SB2104

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 when needing to provide care to a newborn, bond with a new child, or care for a family member with a serious health condition. The legislature further finds that current Hawaii law only extends four weeks of unpaid leave to employees working for a business with over one hundred employees.

Only approximately thirteen 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. On any given day in Hawaii, two hundred forty-seven thousand people in the State serve as family caregivers. Hawaii has the fastest growing population over the age of sixty-five in the nation, and that number is expected to grow by at least eighty-one per cent by the year 2030. Of those who need leave but do not have that benefit, nearly one in three need leave to care for an ill spouse or elderly parent.

The purpose of this Act is to ensure that employees in Hawaii are provided family leave insurance benefits during times when they need to provide care for their families.

SECTION 2. Chapter 398, Hawaii Revised Statutes, is amended by adding nine new sections to be appropriately designated and to read as follows:

"§398-A Designation of a designated person. An employer may establish a process for a covered individual to designate a designated person within thirty days of the covered individual becoming eligible for benefits under this chapter; provided that the employer shall notify the department of all designations and changed designations. Thereafter, the employer shall permit the covered individual to make or change a designation, as applicable, on an annual basis. If a covered individual's employer establishes a process, the covered individual shall comply with the process. If a covered individual's employer does not establish a process, the covered individual may make or change a designation when filing a claim for family leave insurance benefits under this chapter. The department shall adopt rules pursuant to chapter 91 to implement this section.

§398-B Family leave trust fund; family leave insurance benefits. (a) There is established a trust fund to be known as the family leave trust fund.

(b) The trust fund shall consist of employee contributions based on the employee's average weekly wage as well as interest earned and income, dividends, refunds, rate credits, and other returns received by the fund. The taxable rate of the contribution shall be in accordance with the employee contribution rate to the temporary disability insurance fund. Any and all sums contributed or paid from any source to the fund created by this section, and all assets of the fund including any and all interest and earnings of the same, are and shall be held in trust by the department for the exclusive use and benefit of the employee-beneficiaries, including to finance benefits, administration, outreach, education or study of or related to family leave insurance, and shall not be subject to appropriation for any other purpose.

§398-C Eligibility for payment of benefits. Family leave insurance benefits are payable to:

(1) A person who:

(A) Is a covered individual, as defined in section 398-1; and

(B) Meets one of the following requirements:

(i) Because of birth, adoption, or placement through foster care, is caring for a new child during the first year after the birth, adoption, or placement;

(ii) Is caring for a family member with a serious health condition;

(iii) Is caring for a qualifying service member who is the employee's next of kin; or

(iv) Has a qualifying exigency, as defined in section 398-1, arising out of the deployment of a family member or the employee; or

(2) An individual who is not currently employed, but who is a covered individual, as defined in section 398‑1, and meets one of the requirements listed in paragraph (1)(B).

§398-D Family leave insurance program. (a) The department shall establish and administer a family leave insurance program and pay family leave insurance benefits as specified in this chapter.

(b) The department shall establish procedures and forms for filing claims for benefits under this chapter. The department shall notify the employer of a covered individual who files a claim for benefits under this chapter that the claim has been filed.

(c) The department shall use information sharing and integration technology to facilitate the disclosure of relevant information or records including use of information and technology already existing in the temporary disability insurance program to the extent feasible following any requirements for consent to disclosure under state law.

(d) Information contained in the files and records pertaining to an individual under this chapter are confidential and not available for public inspection, other than to public employees in the performance of their official duties. However, the individual or an authorized representative of an individual may review the records or receive specific information from the records on the presentation of the signed authorization of the individual.

§398-E Report to the legislature. Beginning July 1, 2019, the department shall report to the legislature no later than twenty days prior to the convening of each regular session on outreach efforts; projected and actual program participation, including the percentage of those eligible for family leave insurance benefits under this chapter who receive benefits; premium rates; and fund balances.

