Report Title:

Employment; Dislocated Workers; Notification; Penalty



Amends definitions of "closing", "covered establishment", and "employer". Requires employer to notify employees of divestiture. Imposes penalties for failure to notify employees of business closing. (SD1)



S.B. NO.



S.D. 1











relating to employment.





SECTION 1. Section 394B-2, Hawaii Revised Statutes, is amended:

1. By adding a new definition of "divestiture" to be appropriately inserted and to read:

""Divestiture" means the transfer of any covered establishment from one employer to another because of the sale, transfer, merger, and other business takeover or transaction of business interests."

2. By amending the definitions of "closing" and "covered establishment" to read as follows:

""Closing" means the permanent shutting down of all operations within a covered establishment due to the sale, transfer, merger, [and] other business takeover or transaction of business interests [which], bankruptcy, or other close of business transaction that results in or may result it the layoff or termination of employees of a covered establishment by the employer.

"Covered establishment" means any industrial, commercial, or other business entity [which] that employs at any time in the preceding twelve-month period, fifty or more persons."

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

""Employer" means any [person who,] individual or entity that, directly or indirectly, owns, operates, or has a controlling interest in a covered establishment, excluding the State or any political subdivision thereof."

SECTION 2. Section 394B-9, Hawaii Revised Statutes, is amended to read as follows:

"394B-9 Notification[.]; penalty. (a) An employer in a covered establishment shall provide to each employee and the director written notification of a closing, divestiture, partial closing, or relocation at least sixty days prior to its occurrence.

(b) An employer who violates this section shall be liable to each affected employee for an amount equal to back pay and benefits for the period of violation not to exceed sixty days. This liability may be reduced by any:

(1) Wages the employer pays during the notice period; and

(2) Voluntary and unconditional payment not required by a legal obligation.

An employer who fails to provide notice under this section shall be subject to a civil penalty not to exceed $500 for each day of the violation; provided that the employer may avoid the penalty if the employer satisfies its liability to each affected employee within three weeks after the closing, divestiture, partial closing, or relocation. In any suit, the court, in its discretion, may allow the prevailing party a reasonable attorney's fee as part of the costs."

SECTION 3. Section 394B-12, Hawaii Revised Statutes, is amended to read as follows:

"[[]394B-12[]] Civil penalties. [Any] Except as provided in section 394B‑9(b), any employer who fails to conform to the provisions of this chapter shall be liable to each of the employees affected in an amount equal to the value of all their wages, benefits, and other compensation for the three months preceding the closure, divestiture, partial closure, or relocation of the covered establishment."

SECTION 4. This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun, before its effective date.

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

SECTION 6. This Act shall take effect on July 1, 2059.