HB2598 HD1

SECTION 1. The legislature finds that Hawaii's working families are not adequately supported during times of caregiving and illness. While the federal Family and Medical Leave Act of 1993 allows twelve weeks of unpaid leave to employees who have worked at a business that employs fifty or more employees, the majority of Hawaii's workforce cannot afford to take unpaid leave to care for a child or an elderly family member with a serious health condition. Hawaii law offers only a modest four-week extension of unpaid leave and this applies only to Hawaii's few large employers with more than one hundred employees.

The legislature further finds that only eleven per cent of workers in the United States have access to paid family leave through their employers. Women, as primary caregivers of infants, children, and elderly parents, are affected disproportionately by the unavailability of paid family and medical leave. In Hawaii, 247,000 people serve as family caregivers. Hawaii has the fastest growing population of individuals over the age of sixty-five in the nation, and that number is expected to grow by eighty-one per cent by the year 2030. Of those who would benefit from paid family leave, nearly one-third would take those leave benefits to care for an ill spouse or elderly parent. In short, most workers, at some point, will need to take time off to care for an ill family member, but very few can afford it.

The purpose of this Act is to establish paid family leave and lay the groundwork to implement a paid family leave framework of laws and policies so that all employees can access leave benefits during times when they need to provide care for a family member.

SECTION 2. Chapter 398, Hawaii Revised Statutes, is amended by adding a new section to part I to be appropriately designated and to read as follows:

"§398- Paid family leave special fund. (a) There is established a paid family leave special fund into which shall be deposited the following moneys:

(1) Appropriations by the legislature to the special fund;

(2) Gifts, donations, and grants from public agencies and private persons; and

(3) Money contributed by employers and employees as a condition of paid family leave implementation established by the paid family leave implementation board under Act , Session Laws of Hawaii 2018.

All interest earned or accrued on moneys deposited in the fund shall become part of the fund. The fund shall be administered by the department; provided that the department may contract with a public or private agency to provide the day-to-day management of the fund.

(b) Subject to legislative authorization, the department may expend moneys from the fund:

(1) For permanent and temporary staff positions; and

(2) To cover administrative and operational costs of implementing any legislative requirement to establish paid family leave for all workers in the State.

(c) The money deposited into the fund and the interest earned shall not revert to the unrestricted fund balance of the general fund at the end of the fiscal year, or at any time."

SECTION 3. Section 36-27, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

"(a) Except as provided in this section, and notwithstanding any other law to the contrary, from time to time, the director of finance, for the purpose of defraying the prorated estimate of central service expenses of government in relation to all special funds, except the:

(1) Special out-of-school time instructional program fund under section 302A-1310;

(2) School cafeteria special funds of the department of education;

(3) Special funds of the University of Hawaii;

(4) State educational facilities improvement special fund;

(5) Convention center enterprise special fund under section 201B-8;

(6) Special funds established by section 206E-6;

(7) Aloha Tower fund created by section 206J-17;

(8) Funds of the employees' retirement system created by section 88-109;

(9) Hawaii hurricane relief fund established under chapter 431P;

(10) Hawaii health systems corporation special funds and the subaccounts of its regional system boards;

(11) Tourism special fund established under section 201B-11;

(12) Universal service fund established under section 269-42;

(13) Emergency and budget reserve fund under section 328L-3;

(14) Public schools special fees and charges fund under section 302A-1130;

(15) Sport fish special fund under section 187A-9.5;

[[](16)[]] Neurotrauma special fund under section 321H-4;

[[](17)[]] Glass advance disposal fee established by section 342G-82;

[[](18)[]] Center for nursing special fund under section 304A-2163;

[[](19)[]] Passenger facility charge special fund established by section 261-5.5;

[[](20)[]] Solicitation of funds for charitable purposes special fund established by section 467B-15;

[[](21)[] ] Land conservation fund established by section 173A-5;

[[](22)[]] Court interpreting services revolving fund under section 607-1.5;

[[](23)[]] Trauma system special fund under section 321-22.5;

[[](24)[]] Hawaii cancer research special fund;

[[](25)[]] Community health centers special fund;

[[](26)[]] Emergency medical services special fund;

[[](27)[]] Rental motor vehicle customer facility charge special fund established under section 261-5.6;

[[](28)[]] Shared services technology special fund under section 27-43;

[[](29)[] ] Automated victim information and notification system special fund established under section 353-136;

[[](30)[]] Deposit beverage container deposit special fund under section 342G-104;