§398-F Outreach and education. The department shall conduct a public outreach and education campaign to inform employees and employers regarding the availability of family leave insurance benefits. The department may use a proportion of the funds collected for the family leave insurance program in a given year to pay for the public education program. Outreach information shall be available in English and other languages spoken within the State.

§398-G Wage withholding. (a) Each employee shall make a contribution to the family leave trust fund per pay period, via wage withholding per pay period, transmitted by the employer to the trust fund.

(b) If there is a dispute between the employee and the employer relating to the withholding of wages as contributions for paid family leave insurance benefits, either party may file with the director a petition for determination of the amount to be withheld. The matter shall be determined by an officer of the department. If either party is dissatisfied with the determination, the party may petition for redetermination and thereupon the petition shall be transferred to the referee.

§398-H Family leave insurance benefits; weekly benefit amount. (a) Family leave insurance benefits are payable to each covered individual as follows:

(1) On or after January 1, 2019, a weekly benefit amount for at least eight weeks per calendar year;

(2) On or after January 1, 2020, a weekly benefit amount for at least ten weeks per calendar year; and

(3) On or after January 1, 2021, a weekly benefit amount for at least twelve weeks per calendar year.

(b) The weekly benefit amount shall be computed as follows:

(1) On or after January 1, 2019, at least per cent of the employee's average weekly wage or at least per cent of the state average weekly wage, whichever is less;

(2) On or after January 1, 2020, at least per cent of the employee's average weekly wage or at least per cent of the state average weekly wage, whichever is less; and

(3) On or after January 1, 2021, at least per cent of the employee's average weekly wage or at least per cent of the state average weekly wage, whichever is less; and

§398-I Duplication of benefits not permitted. No family leave insurance benefits shall be payable for any period of leave for which the employee is entitled to receive:

(1) Weekly benefits under the employment security law or similar laws of this State or of any other state or of the United States, or under any temporary disability benefits law of any other state or of the United States except as provided in section 392-66;

(2) Weekly disability insurance benefits under title 42 United States Code Annotated section 423;

(3) Weekly benefits for total disability under the workers' compensation law of this State or any other state or of the United States, except benefits for permanent partial or permanent total disability previously incurred. If the claimant does not receive benefits under such workers' compensation law and the claimant's entitlement to such benefits is seriously disputed, the employee, if otherwise eligible, shall receive temporary disability benefits under this chapter, but any insurer or employer or the trust fund for disability benefits providing such benefits shall be subrogated, as hereinafter provided, to the employee's right to benefits under the workers' compensation law for the period of disability for which the employee received benefits under this chapter to the extent of the benefits so received; and

(4) Indemnity payments for wage loss under any applicable employers' liability law of this State, or of any other state or of the United States. If an employee has received benefits under this chapter for a period of disability for which the employee is entitled to such indemnity payments, any insurer or employer or the trust fund for disability benefits providing such benefits shall be subrogated to the employee's right to such indemnity payments in the amount of the benefits paid under this chapter."

SECTION 3. Section 398-1, Hawaii Revised Statutes, is amended as follows:

1. By adding five new definitions to be appropriately inserted and to read:

""Covered individual" means any person who:

(1) Is an employee or has been an employee within the last twenty-six weeks if currently unemployed;

(2) Meets the requirements of this chapter and in rules implemented pursuant to this chapter; and

(3) Submits an application for family leave insurance benefits to the department.

"Designated person" means one person designated by a covered individual for whom the covered individual will provide care under this chapter if the designated person has a serious health condition.

"Family leave insurance benefits" means the benefits provided pursuant to this chapter.

"Family member" means a child, parent, person to whom the covered individual is legally married under the laws of any state, a biological, foster, or adopted sibling, or the spouse or reciprocal beneficiary of a sibling, a reciprocal beneficiary, or a designated person.

