HOUSE OF REPRESENTATIVES	H.B. NO.	59
TWENTY-SEVENTH LEGISLATURE, 2013
STATE OF HAWAII

A BILL FOR AN ACT

relating to wages.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

     SECTION 1.  Wage theft, which consists of pay-related violations committed by employers, such as the failure to pay wage earners the required minimum wages or overtime, impacts employees throughout the United States.  Many states are addressing this issue by creating laws to better protect wage earners' rights.  New York, for example, recently passed the Wage Theft Prevention Act, which amended that state's notice of wage rate requirements and expanded criminal and civil remedies.

     The legislature finds that Hawaii is one of several states that have agreed to work with the United States Department of Labor to share information in an effort to deal with the wage theft problem.

     The purpose of this Act is to protect employees in this State by requiring employers to provide employees with specific wage information at the time of hiring and on pay statements and to expand the criminal and civil penalties available for enforcement purposes.

     SECTION 2.  Chapter 387, Hawaii Revised Statutes, is amended by adding a new section to read as follows:

     "§387-   Public notice of employer violations. (a)  If an employer violates any provision this chapter, the director may post or affix or both, for a period not to exceed one year, a notice not less than eight and one-half by eleven inches in an area visible to the employer's employees summarizing the violations and other information deemed pertinent by the director, in the form and manner ordered by the director.

(b)  If the employer's violation is a wilful failure to pay all wages as required by this chapter, the director may post or affix or both, for a period not to exceed ninety days, in an area visible to the general public, as ordered by the director, a notice not less than eight and one-half by eleven inches summarizing the violations, in the form and manner ordered by the director.

(c)  Any person other than the director or the director's duly authorized representative who removes, alters, defaces, or otherwise interferes with a notice posted or affixed under this section shall be guilty of a misdemeanor."

     SECTION 3.  Chapter 388, Hawaii Revised Statutes, is amended by adding a new section to read as follows:

     "§388-   Public notice of employer violations. (a)  Any employer who violates any provision in this chapter, the director may post or affix or both for a period, not to exceed one year, a notice not less than eight and one-half by eleven inches in an area visible to the employer's employees summarizing the violations and other information deemed pertinent by the director, in the form and manner ordered by the director.

(b)  If the employer's violation is a wilful failure to pay all wages as required by this chapter, the director may post or affix or both, for a period not to exceed ninety days, in an area visible to the general public, as ordered by the director, a notice not less than eight and one-half by eleven inches summarizing the violations, in the form and manner ordered by the director.

(c)  Any person other than the director or the director's duly authorized representative who removes, alters, defaces, or otherwise interferes with a notice posted or affixed under this section shall be guilty of a misdemeanor."

     SECTION 4.  Section 387-1, Hawaii Revised Statutes, is amended by amending the definition of "employer" to read as follows:

     ""Employer" includes any individual, partnership, limited liability company, association, corporation, business trust, legal representative, or any organized group of persons, acting directly or indirectly in the interest of an employer in relation to an employee, but shall not include the State or any political subdivision thereof or the United States."

     SECTION 5.  Section 387-6, Hawaii Revised Statutes, is amended by amending subsections (a) and (b) to read as follows:

     "(a)  Every employer shall keep in or about the premises wherein any employee is employed a contemporaneous, true, and accurate record of [the]:

(1) The name, address, and occupation of each [such] employee[, of the]; and

(2) The amount paid each pay period to each [such] employee, of the hours worked each day and each workweek by each [such] employee, and of [such] other information and for [such] periods of time as the director of labor and industrial relations may by [regulation] rule prescribe.  The director or the director's authorized representative [shall], for the purpose of examination, shall have access to and the right to copy from such records.  Every employer shall furnish to the director or the director's authorized representative [such] any information relating to the employment of workers and in [such] a manner as the director may prescribe.

     (b)  Every employer shall post and keep posted [such] notices pertaining to the application of the law as shall be prescribed by the director in conspicuous places in every establishment where any employee is employed so as to permit the employee to observe readily a copy on the way to or from the employee's place of employment."