[[](31)[]] Hospital sustainability program special fund under [[]section 346G-4[]];

[[](32)[] ] Nursing facility sustainability program special fund under [[]section 346F-4[]];

[[](33)[]] Hawaii 3R's school improvement fund under section 302A-1502.4;

[[](34)[]] After-school plus program revolving fund under section 302A-1149.5; [~~and~~]

[[](35)[]] Civil monetary penalty special fund under section 321-30.2[,]; and

(36) Paid family leave special fund under section 398- ,

shall deduct five per cent of all receipts of all other special funds, which deduction shall be transferred to the general fund of the State and become general realizations of the State. All officers of the State and other persons having power to allocate or disburse any special funds shall cooperate with the director in effecting these transfers. To determine the proper revenue base upon which the central service assessment is to be calculated, the director shall adopt rules pursuant to chapter 91 for the purpose of suspending or limiting the application of the central service assessment of any fund. No later than twenty days prior to the convening of each regular session of the legislature, the director shall report all central service assessments made during the preceding fiscal year."

SECTION 4. Section 36-30, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

"(a) Each special fund, except the:

(1) Special out-of-school time instructional program fund under section 302A-1310;

(2) School cafeteria special funds of the department of education;

(3) Special funds of the University of Hawaii;

(4) State educational facilities improvement special fund;

(5) Special funds established by section 206E-6;

(6) Aloha Tower fund created by section 206J-17;

(7) Funds of the employees' retirement system created by section 88-109;

(8) Hawaii hurricane relief fund established under chapter 431P;

(9) Convention center enterprise special fund established under section 201B-8;

(10) Hawaii health systems corporation special funds and the subaccounts of its regional system boards;

(11) Tourism special fund established under section 201B-11;

(12) Universal service fund established under section 269-42;

(13) Emergency and budget reserve fund under section 328L-3;

(14) Public schools special fees and charges fund under section 302A-1130;

(15) Sport fish special fund under section 187A-9.5;

[[](16)[]] Neurotrauma special fund under section 321H-4;

[[](17)[] ] Center for nursing special fund under section 304A-2163;

[[](18)[]] Passenger facility charge special fund established by section 261-5.5;

[[](19)[]] Court interpreting services revolving fund under section 607-1.5;

[[](20)[]] Trauma system special fund under section 321-22.5;

[[](21)[] ] Hawaii cancer research special fund;

[[](22)[]] Community health centers special fund;

[[](23)[]] Emergency medical services special fund;

[[](24)[] ] Rental motor vehicle customer facility charge special fund established under section 261-5.6;

[[](25)[]] Shared services technology special fund under section 27-43;

[[](26)[]] Nursing facility sustainability program special fund established pursuant to [[]section 346F-4[]];

[[](27)[] ] Automated victim information and notification system special fund established under section 353-136;

[[](28)[]] Hospital sustainability program special fund under [[]section 346G-4[~~]; and~~];

[[](29)[]] Civil monetary penalty special fund under section 321-30.2[,]; and

(30) Paid family leave special fund under section 398- ,

shall be responsible for its pro rata share of the administrative expenses incurred by the department responsible for the operations supported by the special fund concerned."

SECTION 5. (a) By January 1, 2020, the department of labor and industrial relations shall adopt rules that establish and codify paid family leave for all workers in the State.

(b) The department may adopt interim rules, which shall be exempt from chapter 91, Hawaii Revised Statutes, to effectuate the purposes of this Act; provided that the interim rules shall remain in effect until July 1, 2022, or until rules are adopted pursuant to subsection (a), whichever occurs sooner.

(1) A minimum of weeks of paid leave;

(2) Paid family leave coverage for all employees of all employers that employ one or more employees;

(3) A system of progressive wage replacement to allow low-income workers to receive a higher percentage of their weekly earnings than average or high-wage workers; and

(4) Job protection to ensure that utilization of paid family leave does not adversely impact employment.

(d) The paid family leave program shall begin collecting payments from employers and employees by July 1, 2021, and shall process payments by July 1, 2022.

SECTION 6. (a) There is established a paid family leave implementation board within the department of labor and industrial relations for administrative purposes only to assist the department in establishing paid family leave for all workers in the State, pursuant to this Act.

