STAND. COM. REP. NO. 563

Honolulu, Hawaii

RE:    S.B. No. 1076

       S.D. 1

Honorable Shan S. Tsutsui

President of the Senate

Twenty-Sixth State Legislature

Regular Session of 2011

State of Hawaii

Sir:

     Your Committee on Judiciary and Labor, to which was referred S.B. No. 1076 entitled:

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

begs leave to report as follows:

     The purpose and intent of this measure is to make it an unlawful practice for any employer or labor organization to bar or discharge from employment, withhold pay from, or demote an employee solely because the employee uses accrued and available sick leave.

     Your Committee received testimony in support of this measure from the Hawaii Laborers' Union, the International Brotherhood of Electrical Workers, and the Hawaii State AFL-CIO.  Your Committee received testimony in opposition to this measure from Hawaiian Electric Company, Inc., and its subsidiaries Hawaii Electric Light Company, Inc., and Maui Electric Company, Limited; First Hawaiian Bank; Hawaiian Telcom; Hawaii Credit Union League; and one individual.  Your Committee received comments on this measure from the Department of Labor and Industrial Relations.

     Your Committee finds that this measure is intended to protect employees who legitimately use accrued and available sick leave benefits from being harassed, intimidated, suspended, terminated, or penalized.  As noted by The Chamber of Commerce of Hawaii in oral testimony to your Committee, sick leave is an entitlement.  Promising sick leave benefits to an employee as part of an employment package and then penalizing the employee for using those benefits is incongruous and in essence creates a bait-and-switch situation for the employee.

     Your Committee notes, however, that there are concerns from employers that employees may abuse sick leave policies, essentially making sick leave paid vacation time.  Under this measure, an employer would be unable to discipline employees who misuse their sick leave.  In 2010, the Legislature considered and passed a similar measure, S.B. No. 2883, C.D. 1 (2010), which was vetoed by the Governor.  S.B. No. 2883, C.D. 1, struck a balance between ensuring that employees could use the sick leave benefits promised by their employers and the ability of employers to protect themselves from employees' misuse of those benefits.

     Accordingly, your Committee has amended this measure by:

     (1)  Revising the amendment to section 378-32(b) by clarifying that it is unlawful to punish an employee who legitimately uses a negotiated sick leave policy;

     (2)  Including provisions from S.B. No. 2883, C.D. 1 (2010), which provides exemptions to employers and labor organizations regarding unlawful practices, as described in this measure, under circumstances in which an employee abuses the use of sick leave or is unable to fulfill the essential job functions or requirements of the employee's position;

     (3)  Inserting an effective date of July 1, 2050, to allow for further discussion; and

     (4)  Making technical, nonsubstantive amendments for the purposes of clarity and consistency.

     As affirmed by the record of votes of the members of your Committee on Judiciary and Labor that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 1076, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 1076, S.D. 1, and be placed on the calendar for Third Reading.

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

____________________________

CLAYTON HEE, Chair