     SECTION 6.  Section 387-7, Hawaii Revised Statutes, is amended to read as follows:

     "§387-7  Wilful violations; penalty.  Any employer who wilfully hinders or delays the director [of labor and industrial relations] or the director's authorized representative in the performance of the director's duties in the enforcement of this chapter; or who wilfully refuses to admit the director or the director's authorized representative to any place of employment; or who fails to keep or who falsifies any record required under section 387-6 or who refuses to make [such] the records accessible or to give information required for the proper enforcement of this chapter, upon demand, to the director or the director's authorized representative, shall be fined not [more] less than $500 nor more than $5,000 or imprisoned not more than [ninety days, or both.] one year, or both.  If a second or subsequent offense is committed within six years of the date of conviction for a prior offense, the employer shall be guilty of a class C felony for the second or subsequent offense; provided that in addition to any other authorized sentence, the employer shall be fined not less than $500 nor more than $20,000 for each offense.  Each day's failure to keep the records requested under this chapter or to furnish the records or information to the director or the director's representative shall constitute a separate offense."

     SECTION 7.  Section 387-12, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

     "(a)  Criminal[.] penalties.

     (1)  Any person divulging information in violation of section 387-8[, or];

     (2)  [any] Any employer who wilfully violates this chapter or [of] any rule[, regulation,] or order issued under the authority of this chapter[, or];

     (3)  [any] Any employer or the employer's agent or any officer or agent of a corporation, partnership, or limited liability company or any other person who discharges, threatens, or in any other manner discriminates or retaliates against any employee because the employee has made a complaint to the employee's employer, to the director, or to any other person that [the employee has not been paid wages in accordance with this chapter, or] the employer engaged in conduct that the employee reasonably and in good faith believes constitutes a violation this chapter or the employee has instituted or caused to be instituted any proceeding under or related to this chapter, or has testified or is about to testify in any such proceedings[,]; or

     (4)  [any] Any employer or the employer's agent or any officer or agent of a corporation, partnership, or limited liability company who pays or agrees to pay any employee compensation less than that which the employee is entitled to under this chapter,

shall be guilty of a misdemeanor and, upon conviction thereof, shall be punished by a fine of not less than [$50] $500 nor more than [$500] $20,000 or by imprisonment for a period not to exceed one year or by both [such] fine and imprisonment.  If a second or subsequent offense is committed within six years of the date of conviction for a prior offense, the employer shall be guilty of a class C felony for the second or subsequent offense; provided that in addition to any other authorized sentence, the employer shall be fined not less than $500 nor more than $20,000 for each offense.  Each day's failure to keep the records requested under this chapter, or to furnish the records or information to the director or the director's representative, shall constitute a separate offense."

     SECTION 8.  Section 388-1, Hawaii Revised Statutes, is amended by amending the definition of "employer" to read as follows:

     ""Employer" includes any individual, partnership, limited liability company, association, joint-stock company, trust, corporation, the personal representative of the estate of a deceased individual or the receiver, trustee, or successor of any of the same, employing any person, but shall not include the State or any political subdivision thereof or the United States."

     SECTION 9.  Section 388-7, Hawaii Revised Statutes, is amended to read as follows:

     "§388-7  Notification, posting, and records.  Every employer shall:

     (1)  [Notify] Provide each employee in writing[,] in English and in the language identified by each employee as the primary language of the employee, at the time of hiring and on or before February 1 of each subsequent year of the employee's employment with the employer, a notice containing the following:

         (A)  [of the] The rate or rates of pay[,] and basis thereof, whether paid by the hour, shift, day, week, salary, piece, commission, or otherwise, including any rates for overtime, if applicable;

(B) Allowances, if any, claimed as part of the minimum wage, including tip, meal, or lodging allowances;

(C)  [and of the] The day, hour, and place of payment;

(D) The name of the employer, including any "doing business as" names used by the employer;

(E) The physical address of the employer's main office or principal place of business and a mailing address, if different;

(F) The telephone number of the employer; and

(G) Any other information the director deems material and necessary.

