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. 3035 entitled:

begs leave to report as follows:

The purpose of this measure is to prevent an employer who believes that an injured employee is able to return to work, but who has yet to return to work, from terminating the employee's temporary total disability benefits until a decision is rendered by the director of labor and industrial relations.

Testimony in support of this measure was submitted by the Hawaii Government Employees Association, AFSCME Local 152, AFL-CIO; the Hawaii State AFL-CIO; the IBEW Local 1537; the IBEW Local 1260; the IBEW Local 1186; the ILWU Local 142; the Hawaii State Teachers Association; the Hawaii Chapter – American Physical Therapy Association; the Hawaii Injured Workers Alliance; and eight individuals.

Testimony in opposition to this measure was submitted by the Department of Labor and Industrial Relations, the Department of Human Resources Development, the Hawaii Insurers Council, the Hawaii Independent Insurance Agents Association, and the Society for Human Resources Management – Hawaii Chapter. Comments on this measure were also submitted by the Hawaii Employers' Mutual Insurance Company, Inc.

Your Committee finds that, under the current law, an employer may unilaterally terminate an injured employee's temporary total disability (TTD) benefits upon the belief that the injured employee is able to return to work. This termination of benefits can occur irrespective of whether the injured employee has actually resumed work. Once benefits are terminated, the injured employee must make a written request to the director of labor and industrial relations if the termination is contested. Currently, an injured employee who has disputed the termination of TTD benefits must wait three to nine months for a hearing and resolution on the matter. Your Committee further finds that the workers' compensation system balances the interests of employers and employees by guaranteeing that workers injured on the job receive medical treatment and replacement of lost wages, while employees relinquish their right to sue under most circumstances. Therefore, medical treatment and payment of TTD benefits should not be capriciously terminated. Your Committee believes that the termination of TTD benefits under the current law creates an undue hardship on the injured employee when the injured employee is not working and likely has no other means of income.

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. 3035 and recommends that it pass Second Reading and be referred to the Committee on Ways and Means.