HB404

HOUSE OF REPRESENTATIVES	H.B. NO.	404
THIRTIETH LEGISLATURE, 2019
STATE OF HAWAII

A BILL FOR AN ACT

relating to employer and employee relationship.

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

SECTION 1. The legislature finds that the master and servant statutory language is outdated and should be updated to more accurately reflect the relationship between two parties engaged in an employment relationship.

The purpose of this Act is to replace the term "master and servant" with "employer and employee" in the Hawaii Revised Statutes.

SECTION 2. Section 233-1, Hawaii Revised Statutes, is amended to read as follows:

"§233-1 Certain relationship deemed as that of employer-employee. Whenever a person, firm, corporation, or the like, shall engage or continue in this State in the business of selling tangible personal property, and shall cause such property to be distributed to, by, or through representatives, distributors, dealers, salespersons, peddlers, canvassers, carriers, truckers, or the like, the department of taxation may adopt, in the manner provided by law, one or more rules or regulations providing that for the purposes of the tax laws administered by the department the group, class, or category of persons or business described therein (to be determined by the department as may be appropriate for the purposes of the particular rule or regulation) shall, irrespective of whether the relationship or class of business otherwise would be deemed that of seller and buyer, or principal and agent, [~~or master and servant,~~] be deemed to be that of employer and employee; provided that no rule or regulation adopted under this section shall apply to any group, class, or category of persons or business as to which the department shall determine, or it shall be shown:

(1) That the potential employee has been and will continue to be free from control or direction over the performance of the business or services undertaken by the potential employee, and also

(2) That the business or services are performed outside of all the places of business of the potential employer, and also

(3) That the potential employee is customarily engaged in an independently established trade, occupation, or business of the same nature as that involved in the business or services in which the potential employee is engaged or which the potential employee has undertaken for, with, or at the behest of the potential employer.

As used in paragraphs (1), (2), and (3) "potential employee" means the person who by such rule or regulation would be classed as an employee, and "potential employer" means the person, firm, corporation, or the like, who by such rule or regulation would be classed as the employer."

SECTION 3. Section 383-6, Hawaii Revised Statutes, is amended to read as follows:

"§383-6 [~~Master and servant~~] Employer and employee relationship, not required when. Services performed by an individual for wages or under any contract of hire shall be deemed to be employment subject to this chapter irrespective of whether the common law relationship of [~~master and servant~~] employer and employee exists unless and until it is shown to the satisfaction of the department of labor and industrial relations that:

(1) The individual has been and will continue to be free from control or direction over the performance of such service, both under the individual's contract of hire and in fact;

(2) The service is either outside the usual course of the business for which the service is performed or that the service is performed outside of all the places of business of the enterprise for which the service is performed; and

(3) The individual is customarily engaged in an independently established trade, occupation, profession, or business of the same nature as that involved in the contract of service."

SECTION 4. If any provision of this Act, or the application thereof to any person or circumstance, is held invalid, the invalidity does not affect other provisions or applications of the Act that can be given effect without the invalid provision or application, and to this end the provisions of this Act are severable.

SECTION 5. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 6. This Act shall take effect upon its approval.

INTRODUCED BY:	_____________________________