Committee hears bill to require notice to employees when a small business is for sale; proponents and business groups clash

The House Labor Committee on Wednesday heard testimony on H 5940, the Rhode Island Opportunity for Employee Ownership Act, a bill that would require eligible small-business sellers to notify employees when the business is listed or otherwise placed for sale and give employees a structured period to consider buying the business.

Supporters say the bill would preserve locally owned businesses, expand opportunities for worker ownership and help aging owners pass businesses to employees rather than see them close. Opponents—including manufacturing, construction and business trade groups—warned the measure would cause operational disruption, risk confidential information and deter buyers.

The bill, introduced by Representative Jennifer Stewart (absent from the hearing due to illness), would trigger notice and a process when an owner of a qualifying business signals intent to sell. Chloe Chasing, who identified herself as a worker-owner at White Electric and a co-founder of the Rhode Island Worker Cooperative Alliance, said the proposal would both support buyers and provide incentives for sellers. “It would incentivize that also…