STAND. COM. REP. NO. 2419

                                   Honolulu, Hawaii
                                                     , 2000

                                   RE:  S.B. No. 2509
                                        S.D. 1




Honorable Norman Mizuguchi
President of the Senate
Twentieth State Legislature
Regular Session of 2000
State of Hawaii

Sir:

     Your Committees on Government Operations and Housing and
Labor and Environment, to which was referred S.B. No. 2509
entitled: 

     "A BILL FOR AN ACT RELATING TO PROCUREMENT PRACTICES,"

beg leave to report as follows:

     The purpose of this measure is to protect the employees of
vendors who are awarded state contracts by requiring these
contractors to pay the prevailing industry standard wage plus the
costs of applicable fringe benefits to employees.  The measure
requires the department of labor and industrial relations to set
the prevailing wage by using an objective standard of
predominance or currency for jobs in Hawaii.

     Oral testimony in support of this measure was received from
an individual.  Testimony in opposition of this measure was
received from the Hawaii Business League.  The Department of
Labor and Industrial Relations supports the intent of this
measure.  The Department of Accounting and General Services
recommended placement of this measure in section 103-55, Hawaii
Revised Statutes.  Comments were received from the Building
Industry Association of Hawaii.

     Your Committees have amended this measure to further clarify
fringe benefits, and to set the prevailing wage at the rate of an
applicable collective bargaining agreement or union scale, or at
one hundred twenty-five percent of the U.S. Department of Labor
Employment Standards Administration wage and hour determination

 
a                                                     SB2509 SD1
                                   STAND. COM. REP. NO. 2419
                                   Page 2


under the Service Contract Act.  Your Committees recognize that
this measure will apply to employers awarded government contracts
and provide for greater equity in the bidding process.  This
measure will also discourage the award of contracts to employers
who underbid their competitors by paying their employees
substandard wages.

     Reflecting the intent of this measure, the International
Brotherhood of Electrical Workers as well as the ILWU submitted
testimony on a similar measure that provides twelve days of paid
sick leave and ten additional days of unpaid leave, annually.
Therefore, your Committees have decided to move this measure
forward for further discussion.

     As affirmed by the records of votes of the members of your
Committees on Government Operations and Housing and Labor and
Environment that are attached to this report, your Committees are
in accord with the intent and purpose of S.B. No. 2509, as
amended herein, and recommend that it pass Second Reading in the
form attached hereto as S.B. No. 2509, S.D. 1, and be referred to
the Committee on Ways and Means.

                                   Respectfully submitted on
                                   behalf of the members of the
                                   Committees on Government
                                   Operations and Housing and
                                   Labor and Environment,



____________________________       ______________________________
BOB NAKATA, Chair                  ROD TAM, Chair

 
a                                                     SB2509 SD1