(b) The paid family leave implementation board shall comprise the following individuals or their designees:

(1) The governor's chief of staff, who shall serve as chairperson;

(2) The director of labor and industrial relations;

(3) The director of human resources development; who shall serve as an ex-officio member;

(4) The comptroller; who shall serve as an ex-officio member;

(5) The insurance commissioner;

(6) The chairperson of the senate committee on labor, or a successor committee with jurisdiction over labor; and

(7) The chairperson of the house of representatives committee on labor and public employment, or a successor committee with jurisdiction over labor.

(1) One representative of a business employing one hundred or more employees, to be appointed by the governor;

(2) One representative of a business employing between fifty and one hundred employees, to be appointed by the speaker of the house of representatives;

(3) One representative of a business employing fifty or fewer employees, to be appointed by the president of the senate;

(4) One representative of the insurance industry, to be appointed by the president of the senate;

(5) One representative of the medical or public health community, to be appointed by the speaker of the house of representatives;

(6) One representative of a labor union in the State, to be appointed by the president of the senate;

(7) One representative of a labor union in the State, to be appointed by the speaker of the house of representatives;

(8) One member representing paid family leave advocates, to be appointed by the president of the senate;

(9) One member representing paid family leave advocates, to be appointed by the Hawaii state commission on the status of women;

(10) One member representing paid family leave advocates, to be appointed by the speaker of the house of representatives; and

(11) One member representing human resources administrators, to be appointed by the director of labor and industrial relations.

(d) The paid family leave implementation board shall develop an analysis and implementation plan for providing workers with family leave insurance benefits during times when a worker is required to take leave to care for a family member.

(e) All executive branch departments and agencies shall participate and engage in data-sharing agreements for the purposes of this Act to commence no later than twenty days prior to the convening of the regular session of 2019.

(f) The legislative reference bureau shall conduct a study, including an actuarial analysis, on the items enumerated in subsection (g)(1), (2), (3), (4), and (6).

(g) No later than twenty days prior to the regular session of 2019, the paid family leave implementation board shall submit a report to the legislature that includes:

(1) A comparative analysis of potential paid family leave models to cover all workers including, but not limited to, social insurance and temporary disability insurance expansion, including a breakdown of the costs for implementing and sustaining each model, review of other state leave models, and review of current temporary disability insurance usage and other state temporary disability insurance models;

(2) Models that shall consider progressive wage replacement and job protection;

(3) A multi-year budget for establishing a paid family leave insurance program;

(4) A timeline for implementing paid family leave, including benchmarks and deliverables;

(5) A schedule for ongoing audits;

(6) Findings and other recommendations, including recommendations for ongoing regulation and additional funding resources; and

(7) Proposed legislation, if any.

(h) No later than twenty days prior to the regular sessions of 2020, 2021, 2022, 2023, and 2024 the paid family leave implementation board shall submit a report to the legislature that includes:

(1) Updates to the analysis and implementation plan, as necessary;

(2) The progress of the department of labor and industrial relations in meeting its obligations under this Act;

(3) Additional findings and recommendations, if any; and

(4) Proposed legislation, if any.

(i) The board shall cease to exist on January 1, 2024.

SECTION 7. There is appropriated out of the general revenues of the State of Hawaii the sum of $1,750,000 or so much thereof as may be necessary for fiscal year 2018-2019 to be deposited into the paid family leave special fund.

SECTION 8. There is appropriated out of the paid family leave special fund the sum of $1,500,000 or so much thereof as may be necessary for fiscal year 2018-2019 for one full-time equivalent (1.0 FTE) program manager to support the paid family leave implementation board and for the expenses of the paid family leave implementation board and the department of labor and industrial relations in establishing paid family leave for all workers by January 1, 2020; provided that the department of labor and industrial relations may contract for services to complete the report as required under section 4(g) of this Act.

The sum appropriated shall be expended by the department of labor and industrial relations for the purposes of this Act.

SECTION 9. There is appropriated out of the paid family leave special fund the sum of $250,000 or so much thereof as may be necessary for fiscal year 2018-2019 for the legislative reference bureau to conduct a study, including an actuarial analysis, pursuant to section 4(f) of this Act; provided that the legislative reference bureau may contract for services to complete the study as required under this Act.

The sum appropriated shall be expended by the legislative reference bureau for the purposes of this Act.

SECTION 10. This Act shall take effect upon its approval; provided that sections 2, 3, 4, 7, 8, and 9 shall take effect on July 1, 2018.

HOUSE OF REPRESENTATIVES	H.B. NO.	2598
TWENTY-NINTH LEGISLATURE, 2018		H.D. 1
STATE OF HAWAII