Honorable Robert Bunda

President of the Senate

Twenty-Third State Legislature

Regular Session of 2005

State of Hawaii

Sir:

Your Committee on Labor, to which was referred S.B. No. 424 entitled:

begs leave to report as follows:

The purpose of this measure is to prohibit weekly unemployment benefit payments from being reduced by pension payments received under the Social Security Act or the Railroad Retirement Act of 1974.

Testimony in support of this measure was submitted by the Department of Labor and Industrial Relations and the Hawaii State Teachers Association.

Your Committee finds that under the current law, pension benefits are deducted from an individual's unemployment insurance weekly benefit amount based upon the amount the employee contributed to the pension plan. Therefore, if the employee has made a zero to forty-nine percent contribution to the pension plan, then one hundred percent of the pension benefit is deducted; if the employee has made a fifty to ninety-nine percent contribution to the pension plan, then fifty percent of the pension benefit is deducted; and if the employee has made a one hundred percent contribution to the pension plan, there is no deduction.

In Hawaii, the age of the workforce is increasing. Many retired individuals return to the workforce due to economic reasons or due to a need for knowledgeable and skilled workers that cannot otherwise be fulfilled. In either situation, your Committee determines that these individuals should not be penalized when they are collecting Social Security benefits earned after years of work and contributions.

Accordingly, in order to ensure that the intent of the measure is appropriately accomplished, your Committee has amended the measure by:

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. 424, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 424, S.D. 1, and be referred to the Committee on Ways and Means.