Includes whereas clauses.

Repeals the following sections of Article 3, Labor of Prisoners, in GS Chapter 148: GS 148-26 (State policy on employment of prisoners); GS 148-26.1 (Definitions); GS 148-26.5 (Pay and time allowances for work); GS 148-32.2 (Community work crew fee); GS 148-32.3 (Inmate Construction Program); and GS 148-33 (Prison labor furnished other State agencies). 

Retitles Article 3 as the Fair and Rehabilitative Prison Labor Act. Enacts GS 148-27.1 establishing State policy on the employment of incarcerated individuals and listing seven requirements of all work programs subject to the Article, including prioritizing training and skill development in industries with viable employment opportunities upon release, providing fair compensation with wages equal to the State minimum wage for Prison Industry Enhancement Certification Program (PIECP)-certified programs and at least $5.00 per hour for non-certified programs, and ensuring that incarcerated individuals are provided post-release employment assistance.

Enacts GS 148-27.2 setting forth defined terms. Defines incarcerated individual to mean a person in the custody of the Department of Adult Correction (DAC) or any other State or law enforcement agency. Makes changes throughout the Article to refer to incarcerated individuals rather than prisoner or inmate. Makes changes throughout the Article to make language gender neutral.

Enacts GS 148-27.3 prohibiting prison labor from being used to replace, displace, or supplement migrant, seasonal, or documented agricultural workers who have been affected by State or federal immigration enforcement actions. Requires that the Department of Labor conduct a labor market assessment to confirm a legitimate shortage before approving any prison labor contracts in the agricultural sector. Requires compensating incarcerated individuals for agricultural work at or above the prevailing wage for agricultural laborers in the State. Prohibits DAC from directly contracting with private farms. Requires DAC to annually report to the NCGA and Governor regarding the use of incarcerated individuals in agricultural labor. Details required content of the report.

Changes the circumstances by which a person under 16 years of age convicted of a felony can be imprisoned in the Central Prison in Raleigh under GS 148-28. Now requires both criteria to be met (was, either criteria): (1) the person is convicted of a capital felony; and (2) the person has previously been imprisoned in a county jail or under the authority of the Division of Prisons upon conviction of a felony.

Enacts GS 148-32.4 establishing a biannual requirement for DAC, in consultation with the Department of Transportation (DOT), to report to the NCGA and Governor regarding the work of incarcerated individuals on DOT and forestry work assignments. Details required content of the report. Prohibits compelling incarcerated individuals to work in road maintenance, construction, or forestry without voluntary participation and fair wages. Requires any forestry, conservation, or wildlife suppression work performed by incarcerated individuals to provide industry-recognized certification opportunities in firefighting, land management, and forestry to improve post-release employability. Requires DOT and forestry work medical assessments to be based on a comprehensive medical evaluation by a licensed healthcare professional and prohibits basing an assessment on outward appearance alone. Directs the Prison Labor Oversight Board established by the Article to conduct an annual audit of DOT and forestry work programs to ensure compliance with fair labor standards, workforce training foals, and public transparency requirements.

Enacts GS 148-32.5, establishing the Prison Oversight Board (Board) within DAC. Charges the Board with conducting annual audits of prison labor programs; ensuring compliance with PIECP standards and fair wage requirements; and investigating allegations of forced labor, unsafe working conditions, or wage exploitation. Directs DAC to biannually report to the NCGA and Governor regarding the work of incarcerated individuals and details required content of the report. Requires DAC to establish a Prison Labor Complaint Hotline to allow incarcerated individuals, their families and advocates to anonymously report labor violations, wage theft, or unsafe conditions related to work programs.

Makes technical and clarifying changes throughout the Article.

Provides a severability clause.

Effective July 1, 2026.