HOUSE OF REPRESENTATIVES
TWENTY-NINTH LEGISLATURE, 2017
STATE OF HAWAII
A BILL FOR AN ACT
RELATING TO LABOR.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. Section 386-123, Hawaii Revised Statutes, is amended to read as follows:
"§386-123 Failure to give security for
compensation; penalty; injunction[
.]; stop-work order; fines.
(a) If an employer fails to comply with section 386-121, or fails to
comply with section 386-99, the director
or the director's designee shall provide the employer with written notice
requiring the employer to provide evidence, satisfactory to the director or
director's designee, of having secured any necessary insurance or
self-insurance in accordance with section 386-121 within three business days.
If an employer fails to provide evidence of insurance or self-insurance within
three business days, the director or the director's designee shall issue and
serve the employer a stop-work order that prohibits the use of employee labor
by the employer until the employer is in compliance with section 386-121. The
stop-work order shall become effective immediately upon service. Any employee
who is affected by the work stoppage shall be paid by the employer for the time
lost, not to exceed ten days, pending compliance by the employer.
(b) An employer may protest a stop-work order by making and filing with the director a written request for a hearing within twenty days after service of the stop-work order. The hearing shall be held within thirty days from the date of filing the request. The director shall notify the employer of the time and place of the hearing by mail. At the conclusion of the hearing, the stop-work order shall be affirmed or dismissed, and within three hours after the hearing, the director shall issue a written decision to all parties by registered or certified mail. If any party is aggrieved by the decision of the director or the designated hearings officer, the party may appeal in the manner provided in chapter 91 to the circuit court after filing a surety bond or letter of credit with the director in an amount equal to ten per cent of the penalty amount; provided that the operation of a stop-work order shall not be stayed on appeal unless specifically ordered by a court of competent jurisdiction in accordance with section 91-14(c).
(c) At the
time the stop-work order is issued and served pursuant to this section, the
director or the director's designee shall also issue and serve a penalty requiring
the employer [
shall be liable for] who violates section
386-121 to pay a penalty of not less than $500 or of $100 for each employee
for every day [ during which such failure continues,] the employer is
not in compliance, whichever sum is greater, to be recovered in an action
brought by the director or the director's designee in the name of the
State, and the amount [ so] that is collected shall be paid into
the special compensation fund created by section 386-151. The director may,
however, in the director's discretion, for good cause shown, remit all or any
part of the penalty in excess of $500; provided that the employer in default
complies with section 386-121. With respect to such actions, the attorney
general or any county attorney or public prosecutor shall prosecute the same if
so requested by the director.
In addition, if any employer is in default
under section 386-121 for a period of [
thirty] fourteen days, the
employer may be enjoined, by the circuit court of the circuit in which the employer's
principal place of business is located[ ,] or the circuit where the
violation occurred, from carrying on the employer's business anywhere in
the State so long as the default continues, such action for injunction to be
prosecuted by the attorney general or any county attorney if so requested by
(d) Stop-work orders and any penalties imposed shall be effective against any successor entity that has one or more of the same principals or officers as the corporation, association, partnership, limited liability company, sole proprietorship, or other legal business entity against which the stop-work order was issued."
SECTION 2. Chapter 388, Hawaii Revised Statutes, is amended by adding three new sections to part I to be appropriately designated and to read as follows:
"§388-A Order of wage payment violation; appeal. (a) When the department of labor and industrial relations, as a result of the department's own investigation, finds that a violation of this chapter or administrative rules adopted under this chapter has been committed and not corrected, or a penalty under section 388-10(a)(2) has not been paid, the department shall issue an order of wage payment violation to the employer in violation. The order shall include any penalty assessed pursuant to section 388-10(a).
(b) The order of wage payment violation shall be final and conclusive unless within twenty days after a copy of the order of wage payment violation has been sent to the employer, the employer files a written notice of appeal with the director in writing.
(c) A hearing on the written notice of appeal shall be held pursuant to chapter 91, by a hearings officer appointed by the director, within thirty days of the filing of the notice of appeal. A decision stating the findings of fact and conclusions of law shall be rendered by the hearings officer within thirty days after the conclusion of the hearing.
(d) Any party to an appeal under this chapter may obtain judicial review of the decision issued by the hearings officer in the manner provided under chapter 91.
§388-B Remittance of penalties. Until the order of wage payment violation becomes final, the director may withdraw or modify the order of wage payment violation or remit all or any part of a penalty assessed if good cause is shown; provided that the employer in default complies with this chapter and the administrative rules adopted under this chapter.
§388-C Enforcement of the order of wage payment violation. The director may file in the circuit court in the jurisdiction in which the employer does business, a certified copy of the final order of wage payment violation. The court shall render a judgment in accordance with the final order of wage payment violation and notify the parties of the judgment. The judgment shall have the same effect, and all proceedings in relation to the judgment shall be the same, as though the judgment had been rendered in an action duly heard and determined by the court, except that there shall be no appeal from the judgment."
SECTION 3. Section 388-10, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:
"(a) Civil. Any employer who fails to
pay wages in accordance with this chapter without equitable justification or
violates this chapter or the administrative rules adopted under this chapter
shall be liable [
(1) To the employee[
, in addition to
the wages legally proven to be due,] for a sum equal to the amount of
unpaid wages and interest at a rate of six per cent per year from the date that
the wages were due[ .]; and
(2) For a penalty of not less than $500 or $100 for each violation, whichever is greater. The penalty shall be deposited into the general fund."
SECTION 4. 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 5. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.
SECTION 6. This Act shall take effect on January 7, 2059.
Stop-work Orders; Workers' Compensation; Order of Wage Payment Violation; Establishment; Enforcement; Penalties
Authorizes the Director of Labor and Industrial Relations or the Director's designee to issue and serve on an employer a stop-work order prohibiting the use of employee labor by the employer until the employer complies with certain provisions regarding security for payments of workers' compensation coverage for employees. Authorizes the Department of Labor and Industrial Relations to issue an order of wage payment violation to the employer in violation of provisions regarding payment of wages and other compensation. Establishes penalties, enforcement, and protest procedures related to stop-work orders and orders of wage payment violations. Takes effect 1/7/2059. (SD1)
The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.