Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-First State Legislature

Regular Session of 2001

State of Hawaii

Sir:

Your Committee on Labor and Public Employment, to which was referred H.B. No. 355 entitled:

begs leave to report as follows:

The purpose of this measure is to expand the exclusion for workers' compensation stress claims.

The bill accomplishes this by excluding workers' compensation claims for physical and mental injury resulting from disciplinary action or other personnel action when the employer acted in good faith.

Presently, the law excludes employees' claims for mental stress only if the injury resulted solely from disciplinary action when the employer acted in good faith or in accordance with a collective bargaining agreement.

Upon further consideration, your Committee has amended this measure to accomplish substantially the same goals but in a less sweeping manner:

Specifically this measure reduces the cost of workers' compensation by:

In excluding claims stemming from all personnel actions, the measure excludes workers' compensation claims based not only upon disciplinary actions, but also those based upon necessary and legitimate actions such as job performance reviews, position reclassifications, promotions, or downsizing. Workers' compensation claims for any mental stress would be prohibited if the employer acted in good faith, although this would not affect the employee's right to challenge the personnel action.

Unlike this bill as introduced, however, this bill retains the present provision of law that allows collective bargaining or other employment agreements controlling if they specify a standard other than good faith for disciplinary actions. Your Committee finds that these agreements negotiated between employers and employees should be honored and not overridden by statutory fiat.

Your Committee also made a few technical nonsubstantive corrections.

As affirmed by the record of votes of the members of your Committee on Labor and Public Employment that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 355, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 355, H.D. 1, and be referred to the Committee on Consumer Protection and Commerce.