Gives state and county agencies the discretion to determine whether it is in the public's interest to allow a private contractor to provide necessary services. Restores the right to strike for all collective bargaining units except firefighters and police officers. Repeals references to essential employees and essential positions. (SB1096 HD1)

A BILL FOR AN ACT

SECTION 1. The purpose of this Act is to make government more efficient and economical by:

SECTION 2. The Hawaii Revised Statutes is amended by adding a new chapter to be appropriately designated and to read as follows:

"CHAPTER

§ -1 Scope and application. This chapter is intended to preempt and supersede all other state law with regard to determining whether services, including services obtained in conjunction with the procurement of goods and construction, funded by the State or any of its counties should be provided exclusively by government or obtained through government contracts from the private sector. After this determination is made pursuant to this chapter, procurement laws shall be applied, as appropriate, if an agency determines that a service should be obtained by contract from the private sector.

§ -2 Definitions. For purposes of this chapter, "private entity" means any individual, company, or organization that is not an employee or agency within the federal, state, or county government.

§ -3 Standards for determination. (a) Nothing, including chapters 46, 76, 77, and 89 or other applicable civil service law, and customary or historical past practices, shall be deemed to prevent, restrict, diminish, condition, limit, or otherwise qualify the authority of the State or a county to enter into a contract with a private entity for the provision of services, including services provided in conjunction with the procurement of goods or construction, that customarily or historically may have been performed by persons or positions in the civil service, or functionally attributed to a government agency or program.

(b) Notwithstanding any law to the contrary, including chapters 46, 76, 77, and 89, any state or county official in whom appropriate authority is vested by law shall be allowed to enter into a contract with a private entity financed by public funds, to obtain services, including services provided in conjunction with the procurement of goods or construction, from a private entity, when there is a reasonable basis to believe that the service can be provided at lower costs and is equivalent to or of better quality than that which could be provided by a government agency.

(c) In making the determination pursuant to this section, a state or county official shall consider whether contracting with the private entity will jeopardize the government's ability to provide the service in the event that the private entity fails to perform, or the contract becomes unprofitable or impossible for a private entity to perform.

§ -4 Displaced employees. The State and each of the counties may use the layoff provisions of the civil service laws and the respective collective bargaining contracts to release employees displaced from their positions. Prior to implementing any layoff provision of the civil service laws or a collective bargaining contract, the State and each of the counties shall use their resources for placing, retraining, and providing voluntary severance incentives for displaced employees. Methods that may be used to minimize or avoid the adverse effects of an agency's decision to secure needed services from contractors may include:

SECTION 3. The authorization to contract, conferred upon state and county agencies by the provisions of the chapter added to the Hawaii Revised Statutes by section 2 of this Act may be invoked as authorization for a contract in effect on the effective date of this Act, notwithstanding any provision of Act 230, Session Laws of Hawaii 1998, or any other law conditioning the continued effectiveness of a contract entered into before the effective date of this Act. Any contract existing on the effective date of this Act that does not qualify for the authorization conferred by the provisions of the chapter added to the Hawaii Revised Statutes by section 2 of this Act shall be terminated as soon as its provisions permit the State or county to terminate the contract without adverse consequence.

SECTION 4. Section 89-11, Hawaii Revised Statutes, is amended by amending subsection (d) to read as follows:

"(d) If a dispute between a public employer and the exclusive representative of [appropriate bargaining unit (2), supervisory employees in blue collar positions; appropriate bargaining unit (3), nonsupervisory employees in white collar positions; appropriate bargaining unit (4), supervisory employees in white collar positions; appropriate bargaining unit (6), educational officers and other personnel of the department of education under the same salary schedule; appropriate bargaining unit (8), personnel of the University of Hawaii and the community college system, other than faculty; optional appropriate bargaining unit (9), registered professional nurses; optional appropriate bargaining unit (10), institutional, health, and correctional workers;] optional appropriate bargaining unit (11), firefighters[;], or optional appropriate bargaining unit (12), police officers[; or optional appropriate bargaining unit (13), professional and scientific employees, other than registered professional nurses], exists over the terms of an initial or renewed agreement more than ninety working days after written notification by either party to initiate negotiations, either party may give written notice to the board that an impasse exists and the board shall assist in the voluntary resolution of the impasse by appointing a mediator within three days after the date of impasse. If the dispute continues to exist fifteen working days after the date of impasse, the dispute shall be submitted to arbitration proceedings as provided herein.

