STAND. COM. REP. NO. 2650

Honolulu, Hawaii

RE:    S.B. No. 2723

       S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Twenty-Eighth State Legislature

Regular Session of 2016

State of Hawaii

Sir:

     Your Committee on Ways and Means, to which was referred S.B. No. 2723, S.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO ENFORCEMENT OF WAGE LAWS,"

begs leave to report as follows:

     The purpose and intent of this measure is to increase the minimum fines for contractors and subcontractors who violate the wage and hour requirements of employees on public works projects.

     Specifically, this measure increases the minimum monetary penalties as follows:

     (1)  For a first violation, from $25 to $1,000; and

     (2)  For a second violation within two years of the first notice of violation, from $100 to $10,000.

     Your Committee received written comments in support of this measure from the Department of Labor and Industrial Relations, Hawaii Construction Alliance, and Pacific Industrial Coatings.  Your Committee received written comments in opposition to this measure from the General Contractors Association of Hawaii; Raynor Overhead Doors and Gates Inc; Building Industry Association of Hawaii; Nordic PCL Construction, Inc; Healy Tibbitts Builders, Inc; LYZ, Inc; Royal Contracting Company; and S&M Sakamoto, Inc.

     Your Committee finds that currently, a contractor or subcontractor could be fined as little as $25 for the first offense and $100 for a second offense for violations of Chapter 104, Hawaii Revised Statutes, the wages and hours law for public works construction.  Your Committee further finds that these low amounts are not sufficient deterrents for compliance with Chapter 104, Hawaii Revised Statutes.  Your Committee believes that the increased fines will help deter violations of the State's public works wage and hour laws.

     As affirmed by the record of votes of the members of your Committee on Ways and Means that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 2723, S.D. 1, and recommends that it pass Third Reading.

Respectfully submitted on behalf of the members of the Committee on Ways and Means,

________________________________

JILL N. TOKUDA, Chair