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Employment Discrimination
2014 Legislative Session: Final Report

On July 8, 2014, we passed the final deadline of the 2014 Legislative Session, the Veto Deadline.  The Veto Deadline is the date by which the Governor must either sign or veto a bill.  Any bill that is not vetoed becomes law “without the governor’s signature.”  This year, the Governor did not veto any of the employment-related bills.

Some of the bills that have became law include those addressing the following areas:

  • Minimum Wage (Act 82) – increases the states minimum wage
  • Private Guards (Act 94) – relaxes CE requirements for private guards
  • TDI (Act 160) – adds “organ donation” as an eligible disability to Hawaii’s TDI law
  • Organ, Bone Marrow or Stem Cell Donation (Act 161) - creates new leave law
  • Direct Deposit or Pay Cards (Act 208) – updates Hawaii payment of wages law
  • WC Drugs (Act 231) – sets price for repackaged, relabeled or combined WC drugs
  • Hawaii Health Connector (Act 233) – changes the operations of the Health Connector

A full list of bills that may be of interest to employers can be viewed on the HEC Legislative Digest, which can be accessed on the Legislative Updates section of the HEC website.  The Legislative Digest is currently available to the public.  In addition, HEC members can also access a Highlights article that discusses several of these new laws in more detail.

 
2014 Legislative Session: Running Updates

Each year, the Hawaii Employers Council provides its members with updates on labor and employment law bills that are being addressed by the legislature. One of those documents, the Legislative Digest, is actually currently available to the general public, and can be accessed here:  HEC Legislative Updates.

Bills that are still alive as of the Second Lateral deadline address (1) the minimum wage, (2) payment of wages via direct deposit and pay cards, and (3) workers’ compensation drugs, fee schedule and settlements.

For the 2014 Legislative Session, the Legislative Digest is available for the following key deadlines:

  • Bills Introduced (available)
  • First Lateral (available)
  • First Crossover (available)
  • Second Lateral (available)
  • Second Crossover (available)
  • Sine Die  (available)
  • Veto Deadline (available)

As more deadlines pass, I will update this blog entry to indicate when the most recent Legislative Digest is available.

Other updates, such as articles providing a detailed explanation of several of the significant measures and talking points on certain bills, however, are available only to HEC members.

 
Federal Judge Strikes Down Hawaii’s “Sick Leave Law”

On New Years Eve, U.S. District Court Judge Susan Oki Mollway issued an order ruling that Hawaii’s “sick leave law” – as passed during the 2011 state legislative session – was unlawful.

As background, in 2011, the State of Hawaii passed the “sick leave discrimination” law, which would prevent unionized employers with 100 or more employees from discriminating against an employee for using accrued and available sick leave.  Specifically, Act 118 from 2011 amended Section 378-32  to provide as follows:

(b)  It shall be unlawful for an employer or a labor organization to bar or discharge from employment, withhold pay from, or demote an employee because the employee uses accrued and available sick leave; provided that:

(1)  After an employee uses three or more consecutive days of sick leave, an employer or labor organization may require the employee to provide written verification from a physician indicating that the employee was ill when the sick leave was used;

(2)  This subsection shall apply only to employers who:

(A)  Have a collective bargaining agreement with their employees; and

(B)  Employ one hundred or more employees;

and

(3)  Nothing in this subsection shall be construed to supersede any provision of any collective bargaining agreement or employment benefits program or plan that provides greater employee benefits or rights.”

In a lawsuit entitled Hawaii Pacific Health, et. al. v Dwight Takamine, DLIR, several Hawaii employers sued the Hawaii Director of Labor to challenge the validity of this new law.  Their attorneys argued that that it this new state law (1) was preempted by Federal law and (2) violated the equal protection rights of unionized employers.  Judge Mollway agreed with both arguments, and struck down the law.

Specifically, the judge noted that the sick leave discrimination law was attempting to regulate conduct that should be “left to the control of economic forces.”  In other words, this was the type of issue that should be left to collective bargaining between a union and employer.  Additionally, the court also ruled that the law treated unionized employers less favorably than non-unionized employers.  Therefore, the law violated the equal protection rights of unionized employers.

The court set a hearing for April 15, 2013 to determine whether she would invalidate the entire law, or just the portion that referred to unionized employers.  (She also indicated an inclination, however, to strike down the entire law.)

You can read Judge Mollways decision here:  HPH v. Takamine.  You can view the original bill that led to the sick leave discrimination law here:  Sick Leave Bill.

 
The Newest Protected Class: The Unemployed?

President Obama’s proposed American Jobs Act has a provision that would make it unlawful for employers to (amongst other things) refuse to hire an individual “based on that individual’s status as unemployed.”  In the words of Seth and Amy of SNL fame:  Really, Mr. President?  Really?

Specifically, the proposed law has three major prohibitions regarding the unemployed.  First, employers cannot publish an advertisement stating that unemployed individuals would not qualify or would not be considered for a job opening.  Second, employers cannot fail or refuse to hire for employment, or fail or refuse to hire, an individual because of the individual’s status as unemployed.  Third, employers cannot direct or request that an employment agency take an individual’s status as unemployed into account to disqualify an applicant for a job position.

