STAND. COM. REP. NO. 147

Honolulu, Hawaii

RE:    S.B. No. 1664

       S.D. 1

Honorable Colleen Hanabusa

President of the Senate

Twenty-Fifth State Legislature

Regular Session of 2009

State of Hawaii

Madam:

     Your Committee on Labor, to which was referred S.B. No. 1664 entitled:

"A BILL FOR AN ACT RELATING TO EMPLOYMENT SECURITY,"

begs leave to report as follows:

     The purpose of this measure is to clarify and temporarily codify implementation of a partial unemployment insurance system and extend the duration of employees' eligibility for unemployment benefits under partial unemployment insurance from four weeks to eight weeks.

     Testimony in support of the measure was submitted by two organizations.

     The Department of Labor and Industrial Relations supported the intent of the measure.

     Your Committee finds that the people currently claiming unemployment benefits from the State also include many who are employed but are working fewer hours than they had previously worked because their employers could not afford to retain them as full-time workers.

     Your Committee also finds that, given the current economic situation, employers may benefit by cutting their employees' hours while continuing to provide certain benefits, rather than laying off employees completely.  In doing so, employers may maintain their employees' loyalty and productivity when the economy recovers and employees are again needed on a full-time basis.

     Your Committee further finds that the Department of Labor and Industrial Relations already implements a partial unemployment insurance system through its administrative rules and has assisted employees during work slowdowns for several businesses in the past.

     Your Committee finds that although this measure differs from the Department of Labor and Industrial Relations' existing administrative rules by extending partial unemployment from four to eight weeks, the Department has extended the period of eligibility for partial unemployment in the past, as the extension is also permitted in its administrative rules.  The Department recommended that the proposed section 383‑B(c), Hawaii Revised Statutes, be eliminated, as the intent and application of that subsection is unclear.

     Your Committee has accordingly amended this measure by:

     (1)  Removing the proposed section 383‑B(c), Hawaii Revised Statutes; and

     (2)  Making technical, nonsubstantive amendments.

     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. 1664, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 1664, S.D. 1, and be referred to the Committee on Ways and Means.

Respectfully submitted on behalf of the members of the Committee on Labor,

____________________________

DWIGHT Y. TAKAMINE, Chair