With the swearing-in of newly elected Rep. Dan Goughnour (D-Allegheny) last Monday, House Democrats officially returned to the full complement of their one-seat majority. Throughout the week, the lower chamber reviewed several proposals affecting Pennsylvania businesses, including legislation related to workers’ compensation, worker classification, permitting, and transportation funding.

Here is a recap of last week’s legislative action most relevant to employers:

 

Increasing Workers’ Comp Costs (H.B. 183; Dawkins)

The House of Representatives voted 118-85 to pass House Bill 183 last Monday.

This legislation would amend a section of Pennsylvania’s Workers’ Compensation Act that deals with so-called permanent disfigurement, informally known as the “scar benefit.”

Under workers’ compensation law, employers are responsible for paying medical costs and wage-loss benefits for individuals who are injured on the job, regardless of fault. Current law also provides for additional benefits for various reasons, including if an injury results in a scar on the head, neck, or face that produces an “unsightly appearance.”

House Bill 183 would expand the scar benefit far beyond its original purpose and lead to higher insurance and related costs for Pennsylvania businesses. We opposed this legislation (CLICK HERE for our memo); it now heads to the Senate.

 

Penalties on Employers (H.B. 721; Donahue)

The House Labor & Industry Committee voted 14-12 to advance House Bill 721 last Wednesday.

This legislation proposes several amendments to the Construction Workplace Misclassification Act.

The amendments proposed in this bill include severe penalties against employers for violations of this notoriously vague and complicated law, the threat of permanent debarment from Commonwealth contracting opportunities, and new opportunities for trial lawyers to sue construction companies.

We opposed this legislation (CLICK HERE for our memo), which advances to the full House.

 

Burdensome Environmental Permitting Requirements (H.B. 109; Vitali)

The House Environmental and Natural Resource Protection Committee voted 14-12 to advance House Bill 109 last Monday.

This legislation would grant the Pennsylvania Department of Environmental Protection (DEP) the authority to designate environmental justice areas in Pennsylvania. The bill requires applicants to submit a cumulative environmental impact report before issuing permits in these areas and mandates a more extensive public hearing process for these permits.

Under this legislation, DEP can impose additional conditions, require mitigation measures, or even deny a permit based on the cumulative environmental impacts of a proposed project. This creates ambiguity, additional regulatory uncertainty, and poses significant risks to economic growth, business investment, and Pennsylvania’s overall competitiveness.

We opposed this bill (CLICK HERE for our memo), which now advances to the full House.

 

Removing State Police Funding from Motor License Fund (H.B. 1085; Neilson)

The House Transportation Committee unanimously voted to advance House Bill 1085 last Monday.

This legislation would expedite the planned phase-out of Pennsylvania State Police (PSP) operations funding from the Motor License Fund (MLF), permitting one final appropriation of $125 million in Fiscal Year 2025-26, and reducing to $0 in Fiscal Year 2026-2027 and each year thereafter. The Governor’s most recent budget proposal included slowing the planned phase-out schedule of the PSP’s reliance on the MLF to just $50 million a year until reliance is completely removed in FY 2029-30 – four years slower than his original proposal. However, HB 1085 would speed up that process significantly, ensuring that more resources are available for vital infrastructure projects as soon as FY 2026-27.

It is well documented that public investment in transportation infrastructure generates a high return on investment in economic activity. The repair and maintenance of Pennsylvania’s roads and bridges are primarily funded by the MLF which receives revenues from the gas tax, motor vehicle fees, driver’s license fees, and other provisions. Since 1937, a portion of the PSP annual budget has been funded by the MLF.

We recognize and appreciate the invaluable services performed by the PSP, and their work should continue to be fully funded. However, every dollar taken from MLF is one less dollar spent on our roads and bridges desperately in need of modernization. The PA Chamber supports an expedited phaseout of PA State Police funding from the Motor License Fund to enable further investment in the transportation infrastructure on which our economy heavily relies.

We supported this bill (CLICK HERE for our memo), which now advances to the full House.