Reward Work Act

I 118TH CONGRESS 1ST SESSION H. R. 3694 To prohibit public companies from repurchasing their shares on the open market, and for other purposes. IN THE HOUSE OF REPRESENTATIVES MAY 25, 2023 Mr. GARCI´A of Illinois (for himself, Mr. KHANNA, Ms. HOYLE of Oregon, Mr. BOWMAN, Ms. BUSH, Mr. CARSON, Mr. CASAR, Ms. DELAURO, Mr. DELUZIO, Mr. DESAULNIER, Mr. FROST, Mr. GRIJALVA, Ms. JACKSON LEE, Ms. JAYAPAL, Mr. JOHNSON of Georgia, Mr. LANDSMAN, Ms. LEE of California, Ms. LEE of Pennsylvania, Mr. LIEU, Ms. MCCOLLUM, Mr. MCGOVERN, Mr. NORCROSS, Ms. NORTON, Ms. OCASIO-CORTEZ, Ms. OMAR, Mr. POCAN, Ms. PORTER, Ms. SCHAKOWSKY, Ms. TLAIB, and Mrs. WATSON COLEMAN) introduced the following bill; which was re- ferred to the Committee on Financial Services A BILL To prohibit public companies from repurchasing their shares on the open market, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Reward Work Act’’. 4 SEC. 2. PROHIBITION ON STOCK BUYBACKS ON THE OPEN 5 MARKET. 6 (a) DEFINITIONS.—In this section— 7 VerDate Sep 11 2014 04:17 Jun 17, 2023 Jkt 039200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H3694.IH H3694 pbinns on DSKJLVW7X2PROD with $$_JOB 2 •HR 3694 IH (1) the terms ‘‘equity security’’, ‘‘exchange’’, 1 and ‘‘issuer’’ have the meanings given the terms in 2 section 3 of the Securities Exchange Act of 1934 3 (15 U.S.C. 78c); and 4 (2) the term ‘‘national securities exchange’’ 5 means an exchange registered under section 6 of the 6 Securities Exchange Act of 1934 (15 U.S.C. 78f). 7 (b) PROHIBITIONS.—Notwithstanding any other pro- 8 vision of law, no issuer may purchase an equity security 9 of the issuer on a national securities exchange. 10 (c) NO FORCE OR EFFECT.—Section 240.10b–18 of 11 title 17, Code of Federal Regulations, shall have no force 12 or effect. 13 (d) RULE OF CONSTRUCTION.—Nothing in this sec- 14 tion may be construed to affect tender offers subject to 15 section 240.13e–4 and sections 240.14e–1 through 16 240.14f–1 of title 17, Code of Federal Regulations. 17 SEC. 3. WORKER REPRESENTATION ON CORPORATE BOARD 18 OF DIRECTORS. 19 (a) DEFINITIONS.—In this section— 20 (1) the term ‘‘director’’ has the meaning given 21 the term in section 3 of the Securities Exchange Act 22 of 1934 (15 U.S.C. 78c); and 23 (2) the term ‘‘employee’’— 24 VerDate Sep 11 2014 04:17 Jun 17, 2023 Jkt 039200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H3694.IH H3694 pbinns on DSKJLVW7X2PROD with $$_JOB 3 •HR 3694 IH (A) has the meaning given the term in sec- 1 tion 2 of the National Labor Relations Act (29 2 U.S.C. 152); and 3 (B) includes any individual employed by an 4 employer subject to the Railway Labor Act (45 5 U.S.C. 151 et seq.). 6 (b) REGISTRATION REQUIREMENTS FOR SECURI- 7 TIES.—Section 12 of the Securities Exchange Act of 1934 8 (15 U.S.C. 78l) is amended by adding at the end the fol- 9 lowing: 10 ‘‘(m) No issuer may register securities on a national 11 exchange unless at least 1⁄3 of the issuer’s directors are 12 chosen by the issuing company’s employees in a one-em- 13 ployee-one-vote election process.’’. 14 (c) POLICY.—The Securities and Exchange Commis- 15 sion, in consultation with the National Labor Relations 16 Board, shall promulgate regulations— 17 (1) to ensure that director elections at issuing 18 firms are fair and democratic; and 19 (2) to ensure that 1⁄3 of an issuer’s board of di- 20 rectors will be composed of employee representatives 21 within 2 years of the date of enactment of this Act. 22 SEC. 4. REGULATIONS. 23 The Securities and Exchange Commission shall pro- 24 mulgate regulations to direct national securities exchanges 25 VerDate Sep 11 2014 04:17 Jun 17, 2023 Jkt 039200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H3694.IH H3694 pbinns on DSKJLVW7X2PROD with $$_JOB 4 •HR 3694 IH and issuers, as defined in section 2(a), to comply with this 1 Act and the amendments made by this Act. 2 Æ VerDate Sep 11 2014 04:17 Jun 17, 2023 Jkt 039200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6301 E:\BILLS\H3694.IH H3694 pbinns on DSKJLVW7X2PROD with $$_JOB