The board shall immediately determine whether the parties to the dispute have mutually agreed upon an arbitration procedure and whether the parties have agreed upon a person or persons whom the parties desire to be appointed as the arbitrator or as a panel of arbitrators, as the case may be.

If the board determines that an arbitration procedure mutually agreed upon by the parties will result in a final and binding decision, and that an arbitrator or arbitration panel has been mutually agreed upon, it shall appoint such arbitrator or arbitration panel and permit the parties to proceed with the arbitration procedure mutually agreed upon.

If, after eighteen working days from the date of impasse, the parties have not mutually agreed upon an arbitration procedure and an arbitrator or arbitration panel, the board shall immediately notify the employer and the exclusive representative that the issues in dispute shall be submitted to a three-member arbitration panel who shall follow the arbitration procedure provided herein.

Within twenty-one working days from the date of impasse, two members of the arbitration panel shall be selected by the parties; one shall be selected by the employer and one shall be selected by the exclusive representative. The impartial third member of the arbitration panel shall be selected by the two previously selected panel members and shall chair the arbitration panel.

In the event that the two previously selected arbitration panel members fail to select an impartial third arbitrator within twenty-four working days from the date of impasse, the board shall request the American Arbitration Association, or its successor in function, to furnish a list of five qualified arbitrators from which the impartial arbitrator shall be selected. Within five calendar days after receipt of such list, the parties shall alternately strike names therefrom until a single name is left, who shall be immediately appointed by the board as the impartial arbitrator and chairperson of the arbitration panel.

Upon the selection and appointment of the arbitration panel, each party shall submit to the panel, in writing, with copy to the other party, a final offer which shall include all provisions in any existing collective bargaining agreement not being modified, all provisions already agreed to in negotiations, and all further provisions other than those relating to contributions by the State and respective counties to the Hawaii public employees health fund which each party is proposing for inclusion in the final agreement.

Within twenty calendar days of its appointment, the arbitration panel shall commence a hearing at which time the parties may submit either in writing or through oral testimony, all information or data supporting their respective final offers. Nothing in this section shall be construed to prohibit the parties from reaching a voluntary settlement on the unresolved issues, with or without the assistance of a mediator, at any time prior to the conclusion of the hearing conducted by the arbitration panel.

Within thirty calendar days after the conclusion of the hearing, a majority of the arbitration panel shall issue a final and binding decision.

In reaching a decision, the arbitration panel shall give weight to the factors listed below and shall include in a written opinion an explanation of how the factors were taken into account in reaching the decision:

The decision of the arbitration panel shall be final and binding upon the parties on all provisions submitted to the arbitration panel. If the parties have reached agreement with respect to the amounts of contributions by the State and counties to the Hawaii public employees health fund by the tenth working day after the arbitration panel issues its decision, the final and binding agreement of the parties on all provisions shall consist of the panel's decision and the amounts of contributions agreed to by the parties. If the parties have not reached agreement with respect to the amounts of contributions by the State and counties to the Hawaii public employees health fund by the close of business on the tenth working day after the arbitration panel issues its decision, the parties shall have five days to submit their respective recommendations for such contributions to the legislature, if it is in session, and if the legislature is not in session, the parties shall submit their respective recommendations for such contributions to the legislature during the next session of the legislature. In such event, the final and binding agreement of the parties on all provisions shall consist of the panel's decision and the amounts of contributions established by the legislature by enactment, after the legislature has considered the recommendations for such contributions by the parties. It is strictly understood that no member of a bargaining unit subject to this subsection shall be allowed to participate in a strike on the issue of the amounts of contributions by the State and counties to the Hawaii public employees health fund. The parties shall take whatever action is necessary to carry out and effectuate the final and binding agreement. The parties may, at any time and by mutual agreement, amend or modify the panel's decision.

Agreements reached pursuant to the decision of an arbitration panel and the amounts of contributions by the State and counties to the Hawaii public employees health fund, as provided herein, shall not be subject to ratification by the employees concerned. All items requiring any moneys for implementation shall be subject to appropriations by the appropriate legislative bodies and the employer shall submit all such items within ten days after the date on which the agreement is entered into as provided herein, to the appropriate legislative bodies.