Whenever the employer provides the notice to an employee, the employer shall obtain from the employee a signed and dated written acknowledgment in English, and in the primary language of the employee, of the receipt of the notice, which the employer shall maintain and keep for six years.  The director shall prepare templates that comply with the requirements of this paragraph.  Each template shall be dual-language, including English and one additional language.  The director shall determine which languages to provide in addition to English, based on the size of the population of this State that speaks each language and any other factor the director deems relevant.  The templates shall be made available to employers in the manner determined by the director.  When an employee identifies as the employee's primary language a language for which a template is not available from the director, the employer shall comply with this paragraph by providing that employee an English-language notice of acknowledgment.  An employer shall not be penalized for errors or omissions in the non-English portions of any notice provided by the director;

     (2)  Notify each employee in writing or through a posted notice maintained in a place accessible to employees of any changes in the arrangements specified [above] in paragraph (1) at least seven calendar days prior to the time of the change[;], unless the changes are reflected on a timely pay statement furnished to the employee;

     (3)  Provide to each employee in writing or through a posted notice maintained in a place accessible to employees, policies with regard to vacation and sick leave;

     (4)  [Furnish] Provide each employee at every [payday] pay period a legible printed, typewritten, or handwritten record showing [the employee's total gross compensation, the amount and purpose of each deduction, total net compensation, date of payment, and pay period covered;] the information required under section 387-6(c); and maintain and preserve a copy of the record or its equivalent for a period of at least six years; provided that in lieu of the printed, typewritten, or handwritten record required by this paragraph and upon receipt of written authorization from the employee, the employer may provide an electronic record that may be electronically accessed by the employee that shall be retained by the employer for a period of at least six years;

     (5)  Keep posted in a place accessible to employees the notices pertaining to the application of this chapter as [shall be] prescribed by the director [of labor and industrial relations]; and

     (6)  Make and keep records of all employees which shall include basic employment and earnings records, and preserve the records for [a] the period of time and in [a] the manner, as the director shall prescribe by rule."

     SECTION 10.  Section 388-9, Hawaii Revised Statutes, is amended to read as follows:

     "§388-9  Enforcement.  (a)  The director [of labor and industrial relations] shall enforce and administer this chapter and the director or the director's authorized representatives may hold hearings and otherwise investigate charges of violations of this chapter and institute actions for penalties hereunder.

     (b)  The director or the director's authorized representatives may enter and inspect [such] places, question [such] employees, and investigate [such] facts, conditions, or matters as they may deem appropriate to determine whether any person has violated this chapter or any rule [or regulation] issued hereunder or which may aid in the enforcement of this chapter.

The director shall keep confidential the names of employees that are the subject of an investigation until disclosure is necessary for the resolution of an investigation or a complaint.

     (c)  If any judgment obtained by the director against an employer for nonpayment of wages remains unsatisfied for a period of thirty days after the time to appeal therefrom has expired and no appeal is pending or after [such] the judgment has been finally affirmed on appeal, the director may institute proceedings in the name of the State in the circuit court in which the employer has the employer's principal place of business to compel the employer to cease doing any business until the judgment has been satisfied.  Any judgment or court order awarding remedies under this section shall provide that if any amount remains unpaid ninety days after the judgment is issued, or ninety days after the time to appeal has expired and no appeal is pending, whichever is later, the total amount of the judgment shall automatically increase by fifteen per cent.

(d)  If any order to comply issued to an employer under this chapter remains unsatisfied for a period of ten days after the time to appeal therefrom has expired, and no appeal is pending, the director may require the employer to provide an accounting of the employer's assets, including but not limited to a list of the employer's bank accounts, accounts receivable, personal property, real property, motor vehicles, and any other assets, in the form and manner prescribed by the director.  The demand may be made by certified or registered mail.  An employer shall provide amended accountings of assets as ordered by the director.  If within ten days after a demand for an accounting of assets, the employer fails to provide the accounting, or if the employer fails to provide an amended accounting as required, the director may bring an action against the employer in the appropriate circuit court to compel the employer to provide the accounting and pay a civil penalty of no more than $10,000."

     SECTION 11.  Section 388-10, Hawaii Revised Statutes, is amended to read as follows:

     "§388-10  Penalties.  (a)  Civil[.] penalties.

