WHEREAS, the Department of Human Services contracts with social care providers, including corporations and private agencies, to perform attendant care and day care services authorized under the Social Security Act, as amended; and

WHEREAS, under these Department of Human Services contracts, the social care providers are the recipients of social service payments; and

WHEREAS, sections 386-1, 392-3, and 393-5, Hawaii Revised Statutes, exclude "domestic" services from the definition of "employment" under each respective chapter for individuals who perform attendant care and day care services authorized under the Social Security Act, as amended, in the employ of persons, including corporations and private agencies, that contract with Department of Human Services to provide these services and who are the recipients of social service payments; and

WHEREAS, in enacting these "domestic" exemptions, the Legislature of the State of Hawaii found in 1978 that: "if the specific exemptions to the State's wage loss replacement and employment insurance programs are not adopted, the attendant care-chore services and in-home child care service payments must be adjusted to include the recipient/employer's contribution to the following programs: State Unemployment Insurance Benefits (UIB), State Worker's Compensation (WC), State Temporary Disability Insurance (TDI), and Prepaid Health Insurance (PPHI)"; and

WHEREAS, the Legislature intended the "domestic" exemption to be included in the Hawaii Employment Security Law, chapter 383, Hawaii Revised Statutes; and

WHEREAS, the State of Hawaii does not wish to, and it was the intent of the Legislature not to, increase the social service payments to these social care providers, including corporations and private agencies, by requiring the providers to make contributions to state unemployment insurance benefits, state workers' compensation, state temporary disability insurance, and prepaid health care insurance on behalf of individuals who perform attendant care and day care services authorized under the Social Security Act, as amended, in the employ of these providers; and

WHEREAS, the Legislature wishes to clarify its intent that, these social care providers, including corporations and private agencies, as recipients of social service payments under their contracts with the Department of Human Services, and the individuals who perform attendant care and day care services authorized under the Social Security Act, as amended, in the employ of these providers, are exempt under the Hawaii Employment Security Law, Workers' Compensation Law, the Temporary Disability Law, and the Prepaid Health Care Law; and

WHEREAS, the Legislature finds that it is in the public interest, benefit, and welfare to have a friendly regulatory environment for business, including consistent employment benefit laws, and that it is contrary to the public interest, benefit, and welfare to have inconsistent laws that exclude the "domestic" exemption in the Hawaii Workers' Compensation Law, Temporary Disability Law, and Prepaid Health Care Law; and

WHEREAS, the Legislature has been informed that the Department of Labor and Industrial Relations and other state agencies are currently taking action to enforce provisions of chapters 383, 386, 392, and 393, Hawaii Revised Statutes, regarding insurance, withholdings, payments, and all similar requirements, on the persons, including corporations and private agencies, contracting with Department of Human Services to provide attendant care and day care services authorized under the Social Security Act, as amended, as those laws relate to individuals who perform attendant care and day care services authorized under the Social Security Act in the employ of these persons; and

WHEREAS, the Legislature finds that these actions by the Department of Labor and Industrial Relations and other state agencies may jeopardize and seriously impair the ability of social care providers to operate and use their resources to provide services to elderly and disabled adults in Hawaii; and

WHEREAS, the Legislature finds that it is in the public interest, benefit, and welfare to ensure that social care providers continue to operate and use their resources to provide services to elderly and disabled adults in Hawaii; now, therefore,

BE IT RESOLVED by the House of Representatives of the Twenty-third Legislature of the State of Hawaii, Regular Session of 2006, that this body clarifies and declares its intention to treat all social care providers, including corporations and private agencies, who contract with the Department of Human Services to perform attendant care and day care services authorized by the Department of Human Services under the Social Security Act, as amended, as recipients of social service payments described in the "domestic" exemptions under the relevant sections of the Hawaii Workers' Compensation Law, Temporary Disability Law, and Prepaid Health Care Law, and that all individuals who perform attendant care and day care services authorized under the Social Security Act, as amended, in the employ of care providers, are exempt from the coverage of these state laws; and