The costs for mediation shall be borne by the board. All other costs incurred by either party in complying with these provisions, including the costs of its selected member on the arbitration panel, shall be borne by the party incurring them, except that all costs and expenses of the impartial arbitrator shall be borne equally by the parties."

SECTION 5. Section 89-12, Hawaii Revised Statutes, is amended to read as follows:

"§89-12 Strikes, rights and prohibitions. (a) Participation in a strike shall be unlawful for any employee who (1) is not included in an appropriate bargaining unit for which an exclusive representative has been certified by the board, or (2) is included in an appropriate bargaining unit for which process for resolution of a dispute is by referral to final and binding arbitration[, or (3) is an essential employee].

(b) It shall be lawful for an employee, who is not prohibited from striking under paragraph (a) and who is in the appropriate bargaining unit involved in an impasse, to participate in a strike after (1) the requirements of section 89-11 relating to the resolution of disputes have been complied with in good faith, (2) the proceedings for the prevention of any prohibited practices have been exhausted, (3) sixty days have elapsed since the fact-finding board has made public its findings and any recommendation, (4) the exclusive representative has given a ten-day notice of intent to strike to the board and to the employer.

[(d)] (c) No employee organization shall declare or authorize a strike of employees, which is or would be in violation of this section. Where it is alleged by the public employer that an employee organization has declared or authorized a strike of employees which is or would be in violation of this section, the public employer may apply to the board for a declaration that the strike is or would be unlawful and the board, after affording an opportunity to the employee organization to be heard on the application, may make such a declaration.

[(e)] (d) If any employee organization or any employee is violating or failing to comply with the requirements of this section, or if there is reasonable cause to believe that an employee organization or an employee will violate or fail to comply with such requirements, the public employer affected shall, forthwith, institute appropriate proceedings in the circuit in which the violation occurs to enjoin the performance of any acts or practices forbidden by this section, or to require the employee organization or employees to comply with the requirements of this section. Jurisdiction to hear and dispose of all actions under this section is conferred upon each circuit court, and each court may issue in compliance with chapter 380, such orders and decrees, by way of injunction, mandatory injunction, or otherwise, as may be appropriate to enforce this section. The right to a jury trial shall not apply to any proceeding brought under this section."

SECTION 6. Section 89-2, Hawaii Revised Statutes, is amended by deleting the definitions of "essential employee" and "essential position".

[""Essential employee" means an employee designated by the public employer to fill an essential position.

"Essential position" means any position designated by the board as necessary to be worked in order to avoid or remove any imminent or present danger to the public health or safety, which position shall be filled by the public employer."]

SECTION 7. Act 253, Session Laws of Hawaii 2000, section 93, is amended by deleting the definitions of "essential employee" and "essential position" in section 89-2, Hawaii Revised Statutes.

[""Essential employee" means an employee designated by the public employer to fill an essential position.

"Essential position" means any position designated by the board as necessary to be worked in order to avoid or remove any imminent or present danger to the public health or safety, which position shall be filled by the public employer."]

SECTION 8. Act 253, Session Laws of Hawaii 2000, section 100, is amended by amending subsection (e) of section 89-11, Hawaii Revised Statutes, to read as follows:

"(e) If an impasse exists between a public employer and the exclusive representative of bargaining unit [(2), supervisory employees in blue collar positions; bargaining unit (3), nonsupervisory employees in white collar positions; bargaining unit (4), supervisory employees in white collar positions; bargaining unit (6), educational officers and other personnel of the department of education under the same salary schedule; bargaining unit (8), personnel of the University of Hawaii and the community college system, other than faculty; bargaining unit (9), registered professional nurses; bargaining unit (10), institutional, health, and correctional workers; bargaining unit] (11), firefighters[;], or bargaining unit (12), police officers[; or bargaining unit (13), professional and scientific employees], the board shall assist in the resolution of the impasse as follows:

SECTION 9. Act 253, Session Laws of Hawaii 2000, section 101, is amended by amending subsection (a) of section 89-12, Hawaii Revised Statutes, to read as follows:

"(a) It shall be unlawful for any employee to participate in a strike if the employee:

PART III

SECTION 10. If any provision of this Act or the application thereof to any person or circumstance is held invalid, the invalidity does not affect other provisions or applications of the Act which can be given effect without the invalid provision or application, and to this end the provisions of this Act are severable.

SECTION 11. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 12. This Act shall take effect on July 1, 2001; provided that part I shall be repealed on June 30, 2005.