Based on this language, it appears the focus of the proposed law is to prevent discrimination because of an individual’s status as unemployed.

That being said, however, the law does allow employers to consider the reason an individual is unemployed.  Specifically, the proposed law would not preclude an employer or employment agency from considering an individual’s employment history or the reasons underlying an individual’s status as unemployed, in assessing an individual’s ability to perform a job or in otherwise making employment decisions about that individual.

Like most Americans, I too am in favor of lowering the unemployment rate and creating jobs for as many people as possible.  Yet, I cannot support this law because it would just create too many opportunities for unemployed individuals to file frivolous lawsuits against any employer that does not give them a job.  So, let’s just hope this proposed law doesn’t get enacted by Congress.

You can read a copy of the proposed law here.

 
New Employment Laws in Hawaii – 2011

The 2011 Legislative session was certainly not what I would call “employer-friendly,” to put it lightly.  This was the first time in over 8 years that both the legislature and governor’s office were controlled by the Democratic party.  Therefore, it was not surprising to see that many laws passed this year favored the rights of employees and labor unions, over the rights of employers.

For example, there were several changes to Hawaii’s anti-discrimination laws, which now make it unlawful for employers to discriminate against employees (a) for taking sick leave, (b) for their gender identity or expression, or (c) for their status as a victim of sexual or domestic violence.  In addition, another significant change to the law is that it now constitutes a criminal offense for an employer to not pay wages to their employees.

With the exception of the “domestic violence victim discrimination law,” all of these laws have already become effective.  Employers are advised to update their policies and handbooks accordingly.  These laws, and some others, are as follows:

Sick Leave Discrimination (Act 118, SB 1076) – This new law amends HRS 378-32, and prohibits employers who have (a) 100 or more employees and (b) a collective bargaining agreement with those employees, from barring, discharging from employment, withholding pay, or demoting an employee who uses accrued and available sick leave.

You can read my thoughts on this new law in a previous blog post here, and a copy of SB 1076 here.

Gender Identity Discrimination (Act 34, HB 546) – This new law amends HRS 378-2, and prohibits employers from discriminating against employees on the basis of “gender identity or expression.”  The way the law is written, discrimination based on “gender identity or expression” is considered a form of sex discrimination.

The legislature defined “gender identity or expression as “a person’s actual or perceived gender, as well as a person’s gender identity, gender-related self-image, gender-related appearance, or gender-related expression, regardless of whether that gender identity, gender-related self-image, gender-related appearance, or gender-related expression, is different from that traditionally associated with the person’s sex at birth.”

You can read a copy of HB 546 here.

Domestic Violence Victim Discrimination (Act 206, SB 229) – This new law also amends HRS 378-2 and prohibits employers from discriminating against employees or applicants who are the victims of sexual or domestic violence, if the victim notifies the employer of such status or the employer has actual knowledge of such status.

This new law also re-titles Hawaii’s “Victim Leave” law to “Victim Protections” and requires employers to make “reasonable accommodations in the workplace” for victims of domestic violence, such as changing the contact information of the employee, screening phone calls for the employee, restructuring the job functions of the employee, changing the work location of the employee, installing locks and other security devices, and allowing the employee to work flexible hours, unless providing such an accommodation would cause “undue hardship” on the work operations of the employer.

You can read a copy of SB 229 here.  (Note:  this law takes effect January 1, 2012)

Labor Trafficking and Nonpayment of Wages (Act 146, HB 141) – This new law provides new and specific penalties for labor trafficking offenses.

The part of this new that will have the most significant impact on most employers, however, is that it is now makes it a criminal offense not to pay wages owed to an employee.  Specifically, the new law states that a person commits the offense of “nonpayment of wages” if the person, acting in the capacity as an employer, intentionally or knowingly or with intent to defraud fails or refuses to pay wages to an employee. There is an exception to this rule, where an employer is required to make deductions from an employees wages under federal or state law, or court order.

A failure to pay wages of $2,000 or more constitutes a Class C felony.  In addition, it will also be a Class C felony if a person convicted of nonpayment of wages falsely denies the amount or validity of the wages owed.  A failure to pay wages of under $2,000 constitutes a Misdemeanor.  Finally, the law provides that each missed pay period will constitute a separate offense.

You can read a copy of HB 141 here.

Workers’ Compensation for Partnerships, LLC’s, etc. (Act 196, HB 519) – This new law provides that the following individuals are exempt from workers’ compensation coverage:  (a) a partner of a partnership, (b) a partner of an LLP who has 50% or more interest in the LLP, (c) a member of an LLC who has 50% or more interest in the LLC, and (d) sole proprietors.  You can read a copy of HB 519 here.

Partial Unemployment (Act 165, SB 1088) – This new law repealed the sunset provisions on partial unemployment benefits and removed the prior 8 week limitation on partial unemployment status.  In addition, this new law also established conditions for which an individual who has established eligibility based on full-time employment may be found to have good cause for voluntarily separating from subsequent part-time employment.  You can read a copy of SB 1088 here.

Increased HOSH Penalties (Act 123, SB 1040) – This new law imposes a 10% increase on monetary penalties for violations of the Hawaii Occupational Safety and Health Law.  You can read a copy of SB 104 here.