The proposed bill, titled "The Rhode Island Opportunity for Employee Ownership Act," aims to facilitate employee ownership of businesses in Rhode Island by establishing a new chapter in the General Laws. It defines key terms such as "employee-owned business," "qualified business," and "qualified employee group."

The act mandates that when the owner of a qualified business decides to sell at least fifty-one percent (51%) of the business, they must notify all current full-time and part-time employees within seven days of the decision. This notification must include the date of the notice, the owner's intent to sell, information about the opportunity for employees to form a group to purchase the business, details about the secretary of state's employee-owned business resource list, and any proposed sale price.

The bill outlines the rights and responsibilities of both the business owner and the employee group during the sale process. If a qualified employee group expresses interest in purchasing the business, they have thirty (30) days to signal their intent and one hundred eighty (180) days to negotiate a sale price. The act also provides tax exemptions for owners selling their businesses under certain conditions, specifically exempting them from state capital gains tax on gains from the sale of the qualified business under one million dollars ($1,000,000). Existing labor union membership or collective bargaining agreements will remain in effect under the new ownership structure.

Additionally, the Secretary of State's office is tasked with creating and maintaining a resource list to assist potential employee-owned businesses. Communication notices will be sent to businesses to inform them of this new law, and the act will take effect upon passage.