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 provide care to a newborn, bond with a new child, or care for a family member with a serious health condition. The legislature finds that the Hawaii family leave law further restricts eligibility by extending four weeks of unpaid leave only to those employees who work at a business 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. Approximately 247,000 people in Hawaii serve as family caregivers. Hawaii has the fastest growing sixty-five-plus population in the nation, which is expected to grow by eighty-one per cent by the year 2030. Of those who need leave but cannot take it, nearly one in three need leave to care for an ill spouse or parent. Women, as primary caregivers of infants, children, and elderly parents, are affected disproportionately by the unavailability of paid family and medical leave.

The legislature further finds that paid sick leave does not currently extend to most part-time food service workers. This measure only affects large companies with or more employees. Employers who already offer sick leave benefits, including those with more generous sick leave benefit plans, are unaffected by this measure.

The purposes of this Act are to:

(1) Require the office of the lieutenant governor and the department of labor and industrial relations to have an actuarial study prepared to determine the:

(a) Estimated liability and cost of implementing a family leave insurance program that would provide an employee with up to:

(i) Twelve weeks of paid family leave per calendar year; and

(ii) Twelve weeks of paid family leave per calendar year after any leave available pursuant to the federal Family and Medical Leave Act is exhausted; and

(b) Impact the family leave insurance program would have on the existing temporary disability insurance program; and

(2) Provide paid sick leave for service workers, which may be used for caregiving purposes.

SECTION 2. The office of the lieutenant governor and the department of labor and industrial relations shall retain professional services to conduct an actuarial study and prepare a report to determine the:

(1) Estimated cost and financial impact of implementing a family leave insurance program that allows an employee, as defined in section 398-1, Hawaii Revised Statutes, to have up to:

(a) Twelve weeks of paid family leave as compared to the four weeks of paid family leave per calendar year currently provided by section 398-3, Hawaii Revised Statutes; and

(b) Twelve weeks of paid family leave as compared to the four weeks of paid family leave per calendar year currently provided by section 398-3, Hawaii Revised Statutes, after any leave available pursuant to the federal Family and Medical Leave Act is exhausted;

(2) Projected figures for the number of employees eligible for the family leave insurance program and the percentage of eligible employees projected to participate in the family leave insurance program;

(3) Projected premium rates for the family leave insurance program;

(4) Projected fund balances for the family leave insurance trust fund; and

(5) Projected impact that the family leave insurance program would have on the existing temporary disability insurance program if it were to be implemented.

The office of the lieutenant governor and department of labor and industrial relations shall submit an interim report to the legislature no later than twenty days prior to the convening of the 2016 regular session and a final report no later than twenty days prior to the convening of the 2017 regular session.

SECTION 3. There is appropriated out of the general revenues of the State of Hawaii the sum of $ or so much thereof as may be necessary for fiscal year 2015-2016 and the same sum or so much thereof as may be necessary for fiscal year 2016-2017 for the purpose of conducting the actuarial study and preparing the report required by section 2 of this Act.

The sums appropriated shall be expended by the office of the lieutenant governor for the purposes of this Act.

PART II.

SECTION 4. Chapter 388, part I, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§388- Paid sick leave; service workers. (a) As used in this section:

"Child" means a:

(1) Biological, adopted, foster, or stepchild of a service worker who is less than eighteen years of age;

(2) Legal ward of a service worker who is less than eighteen years of age; or

(3) Child of a service worker who stands in loco parentis to the child who is:

(A) Less than eighteen years of age; or

(B) Eighteen years of age or older and incapable of self-care because of a mental or physical disability.

"Day or temporary worker" means:

(1) An individual who works for another person for less than twenty hours per week, except for an individual who works for a food establishment; or

(2) An individual who works:

(A) On a per diem basis; or

(B) As an occasional or irregular basis for only the time required to complete such work, whether the individual is paid by the person for whom work is performed or by an employment agency, as defined in section 373-1.

"Employer" has the same meaning as in section 388-1, but shall refer to employers who employ or more individuals in the State in any one quarter in the previous year, which shall be determined on January 1, annually. The term "employer" excludes any nationally chartered organization exempt from taxation under section 501(c)(3) of the Internal Revenue Code, as amended, that provides recreation, child care, or education services.

"Family violence" has the same meaning as in section 571-2.

"Food establishment" means:

(1) Any place or portion thereof maintained, used, or operated for the purpose of storing, preparing, serving, manufacturing, packaging, transporting, or otherwise handling food at the retail or wholesale level;

(2) Any place used for cleaning food equipment or utensils in support of another food establishment; or

(3) Any operation that is conducted in, or in conjunction with, a mobile, stationary, temporary, or permanent facility or location where food is served or provided to the public, with or without charge, regardless of whether the food is consumed on or off the premises.

