized under chapter 6.2 of title 7; or
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(ii) A limited liability company (LLC) or limited liability partnership (LLP), in either case,
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whose bylaws, operating agreement or partnership agreement, as applicable, meets the following
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requirements:
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(A) All persons who meet the definition of employee-owner ("worker-owner") according
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to the bylaws, operating agreement or partnership agreement of the business are voting members
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of the company, and have equal voting rights in all decisions brought before the membership; and
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(B) Any profits distributed to said worker-owners by the company are distributed on the
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basis of their patronage in the company, with patronage measured based on the labor supplied to
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the company.
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(4) "Worker cooperative business resource list" means a list of local and regional entities
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qualified to offer guidance, support, and/or technical assistance with starting, converting, or
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maintaining an employee-owned business. This resource list shall be created and maintained by the
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Rhode Island small business development center, or its designee, publicly visible and searchable
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on their website and updated on a regular basis.
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28-61-2. Notifying current employees about the sale of a qualified business.
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(a) In the event the owner of a qualified business decides to sell the qualified business, the
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owner shall notify all current full-time and part-time employees at the business.
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(b) The notice shall be posted on the date listed in the notice in a prominent location to
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which all employees have access, or if no such place exists, via an existing electronic medium used
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to communicate with employees.
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(c) The notice shall communicate:
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(1) Date of the notice;
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(2) The owner's intent to sell the business;
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(3) A date thirty (30) days from date of the written notice within which employees have an
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exclusive opportunity to officially initiate a process to potentially purchase the business as a worker
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cooperative. After this date, the qualified business owner may share the intent to sell publicly;

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(4) Information about the worker cooperative business resource list, including the URL or
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website; and
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(5) Any price the owner of the qualified business proposes for the business sale.
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28-61-3. Electronic notification of requirements.
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Notification of the provisions of this chapter shall be included in the worker cooperative
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business resource list and communicated to potential qualifying businesses by the Rhode Island
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commerce corporation established pursuant to § 42-64-4.
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28-61-4. Rules and regulations.
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The commerce corporation may issue reasonable rules and regulations consistent with this
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chapter to carry out the implementation of the responsibilities of this chapter.
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SECTION 2. This act shall take effect January 1, 2027.
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EXPLANATION
BY THE LEGISLATIVE COUNCIL
OF
A N A C T
RELATING TO LABOR AND LABOR RELATIONS -- THE RHODE ISLAND
OPPORTUNITY FOR EMPLOYEE OWNERSHIP ACT
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This act would establish an opportunity for employee ownership and the process whereby,
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if the owner of a qualified business decides to sell said qualified business, the owner would notify
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all current full-time and part-time employees and provide them with a thirty (30) day window in
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which to initiate a process to potentially purchase the business as a workers' cooperative.
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This act would take effect January 1, 2027.
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