Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Second State Legislature

Regular Session of 2004

State of Hawaii

Sir:

Your Committee on Labor and Public Employment, to which was referred H.B. No. 1778 entitled:

begs leave to report as follows:

The purpose of this bill is to amend chapter 388, Hawaii Revised Statutes (HRS), to allow employers to streamline their method of transmitting wage information to their employees. Specifically, this measure authorizes an employer upon receipt of authorization from the employee, and in lieu of a printed, typewritten, or handwritten record, to furnish an employee with an electronic record that details:

The Department of Labor and Industrial Relations (DLIR) and Verizon Hawaii testified in support of this measure. The International Brotherhood of Electrical Workers (IBEW) opposed the measure.

Currently, Hawaii's Wage and Hour Law requires employers to provide a "pay stub" to their employees only in a printed, typewritten, or handwritten form. With the proliferation of electronic communications and prevalence of computers in the workplace, it seems reasonable to have employees receive their wage information in an electronic format. This would also seem a more timely and cost-effective method for employers to transmit wage information to their employees.

However, your Committee understands that it is vital that privacy interests of employees are protected.

Accordingly, your Committee has amended this measure by:

Your Committee notes that concerns were raised by the IBEW regarding the adequacy of "pay stub" information currently provided by some employers. Testimony from the IBEW suggested that employees have difficulty determining the accuracy of overtime wages and other compensation.

Although the Wage and Hour Law does not specifically require employers to provide differential information broken down by specific hours worked, collective bargaining agreements may require employers to provide additional information, including records on the days and hours worked during "off-hours." Furthermore, for larger companies that process their paychecks out-of-state, it is unclear whether the terms of the Wage and Hour Law, as it applies to pay stub information, are being enforced.

Accordingly, your Committee requests that DLIR look into the enforcement of wage information disclosure requirements of collective bargaining agreements, as well as the practices of companies with out-of-state payroll processing operations to determine whether collective bargaining agreements and the Wage and Hour Law are being enforced.

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. 1778, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 1778, H.D. 1, and be referred to the Committee on Finance.