Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Second State Legislature

Regular Session of 2004

State of Hawaii

Sir:

Your Committee on Finance, to which was referred H.B. No. 2657, H.D. 1, entitled:

begs leave to report as follows:

The purpose of this bill is to authorize the voluntary arbitration of disputes in workers' compensation cases under the Uniform Arbitration Act, chapter 658A, Hawaii Revised Statutes (HRS).

The Hawaii Employers' Mutual Insurance Company, Inc., testified in support of this bill. The Chamber of Commerce of Hawaii supported the intent of this measure. The Department of Labor and Industrial Relations, Department of Human Resources Development, ILWU, Local 142, Hawaii State AFL-CIO, and a concerned individual opposed this measure as currently written. Hawaii Government Employees Association provided testimony in opposition.

Your Committee has amended this bill by replacing its substance with language that provides for the arbitration of all workers' compensation disputes under a policy negotiated between an employer and union. Technical, nonsubstantive amendments were also made for clarity, consistency, and style.

Since arbitration is a recognized dispute resolution procedure in collective bargaining, it offers a meaningful alternative to the administrative process currently established under chapter 386, HRS. In most agreements, the cost of arbitrating a dispute is paid for equally by the parties. Arbitration promotes stable relations and your Committee believes claims arising under chapter 386, HRS may be expeditiously resolved through such an established process and procedure.

As affirmed by the record of votes of the members of your Committee on Finance that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 2657, H.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as H.B. No. 2657, H.D. 2