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Legislative Updates
Quote in Hawaii Business Magazine Article on Paycards

The August 2014 issue of Hawaii Business Magazine contains an article discussing a new law that was passed from the 2014 legislative session which modernizes Hawaii’s payment of wages law by clarifying that employers may pay their employees’ wages by direct deposit or paycards under certain circumstances.   The author of the article, Alex Bitter, and I had a lengthy conversation about the new law, and he ended up quoting me a couple of times for the article.

Under Hawaii’s old law, employers were only permitted to pay wages via “cash” or “check.”  (Technically, the DLIR previously authorized the payment of wages via direct deposit and paycards, but that authorization came from the department’s administrative authority and did not actually amend Hawaii’s law.  Rather, it simply provided the department’s interpretation of Hawaii’s payment of wages law.)

This new law, Act 208, expressly authorizes employers to pay employees via direct deposit or paycards, if certain conditions are met.  For direct deposit, the employer must comply with six different requirements, including obtaining voluntary authorization in writing, using a financial institution that is insured by the FDIC or comparable agency, allowing the employee to cancel the direct deposit at any time, providing a pay statement to the employee, and not requiring the employee to pay any costs or fees for the direct deposit.

For paycards, employers must comply with 12 different requirements, including providing a notice to employees of paycard conditions, accepting responsibility for fees assessed against the employee that are outside the paycard fee schedule, and allowing employees the ability to make at least three free withdrawals on the card (at least one of which permits withdrawal of the full amount of the employee’s net wages).

You can read a copy of the new law here:  Act 208.  You can also read a copy of the Hawaii Business Magazine article here:   New Rules Make Paycards More Costly for Companies.

 
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.

 
Presentation for University of Hawaii’s HR Ohana Meeting

Yesterday, I had the opportunity to speak at the HR Ohana Meeting to about 100 human resources professionals from all campuses of the University of Hawaii, which included the Manoa campus, as well as all neighbor island campuses and community colleges.

The meeting took place at Windward Community College, and man, I had no idea that WCC had such a beautiful campus.  On one side of the campus, you have a majestic view of the Koolau mountain range.  On the other side, you have a magnificent view of the ocean.  It was incredible, to say the least.

I was asked to speak about current hot topics in labor and employment law, so I included the following four topics in my presentation:  (1) 2014 legislative update; (2) social media and the workplace; (3) the possible unionization of Northwestern University football players and (4) employment law rights of same-sex couples in Hawaii following the Windsor court decision and legalization of same-sex marriage in Hawaii.

One of the speakers who presented before me talked about the “HR Tsunami” and how the duties of HR professionals in the workplace are becoming more significant as they take on more active roles in the strategic planning and management of corporations.  In other words, HR professionals are not just performing administrative functions.  I felt that this particular topic was a great segue into my presentation, because it gave me an opportunity to discuss the importance of being proactive in employment-related decisions and reinforce my motto that “the best defense is a good offense.”  It was also good to see that so many people chose to attend the meeting; considering that it was voluntary, having 100 attendees is fantastic because it shows that these HR professionals are doing their own part to be more proactive about their job functions.

 
Governor Signs Minimum Wage Bill

On Friday before Memorial Day Weekend, Governor Abercrombie signed SB 2609 CD1 - the minimum wage bill from the 2014 legislative session - into law.  The state’s minimum wage is currently $7.25.  This bill will increase the minimum wage four times over the next four years as follows:

  • January 1, 2015 – $7.75
  • January 1, 2016 – $8.50
  • January 1, 2017 – $9.25
  • January 1, 2018 – $10.10 (<– Clayton Hee got that extra $0.10 that he wanted.)
In addition, this bill also increases the state’s tip credit (which is currently just 25 cents per hour) to 50 cents on January 1, 2015 and 75 cents on January 1, 2016.  In order to take any tip credit, however, the employee at issue must earn at least $7.00 above the minimum wage in tips and wages.  In effect, an employee must earn $7.50 an hour in tips beginning January 1, 2015 and $7.75 an hour in tips beginning January 1, 2016 for an employer to take a tip credit.  While this increase in the tip credit may be welcome news for some businesses, other employers will lose the tip credit altogether for employees who earn less than $7.50/$7.75 an hour in tips.  In other words, those employers will lose the 25 cent tip credit they currently utilize.

 
2014 Legislative Session: The End is Near(ing)

Let the conference games begin!

Just last week, we passed the Second Crossover deadline, which is the date that the Senate must complete its review of bills submitted by the House of Representatives, and vice versa.  Bills that have survived the Second Crossover deadline are now either (a) sent to conference or (b) sent to the Governor for his review/approval/veto.

At this point in the legislative session, there are still several bills remaining that would have an impact on how employers conduct business here in Hawaii.  Such bills include measures that address:

  • Minimum Wage
  • Payment of Wages
  • Temporary Disability Insurance
  • Workers’ Compensation
  • Healthcare Issues
  • Smoking in the Workplace
  • Criminal Background Checks
  • And others…

As I’ve noted in the “Running Updates” post here, the HEC Legislative Digest following Second Crossover is now available for viewing on the Legislative Updates section of the HEC Website.   In addition, HEC members can also access a Highlights article that discusses several of these key measures in more depth.

Conference hearings will begin this week.  As the Senate and House wrestle over the language of the pending bills, it will be interesting to see what type of concessions are made by either side and what type of legislation is ultimately passed.