(1)  Any employer who fails to pay wages in accordance with this chapter without equitable justification shall be liable to the employee, in addition to the wages legally proven to be due, for a sum equal to the amount of unpaid wages and interest at a rate of six per cent per year from the date that the wages were due[.];

(2) (A) Any employee who is not provided within ten business days of the employee's first day of employment a notice as required by section 388-7(1) may recover in a civil action damages of $50 for each workweek that the violation occurred or continues to occur, not to exceed $2,500, together with costs and reasonable attorney's fees.  The court may also award other relief, including injunctive and declaratory relief, that the court in its discretion deems necessary or appropriate; and

(B) The director may bring, on behalf of any employee not provided a notice as required by section 388-7(1), any legal action necessary, including administrative action, to collect the claim, and as part of the legal action, in addition to any other remedies and penalties otherwise available.  The director may assess against the employer damages of $50 for each workweek that the violation occurred or continues to occur; and

(3) (A) Any employee who is not provided a pay statement as required by section 388-7(4) shall recover in a civil action damages of $100 for each workweek that the violation occurred or continues to occur, not to exceed $2,500, together with costs and reasonable attorney's fees.  The court may also award other relief, including injunctive and declaratory relief, that the court in its discretion deems necessary or appropriate; and

(B) The director may bring, on behalf of any employee not provided a pay statement as required by section 388-7(4), any legal action necessary, including administrative action, to collect the claim, and as part of the legal action, in addition to any other remedies and penalties otherwise available under this chapter.  The director may assess against the employer damages of $100 for each workweek that the violation occurred or continues to occur.

     (b)  Criminal[.] penalties.

(1)  Any employer who does not pay the wages of any of the employer's employees in accordance with this chapter[, or any];

(2) Any officer or agent of any corporation, partnership, or limited liability company who knowingly permits the corporation, partnership, or limited liability company to violate this chapter by failing to pay wages of any of its employees in accordance with this chapter[, or any];

(3) Any employer or the employer's agent or any officer or agent of a corporation, partnership, or limited liability company, or any other person who discharges, threatens, or in any other manner discriminates or retaliates against any employee because the employee has made a complaint to the employee's employer, or to the director, or to any other person that the [employee has not been paid wages in accordance with this chapter, or] employer engaged in conduct that the employee reasonably and in good faith believes violates this chapter, or the employee has instituted or caused to be instituted any proceeding under or related to this chapter[,] or has testified or is about to testify in any such proceedings[,]; or [any]

(4) Any employer who wilfully fails to comply with any other requirements of this chapter,

shall be fined not less than [$100] $500 nor more than [$10,000] $20,000 or imprisoned for not more than one year, or punished by both fine and imprisonment for each [such] offense.  If a second or subsequent offense is committed within six years of the date of conviction for a prior offense, the employer shall be guilty of a class C felony for the second or subsequent offense; provided that in addition to any other authorized sentence, the employer shall be fined not less than $500 nor more than $20,000 for each offense.  Each day's failure to keep the records requested under this chapter, or to furnish the records or information to the director or the director's representative, shall constitute a separate offense."

     SECTION 12.  Section 388-11, Hawaii Revised Statutes, is amended by amending subsection (c) to read as follows:

     "(c)  The court in any action brought under this section [shall], in addition to any judgment awarded to the plaintiff or plaintiffs, shall allow interest of six per cent per year from the date the wages were due, costs of action, including costs of fees of any nature, and reasonable attorney's fees, to be paid by the defendant.  Any judgment or court order awarding remedies under this section shall provide that if any amounts remain unpaid ninety days after the judgment is issued or ninety days after the time to appeal has expired and no appeal is pending, whichever is later, the total amount of judgment shall automatically increase by fifteen per cent.

     The director shall not be required to:

     (1)  Pay the filing fee or other costs or fees of any nature, including the opposing party's fees and costs; or

     (2)  File a bond or other security of any nature, in connection with [such] the action, with proceedings supplementary thereto, or as a condition precedent to the availability to the director of any process in aid of such action or proceedings.  The director may join various claimants in one preferred claim or lien, and in case of suit join them in one cause of action."

     SECTION 13.  This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun before its effective date.

     SECTION 14.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 15.  This Act shall take effect upon its approval.

INTRODUCED BY:

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Report Title:

Wages; Payment of Compensation; Penalties

Description:

Requires employers to provide employees with specific wage and employer information at the time of hiring and in employees' pay records.  Increases civil and criminal penalties for employers' noncompliance with wage rate notice requirements.  Require public notice of employer violations.

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.