"Service worker" means an employee, including an employee of a food establishment, excluding a day or temporary worker, who is paid on an hourly basis, or is not exempt from the minimum wage and overtime compensation requirements of the Fair Labor Standards Act of 1938 and the regulations promulgated thereunder, as amended.

"Sexual assault" means any sexual offense under part V of chapter 707.

"Spouse" means a person who is lawfully married to another person under the laws of the State or is in a civil union.

(b) An employer shall provide paid sick leave annually to each of the employer's service workers. The paid sick leave shall be earned, beginning January 1, 2016, or the date thereafter upon which the service worker commences employment, as follows:

(1) At a rate of at least one hour of paid sick leave for each forty hours actually worked; and

(2) In one-hour increments up to a maximum of forty hours per calendar year.

A service worker shall be entitled to carry over up to forty unused earned hours of paid sick leave from the current calendar year to the following calendar year; provided that no service worker shall be entitled to carry over more than an aggregate of eighty hours of earned sick leave.

(1) If the service worker was hired prior to January 1, 2016, upon the completion of the six-hundred-eightieth hour of employment from January 1, 2016; or

(2) If the service worker was hired on or after January 1, 2016, upon the completion of the service worker's six‑hundred-eightieth hour of employment from the date of hire, unless the employer agrees to an earlier date.

A service worker shall not be entitled to the use of earned paid sick leave if the service worker did not work an average of ten or more hours a week for the employer in the most recent complete calendar quarter.

(d) An employer shall be deemed to be in compliance with this section if:

(1) The employer offers any sick leave or other paid leave, or combination of other paid leave, that may be used for the purpose of subsection (g); and is earned at the greater rate described in subsection (b); or

(2) The employer has a sick leave policy approved by the director.

For the purposes of this subsection, "other paid leave" may include paid vacation, personal days, or paid time off.

(e) An employer shall pay each service worker for paid sick leave at a pay rate equal to the greater of either the normal hourly wage for that service worker, or the minimum wage under section 387-2 for the pay period during which the employee used paid sick leave. For any service worker whose hourly wage varies depending on the work performed by the service worker, the "normal hourly wage" shall mean the average hourly wage of the service worker in the pay period prior to the one in which the service worker used paid sick leave.

(f) Upon the mutual consent of the service worker and employer, a service worker who chooses to work additional hours or shifts during the same or following pay period, in lieu of hours or shifts missed, shall not use earned paid sick leave.

(g) An employer shall permit a service worker to use the paid sick leave earned under this section for the following purposes:

(1) For a service worker's:

(A) Illness, injury, or health condition;

(B) The medical diagnosis, care, or treatment of a mental illness or physical illness, injury, or health condition; or

(2) For a service worker's child's or spouse's:

(A) Illness, injury, or health condition;

(B) The medical diagnosis, care, or treatment of a mental or physical illness, injury, or health condition; or

(h) If a service worker is a victim of family violence or sexual assault, an employer shall permit that service worker to use the paid sick leave earned under this section for the following purposes:

(1) For medical care or psychological or other counseling for physical or psychological injury or disability;

(2) To obtain services from a victim services organization;

(3) To relocate due to the family violence or sexual assault; or

(4) To participate in any civil or criminal proceedings related to or resulting from the family violence or sexual assault.

(i) Unless an employee policy or collective bargaining agreement provides for the payment of earned fringe benefits upon termination, no service worker shall be entitled to payment of unused earned sick leave under this section upon termination of employment.

(j) Nothing in this section shall be construed to:

(1) Prevent employers from providing more paid sick leave than is required under this section;

(2) Diminish any rights provided to any employee or service worker under a collective bargaining agreement; or

(3) Preempt or override the terms of any collective bargaining agreement effective prior to January 1, 2016.

(k) A termination of a service worker's employment by an employer shall constitute a break in employment. If that service worker is subsequently rehired by the employer following a break in employment, the service worker shall:

(1) Begin to earn sick leave in accordance with this section; and

(2) Not be entitled to any unused hours of paid sick leave that had been earned prior to the service worker's break in service unless agreed to by the employer.

(l) An employer shall provide notice to each service worker of the following information:

(1) The entitlement to sick leave for service workers, the amount of sick leave provided to service workers, and the terms under which sick leave may be used; and

(2) That the service worker has a right to file a complaint with the department of labor and industrial relations for suspected violations of this section by the employer.

Employers may comply with this section by displaying a poster that contains the information required by this subsection and that is posted in a conspicuous place, accessible to service workers, at the employer's place of business."

PART III.

SECTION 5. This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun before its effective date.

SECTION 6. New statutory material is underscored.

SECTION 7. This Act shall take effect on July 1, 2059.

HOUSE OF REPRESENTATIVES	H.B. NO.	496
TWENTY-EIGHTH LEGISLATURE, 2015		H.D. 1
STATE OF HAWAII		S.D. 2