HB2478

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

"§386- Alternative dispute resolution. (a) In lieu of a hearing before the director, within ten days after a claim for compensation is made, either party may decide to have any controversy arising under this chapter be decided by a referee paid for by the parties, provided that written notice is provided to the other party in a timely manner.

(b) Before a referee may conduct a hearing, the parties shall submit the agreed upon referee's name to the director for appointment to serve as a referee. The referee shall be a neutral person. An individual who has a known, direct, and material interest in the outcome of the controversy or a known, existing, and substantial relationship with a party may not serve as a referee, unless that interest is disclosed and any conflict is waived by the parties.

(c) Unless the parties otherwise agree, the costs and fees of the alternative resolution process shall be divided equally between the parties.

(d) If the parties agree to have any controversy referred to a referee, the director shall stay all actions or proceedings until the referee issues a recommended decision.

(e) This chapter and its rules remain applicable to proceedings before the referee, except that requests shall be directed to and recommended decisions shall be made by the referee instead of the director.

(f) The referee shall issue and submit a recommended decision to the director no later than five days after the hearing and shall deliver the recommended decision to all parties personally or by registered or certified mail.

(g) The director shall review the referee's recommended decision to determine whether the recommended decision is in compliance with this chapter.

If the recommended decision is in compliance with this chapter, the director shall approve the recommended decision within ten days of receiving the recommendation. Upon the director's approval, the recommended decision shall have the same force and effect as a director's decision rendered under this chapter, and it may be enforced as if it had been rendered in an action before the director. If the recommended decision does not comply with this chapter, the director may modify or vacate the recommended decision within ten days of receiving the recommendation. If the director vacates the recommended decision, the parties may resubmit the controversy to the referee.

(h) The parties may appeal the director's decision in accordance with section 386-87.

(i) This chapter and Hawaii administrative rules title 12, chapters 10, 14, and 15 shall govern the proceedings before the referee.

(j) Unless otherwise provided in the agreement to mediate, the costs and fees of mediation shall be divided equally between the parties."

SECTION 2. This Act shall not apply to any claim pending on its effective date.

SECTION 3. New statutory material is underscored.

SECTION 4. This Act shall take effect on July 1, 2008.

INTRODUCED BY:	_____________________________

HOUSE OF REPRESENTATIVES	H.B. NO.	2478
TWENTY-FOURTH LEGISLATURE, 2008
STATE OF HAWAII