STAND. COM. REP. NO. 187
Honolulu, Hawaii
, 2005
RE: H.B. No. 629
Honorable Calvin K.Y. Say
Speaker, House of Representatives
Twenty-Third State Legislature
Regular Session of 2005
State of Hawaii
Sir:
Your Committee on Labor & Public Employment, to which was referred H.B. No. 629 entitled:
"A BILL FOR AN ACT RELATING TO THE EMPLOYEES' RETIREMENT SYSTEM,"
begs leave to report as follows:
The purpose of this bill is to give the Board of Trustees of the Employees' Retirement System (ERS), in specified circumstances, the authority to compromise or settle claims or potential claims for benefits by ERS members who detrimentally rely on erroneous information provided by ERS. A compromise or settlement would only be allowed under the following circumstances:
(1) The claim arises from a written representation made to a member concerning the member's eligibility for ERS benefits;
(2) The representation was made by an authorized ERS employee and was erroneous as to the amount or class of credited service to which the member was entitled;
(3) The member retired or terminated employment or membership in ERS based on a good faith and reasonable reliance on the representation; and
(4) The settlement or compromise would prevent a clear injustice.
The Board of Trustees of ERS, Department of the Attorney General (AG), and Hawaii State Teachers Association testified in support of this bill.
ERS may, on occasion, provide erroneous information to an ERS member relating to retirement or termination of government service. Based on that information, the member may wrongly believe that the member is entitled to benefits that the member is ineligible for. If such an error is discovered only after the member has taken action based on the erroneous information, correction of the error may result in significant adverse consequences to the member.
The AG has opined that it is the Legislature's prerogative to prescribe, by statute, the eligibility requirements for retirement benefits and that the ERS does not, consequently, have the authority to settle cases in which a member detrimentally relied on erroneous information provided by the ERS, if the settlement would result in the receipt of benefits that the member is not entitled to receive, according to statute.
Your Committee finds that these problems can be addressed by allowing ERS, under limited circumstances, to settle or compromise such claims with the approval of the Attorney General, thereby avoiding the costs of achieving resolution through litigation.
As affirmed by the record of votes of the members of your Committee on Labor & Public Employment that is attached to this report, your Committee concurs with the intent and purpose of H.B. No. 629 and recommends that it pass Second Reading and be referred to the Committee on Judiciary.
Respectfully submitted on behalf of the members of the Committee on Labor & Public Employment,
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____________________________ KIRK CALDWELL, Chair |
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