Report Title:

Workers' Compensation; Labor-Management Agreements

Description:

Requires the State and the courts to recognize the validity of labor-management agreements that meet certain specified requirements. Requires HEMIC to act as an insurer for labor management agreements in certain instances. (HB2646 HD2)

HOUSE OF REPRESENTATIVES

H.B. NO.

2646

TWENTY-THIRD LEGISLATURE, 2006

H.D. 2

STATE OF HAWAII

  

 

A BILL FOR AN ACT

 

RELATING TO WORKERS' COMPENSATION.

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

SECTION 1. Chapter 386, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§386- Labor-management agreements. (a) Except as provided in subsection (b), the director and the courts of this State shall recognize as valid and binding any labor-management agreement within the construction industry providing workers' compensation benefits that meets the following requirements:

(1) The labor-management agreement shall be negotiated separate and apart from any collective bargaining agreement covering affected employees;

(2) The labor-management agreement shall be restricted to the establishment of terms and conditions necessary to implement this section; and

(3) The labor-management agreement shall be negotiated, in accordance with the authorization of the director pursuant to subsection (e), between an employer or groups of employers and a union that is the exclusive bargaining representative and shall establish the following:

(A) An alternative dispute resolution system governing disputes between employees and employers or their insurers that supplements or replaces all or part of dispute resolution processes contained in this chapter, including but not limited to mediation and arbitration. Any system of arbitration shall provide that the decision of the arbitrator or board of arbitration is subject to review by the director. The findings of fact, award, order, or decision of the arbitrator shall have the same force and effect as an award, order, or decision of the director; and

(B) A joint labor-management panel that will select providers, an ombudsman, mediators, and arbitrators. The panel shall include at least one representative from the building trade unions.

(4) In addition to the requirements of paragraph (3), the labor-management agreement may include one or more of the following:

(A) The use of an agreed list of providers of medical treatment that may be the exclusive source of all medical treatment provided under this chapter;

(B) The use of an agreed, limited list of impartial physicians that may be the exclusive list of impartial physicians under this chapter;

(C) Joint labor-management safety committees; and

(D) A vocational rehabilitation or retraining program using an agreed list of providers of rehabilitation services that may be the exclusive source of providers of rehabilitation services under this chapter.

(b) Nothing in this section shall be construed to allow a labor-management agreement authorized by this section to diminish the entitlement of an employee or the employee's beneficiary to compensation payments for death or permanent total disability as otherwise provided in this chapter; nor shall any agreement authorized by this section deny to any employee the right to representation by counsel at all stages during the alternative dispute resolution process. Any portion of any agreement that violates this subsection shall be void.

(c) The parties to a labor-management agreement may negotiate any aspect of the delivery of workers' compensation benefits.

(d) The following entities are authorized to enter into a labor-management agreement pursuant to this section:

(1) An employer who has or estimates as having an annual workers' compensation insurance premium in this state of $20,000 or more;

(2) Trade groups of employers who have or estimate as having an annual workers' compensation insurance premium in this state of $50,000 or more; and

(3) Workers' compensation self-insurance groups that meet the requirements of section 386-194.

(e) Any exclusive bargaining representative may file a petition with the director seeking permission to negotiate with an employer or group of employers to enter into a labor-management agreement pursuant to this section. The petition shall specify the bargaining unit or units to be included, the names of the employers' or workers' compensation self-insurance group, and shall be accompanied by proof of the union's status as the exclusive bargaining representative. The current collective bargaining agreement or agreements shall be attached to the petition. The petition shall be in the form designated by the director. Upon receipt of the petition, the director shall promptly verify the petitioner's status as the exclusive bargaining representative. If the petition satisfies the requirements set forth in this subsection, the director shall issue a letter advising each employer and exclusive bargaining representative of their eligibility to enter into negotiations, for a period not to exceed one year, for the purpose of reaching an agreement on a labor-management agreement pursuant to this section. The parties may jointly request, and shall be granted by the director, an additional one-year period to negotiate an agreement.

(f) No employer may establish or continue a program established under this section until it has provided the director with all of the following:

(1) Upon its original application and whenever it is renegotiated thereafter, a copy of the labor-management agreement and the approximate number of employees who will be covered thereby;

(2) Upon its original application and annually thereafter, a statement, signed under penalty of perjury, that no action has been taken by any administrative agency or court of the United States to invalidate the labor-management agreement;

(3) The name, address, and telephone number of the contact person of the employer; and

(4) Any other information that the director deems necessary to further the purposes of this section.

(g) No collective bargaining representative may establish or continue to participate in a program established under this section unless all of the following requirements are met:

(1) Upon its original application and annually thereafter, it provides to the director a copy of its most recent LM-2 or LM-3 form filed with the United States Department of Labor, where the filing is required by law, along with a statement, signed under penalty of perjury, that the document is a true and correct copy; and

(2) It provides to the director the name, address, and telephone number of each contact person of the collective bargaining representative or representatives.

(h) If a labor-management agreement established pursuant to subsection (a) is not able to procure workers' compensation coverage from an insurer in the voluntary insurance market and is not authorized to self insure, the Hawaii employers' mutual insurance company established pursuant to article 14A of chapter 431 shall serve as the workers' compensation insurer for the labor management-agreement.

(i) Commencing July 1, 2007, and annually thereafter, the director shall report to the legislature the number of labor-management agreements received and the number of employees covered by these agreements. The report based upon aggregate data shall include the following:

(1) Person hours and payroll covered by agreements filed;

(2) The number of claims filed;

(3) The average cost per claim, reported by cost components whenever practicable;

(4) The number of litigated claims, including the number of claims submitted to mediation, the appeals board, or the court of appeal;

(5) The number of contested claims resolved prior to arbitration;

(6) The projected incurred costs and actual costs of claims;

(7) Safety history;

(8) The number of workers participating in vocational rehabilitation; and

(9) Overall worker satisfaction.

The director may require employers' and workers' compensation self-insurance groups participating in labor-management agreements pursuant to this section to provide the data enumerated in this subsection.

(j) The records obtained by the director pursuant to this section shall be confidential and shall not be subject to public disclosure under any law of this State. However, the director shall create derivative reports pursuant to subsections (g) and (i) based on the labor-management agreements and records, which shall be subject to disclosure pursuant to chapter 92F. On a monthly basis, the director shall make available an updated list of employers and unions entering into labor-management agreements authorized by this section.

(k) For the purposes of this section, "construction industry" means the industry where any person who by oneself or through others offers to undertake, or holds oneself out as being able to undertake, or does undertake to alter, add to, subtract from, improve, enhance, or beautify any realty or construct, alter, repair, add to, subtract from, improve, move, wreck, or demolish any building, highway, road, railroad, excavation, or other structure, project, development, or improvement, or do any part thereof, including the erection of scaffolding or other structures or works in connection therewith."

SECTION 2. New statutory material is underscored.

SECTION 3. This Act shall take effect on July 1, 2096, shall apply retroactively to January 1, 2006, and shall be repealed on December 31, 2008; provided that any labor-management agreement executed pursuant to this Act prior to December 31, 2008, shall remain in full force and effect until the expiration of the labor-management agreement.