MarylandSB 00282026 Regular SessionSenate

Arbitration Reform for State Employees Act of 2026

Sponsored By: Cory V. McCray (Democratic)

Signed by Governor

State Government - PersonnelAppropriationsArbitration -see also- MediationBallots -see also- Abs&MailInBallots; Abs&MailInVotingBudgets -see also- Capital BudgetsCollective BargainingConstitutional AmendmentsElectionsEnvironmental Service, MarylandGovernorHigher Education -see also- Comm Colleges; Med Schools; etc.Legislation -see also- Correct Leg; Cur Leg; Emerg BillsMediation -see also- ArbitrationPrices -see also- Consumer Price IndexRevenue and Taxes -see also- (specific tax)Salaries and Compensation -see also- Overtime; Reimb. RatesState EmployeesState Universities and CollegesVoting -see also- Absentee and Mail-In Voting

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Bill Overview

Analyzed Economic Effects

5 provisions identified: 2 benefits, 1 costs, 2 mixed.

Public worker agreements continue, pensions excluded

Covered public employers and unions must bargain over pay, hours, health benefits, other benefits, and working conditions. Pensions are excluded from the required bargaining topics. Existing employee agreements stay in force without changes while talks continue. They cannot expire until a replacement is agreed to and ratified or adopted through arbitration.

Public worker arbitration has budget limits

Starting October 1, either side can declare stalled talks at an impasse and use binding arbitration. This process excludes state higher-education institutions, including the University System of Maryland. Each side generally submits its final offer within five business days; mediation comes before a hearing. Hearings must start within 30 calendar days after impasse and ordinarily finish within 45 calendar days, unless both sides agree otherwise. The arbitrator chooses one side's full final offer, subject to agreed terms, and reports the award's multi-year state budget impact. Awards are binding, but changes needing a new law or appropriation require General Assembly approval; wage decisions face state budget limits. Arbitrator fees are split equally between the parties.

Public worker talks get deadlines and help

Covered employers and unions must bargain in good faith between July 1 and September 30, aiming to start near July 1. Either side can request a neutral arbitrator starting July 1. If talks remain unresolved September 1, they must select one by September 15. These schedule and selection rules exclude state higher-education units and BWI Airport uniformed firefighters. Outside state higher education, arbitrators can mediate, help settle process disputes, and direct release of certain revenue and spending estimates. This advice is not binding and does not block unfair labor practice complaints.

Governor must budget for public worker agreements

The Governor must include funding for all terms of covered employee agreements in each annual budget bill. This covers agreements with the State, covered state higher-education institutions, and the Maryland Environmental Service. The law also ties added budget and reporting requirements to Maryland voters' approval of the constitutional amendment in November 2026. Those requirements cover next-year state employee agreements reached through bargaining or binding arbitration, reports of changed work terms, and committed salaries and benefits. No dollar amount is set, and including proposed funding does not itself approve an appropriation.

Fact-finding limited to public college bargaining

The statutory fact-finder process applies only to state higher-education bargaining, including the University System of Maryland. It covers talks for the next fiscal year that have not concluded before October 25. Other bargaining talks do not qualify for this process.

Sponsors & Cosponsors

Sponsor

Cory V. McCray
Democratic • Senate

Cosponsors

Malcolm Augustine
Democratic • Senate
Guy Guzzone
Democratic • Senate
Shelly Hettleman
Democratic • Senate
Nancy J. King
Democratic • Senate
Karen Lewis Young
Democratic • Senate
Jim Rosapepe
Democratic • Senate
Craig J. Zucker
Democratic • Senate

Roll Call Votes

All Roll Calls

Yes: 133 • No: 45

House vote • 4/10/2026

Third Reading Passed

Yes: 99 • No: 34 • Other: 5

Senate vote • 3/19/2026