Honorable Robert Bunda

President of the Senate

Twenty-Third State Legislature

Regular Session of 2006

State of Hawaii

Sir:

Your Committee on Labor, to which was referred S.B. No. 2208 entitled:

begs leave to report as follows:

The purpose of this measure is to require a private employer who provides a pension plan to employees to allow an employee who has vested in the pension plan to receive pension payments upon becoming disabled, regardless of age.

Testimony in support of this measure was submitted by two individuals. Testimony in opposition to this measure was submitted by the Society for Human Resource Management – Hawaii Chapter.

Your Committee finds that an employee who has not yet reached the age of retirement, but becomes physically or mentally disabled, is left with few options for economic survival. The disabled employee will most likely cease working and is forced to find the means for financial and medical support. Your Committee believes that if the disabled employee has become vested in the employer's pension plan, that the disabled employee should be allowed to immediately receive a pension, regardless of the disabled employee's age. This benefit will provide financial support to the disabled employee and ensure that the disabled employee will not unnecessarily drain the state's resources.

Your Committee understands that there are concerns regarding the preemption of this measure by the Employee Retirement Income Security Act of 1974, as amended. Accordingly, your Committee has requested an opinion on the matter from the Attorney General to ascertain the propriety of the proposed law or how the intent of the measure might be otherwise accomplished. Thus, your Committee believes that this measure should continue to progress throughout the session as these issues continue to be explored.

As affirmed by the record of votes of the members of your Committee on Labor that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 2208 and recommends that it pass Second Reading and be referred to the Committee on Commerce, Consumer Protection, and Housing.