Heated testimony for and against Delaware contractor-liability bill at Senate Labor Committee hearing

Senate Bill 63, a proposal that would make general contractors potentially liable for wage and classification violations committed by subcontractors, drew extensive testimony at the Delaware Senate Labor Committee meeting on Oct. 12, 2025. Sponsor Sen. Walsh and multiple witnesses from unions, trade associations and construction firms described competing views on who should bear enforcement responsibility and how to prevent misclassification and wage theft.

"This bill basically . . . ensure[s] that workers are properly classified as employees rather than independent contractors, securing them access to critical benefits like fair wages, unemployment insurance, and workmen's compensation," Sen. Walsh said in opening remarks. Supporters included representatives of the Eastern Atlantic States Regional Council of Carpenters who argued joint liability would deter bad actors and protect workers. Anthony Capelli, council representative, said, "This bill is not about punishing honest businesses. It's about leveling the playing field." Paul Krendergast, an attorney in the carpenters' labor compliance department, described cases in which workers were misclassified and only secured payment after collective action; he urged the committee to hold higher-tier contractors to a higher standard.

Opponents — including Desabatino Construction Company, Associated Builders and Contractors, the Home Builders Association of Delaware, the Delaware State Chamber of Commerce and the Delaware Contractors Association — warned the bill would impose liability on general contractors for subcontractors with whom they have no contractual relationship. Jeff Desabatino, vice president of Desabatino Construction, told the committee he was "here today to strongly oppose Senate Bill 63 as written," arguing general contractors often lack visibility into payroll and downstream subcontracting. The Home Builders Association noted an existing 2018 compromise that placed limits on liability for unknowing violations; Katie Gillis said reinstating joint, broad liability would increase compliance costs and risk pushing up housing prices.

Evidence cited in testimony included Department of Labor enforcement figures referenced by Sen. Walsh: 27 Workplace Fraud Act investigations that, he said, have not resulted in compliance; $1,052,500 in penalties for misclassification described as uncollected; an additional $93,000 issued to 44 unregistered contractors; and a registry of 5,737 registered contractors in the state. Witnesses proposed negotiating narrower enforcement tools, improved DOL capacity to pursue out-of-state offenders, or a stakeholder work group to refine liability language.

Outcome and next steps: the committee took public comment in order from a robust sign-up list and heard both pro and con testimony but did not vote on the bill at this hearing. Sponsors and stakeholders asked for follow-up discussions; several witnesses requested a small stakeholder working group to refine language that targets bad actors without imposing unworkable burdens on compliant contractors.