BE IT FURTHER RESOLVED that the Legislature clarifies and declares its intention that all social care providers, including corporations and private agencies, who contract with the Department of Human Services to perform attendant care and day care services authorized under the Social Security Act, as amended, as recipients of social service payments, be covered by a "domestic" exemption that should have been included in the Hawaii Employment Security Law and all individuals who perform attendant care and day care services authorized under the Social Security Act, as amended, in the employ of care providers, be exempt from the definition of "employment" under chapter 383, Hawaii Revised Statutes; and

BE IT FURTHER RESOLVED that the Attorney General, as the State's legal representative and chief legal officer, is requested to provide a definitive legal opinion forthwith, regarding whether sections 386-1, 392-3, and 393-5, Hawaii Revised Statutes, exclude from the definitions of "employment" those individuals who perform attendant care and day care services authorized under the Social Security Act, as amended, in the employ of persons, including corporations and private agencies, who contract with the Department of Human Services to provide care services and who are the recipients of social service payments; and

BE IT FURTHER RESOLVED that the Attorney General, as the State's legal representative and chief legal officer, is requested to provide the Legislature with a definitive legal opinion forthwith, regarding whether chapter 383, Hawaii Revised Statutes, excludes from its definition of "employment" those individuals who perform attendant care and day care services authorized under the Social Security Act, as amended, in the employ of persons, including corporations and private agencies, who contract with the Department of Human Services to provide these services and who are the recipients of social service payments; and

BE IT FURTHER RESOLVED that if the Attorney General opines that these individuals are not already excluded from the definition of "employment" in chapters 383, 386, 392, and 393, Hawaii Revised Statutes, the Attorney General is requested to provide the Legislature with proposed legislation that will retroactively and prospectively exclude from the definition of "employment" in chapters 383, 386, 392, and 393, Hawaii Revised Statutes, those individuals who perform attendant care and day care services authorized under the Social Security Act, as amended, in the employ of persons, including corporations and private agencies, who contract with the Department of Human Services to provide these care services; and

BE IT FURTHER RESOLVED that to provide the Legislature with an opportunity to act upon the Attorney General's recommendations or proposed legislation, or both, and to ensure that social care providers continue to operate and use their resources to provide services to elderly and disabled adults in Hawaii, the Legislature requests that the Attorney General, Department of Labor and Industrial Relations, Department of Taxation, and other state agencies and private entities suspend, until June 30, 2007, all application and enforcement of the relevant provisions of chapters 383, 386, 392, and 393, Hawaii Revised Statutes, regarding insurance, withholdings, payments, and all similar requirements on persons, including corporations and private agencies, who contract with the Department of Human Services to provide attendant care and day care services authorized under the Social Security Act, as amended, as these laws relate to individuals who perform attendant care and day care services authorized under the Social Security Act, as amended, in the employ of these persons; and

BE IT FURTHER RESOLVED that the Director of Human Services, upon receipt of the Attorney General's opinions requested under this Resolution, is requested to notify all affected persons, including corporations and private agencies, who contract with the Department of Human Services to provide attendant care and day care services authorized under the Social Security Act, as amended; and

BE IT FURTHER RESOLVED that the Attorney General is requested to submit the opinions requested under this Resolution to the Legislature and to the Director of Human Services as soon as possible; and

BE IT FURTHER RESOLVED that the Attorney General is requested to submit to the Legislature, not later than twenty days prior to the convening of the 2007 Regular Session, any proposed legislation to effectuate the exemption of persons, including corporations and private agencies, who contract with the Department of Human Services to provide attendant care and day care services authorized under the Social Security Act, as amended, from chapter 383, Hawaii Revised Statutes, and any other laws identified in this Resolution as may be necessary; and

BE IT FURTHER RESOLVED that certified copies of this Resolution be transmitted to the Governor, the Director of Human Services, the Director of Taxation, the Director of Labor and Industrial Relations, and the Hawaii Employers Mutual Insurance Company.

Report Title:

AG; Exclusion of Domestic Services; Employment Security Law