"Qualifying exigency" means:

(1) Notice of deployment of a service member received within seven days of deployment;

(2) Attendance of military events or related activities;

(3) Child care or attendance of school activities, if due directly or indirectly to the active duty call or active duty status of a service member;

(4) To make financial or legal arrangements for a service member's absence or as a result of the service member's absence;

(5) Attending counseling provided by someone other than a health care provider if the need for counseling arises from the active duty call or active duty of a service member; or

(6) To spend up to five days with a service member for each instance of short-term, temporary rest and recuperation leave during a period of deployment."

2. By amending the definition of "child" to read:

""Child" means an individual who is a biological, adopted, or foster son or daughter; a stepchild; [or] a legal ward of [~~an employee.~~] a covered individual; a child of a reciprocal beneficiary; a grandchild; or a child of a covered individual who stands in loco parentis."

3. By amending the definition of "employer" to read:

""Employer" means any individual or organization, including the State, any of its political subdivisions, any instrumentality of the State or its political subdivisions, any partnership, association, trust, estate, joint stock company, insurance company, or corporation, whether domestic or foreign, or receiver or trustee in bankruptcy, or the legal representative of a deceased person, who employs [~~one hundred~~] fifty or more employees for each working day during each of twenty or more calendar weeks in the current or preceding calendar year."

4. By amending the definition of "parent" to read:

""Parent" means a biological, foster, or adoptive parent, a parent-in-law, a stepparent, a legal guardian, a grandparent, [or] a grandparent-in-law[.], a parent or grandparent of a reciprocal beneficiary, or a person who stood in loco parentis when the covered individual was a minor child."

SECTION 4. Section 398-2, Hawaii Revised Statutes, is amended to read as follows:

"[[]§398-2[]] Inapplicability. The rights provided under this chapter shall not apply to employees of an employer with fewer than [~~one hundred~~] fifty employees."

SECTION 5. Section 398-3, Hawaii Revised Statutes, is amended as follows:

1. By amending subsection (a) to read:

"(a) An employee shall be entitled to [~~a total of four weeks of~~] family leave [~~during any calendar year:~~] for the duration and amount specified in section 398-H:

(1) [~~Upon the birth of a child of the employee or the adoption of a child;~~] To care for the covered individual's child during the first year after the child's birth, foster placement, or placement for adoption with the covered individual; or

(2) To care for the [~~employee's child, spouse, reciprocal beneficiary, sibling, or parent~~] covered individual's family member with a serious health condition."

2. By amending subsection (e) to read:

"(e) Nothing in this chapter shall entitle an employee to more than [~~a total of four weeks~~] the duration and amount of leave [~~in any twelve-month period.~~] specified in section 398-H in any twelve-month period."

SECTION 6. Section 398-4, Hawaii Revised Statutes, is amended to read as follows:

"§398-4 [~~Unpaid leave~~] Leave permitted; relationship to paid leave; sick leave. (a) Pursuant to section 398-3, an employee shall be entitled to [~~four weeks~~] the duration and amount of family leave[.] specified in section 398-H. [The family leave shall consist of unpaid leave, paid leave, or a combination of paid and unpaid leave. If an employer provides paid family leave for fewer than four weeks, the additional period of leave added to attain the four-week total may be unpaid.] An employer who provides paid family leave insurance benefits beyond what is required by this chapter may require that the leave run concurrently with the designated weeks required under this chapter, but subject to section 392‑41(b)(2), shall not require the leave to be applied against accrued sick or vacation hours.

(b) Except as otherwise provided in subsection (c), an employee may elect to substitute any of the employee's accrued paid leaves, including but not limited to vacation, personal, or family leave for any part of the [~~four-week period in subsection (a).~~] duration of family leave specified in section 398-H.

(c) [An employer who provides sick leave for employees shall permit an employee to use the employee's accrued and available sick leave for purposes of this chapter; provided that an employee shall not use more than ten days per year for this purpose, unless an express provision of a valid collective bargaining agreement authorizes the use of more than ten days of sick leave for family leave purposes.] Nothing in this section shall require an employer to diminish an employee's accrued and available sick leave below the amount required pursuant to section 392-41; provided that any sick leave in excess of the minimum statutory equivalent for temporary disability benefits as determined by the department may be used for purposes of this chapter.

(d) No assignment, pledge, or encumbrance of any right to benefits that are or may become due or payable under this chapter shall be valid; and the rights to benefits shall be exempt from levy, execution, attachment, garnishment, or any other remedy whatsoever provided for the collection of debt. No waiver of any exemption provided for in this section shall be valid.

(e) Nothing in this chapter shall prevent a biological mother receiving temporary disability benefits for recovery from childbirth from applying for and receiving paid family leave for the purpose of caregiving and bonding with her child after the period during which temporary disability insurance benefits are compensable. For family leave purposes, there shall be no waiting period for benefits to begin.

(f) Benefits under the Family and Medical Leave Act of 1993 shall run concurrently with benefits under this chapter.

(g) An employee receiving paid family leave insurance benefits shall not earn wages during such period."

SECTION 7. Section 398-21, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

"(a) Any individual claiming to be aggrieved by an alleged unlawful act under this chapter, including the denial of family leave insurance benefits, may file with the department a verified complaint in writing."

SECTION 8. Section 398-23, Hawaii Revised Statutes, is amended by amending subsection (d) to read as follows:

"(d) If the department determines after investigation that this chapter has been violated[,] by an employer, the department shall inform the employer and endeavor to remedy the violation by informal methods, such as conference or conciliation. If the department determines that family leave insurance benefits have been wrongfully withheld, the department shall order immediate payment to the employee found entitled to those benefits."

SECTION 9. Section 398-24, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

"(a) Upon appeal by a complainant or by the employer, the order issued by the department shall be subject to a de novo review by a hearings officer appointed by the director."

SECTION 10. Section 398-26, Hawaii Revised Statutes, is amended by amending subsection (b) to read as follows:

"(b) Relief under this section may include:

(1) The amount of any benefits under this chapter, wages, salary, employment benefits, or other compensation denied or lost to the employee by reason of the violation; or

(2) In a case in which benefits under this chapter, wages, salary, employment benefits, or other compensation have not been denied or lost to the employee, any actual monetary losses sustained by the employee as a direct result of the violation, such as the cost of providing care, up to a sum equal to [~~four weeks~~] the duration and amount of wages or salary for the employee[.], pursuant to section 398-H."

SECTION 11. There is appropriated out of the general revenues of the State of Hawaii the sum of $300,000 or so much thereof as may be necessary for fiscal year 2018-2019 for the purpose of hiring and employing an administrator, administrative assistant, and an accountant to perform functions relating to the administration of the family leave trust fund, including the oversight of payroll deductions, administrative processes, and payment to eligible employees.

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

SECTION 12. The department of labor and industrial relations shall submit a report to the legislature regarding the implementation of family leave insurance benefits established under this Act, including the feasibility of extending family leave insurance benefits to self-employed persons, no later than twenty days prior to the convening of the regular session of 2020.

SECTION 13. The department of budget and finance, in collaboration with the Hawaii commission on the status of women, shall perform an actuarial study on the economic impact and operational requirements of providing the family leave insurance benefits established under this Act. The department of budget and finance shall submit the actuarial study to the legislature no later than twenty days prior to the convening of the regular session of 2020.

SECTION 14. In codifying the new sections added by section 2 of this Act, the revisor of statutes shall substitute appropriate section numbers for the letters used in designating the new sections in this Act.

SECTION 15. This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun before its effective date.

SECTION 16. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 17. This Act shall take effect on July 1, 2018; provided that sections 2 through 10 shall take effect on January 1, 2019.

INTRODUCED BY:	_____________________________

THE SENATE	S.B. NO.	2104
TWENTY-NINTH LEGISLATURE, 2018
STATE OF HAWAII