HB 90: RELATING TO PUBLIC EMPLOYEE COMPENSATION.

A BILL FOR AN ACT

RELATING TO PUBLIC EMPLOYEE COMPENSATION.

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

     SECTION 1.  Section 78-13, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

     "(a)  Unless otherwise provided by law, all officers and employees shall be paid at least semimonthly except that substitute teachers, part-time hourly rated teachers of adult and evening classes, and other part-time, intermittent, or casual employees may be paid once a month [and that the governor, upon reasonable notice and upon determination that the payroll payment basis should be converted from predicted payroll to after-the-fact payroll, may allow a one-time once a month payroll payment to all public officers and employees to effect a conversion to after-the-fact payroll as follows:

     (1)  The implementation of the after-the-fact payroll will commence with the June 30, 1998, pay day, which will be delayed to July 1, 1998;

     (2)  The July 15, 1998, pay day will be delayed to July 17, 1998;

     (3)  The July 31, 1998, pay day will be delayed to August 3, 1998;

     (4)  The August 14, 1998, pay day will be delayed to August 19, 1998;

     (5)  The August 31, 1998, pay day will be delayed to September 4, 1998;

     (6)  The September 15, 1998, pay day will be delayed to September 18, 1998; and

     (7)  Thereafter, pay days will be on the fifth and the twentieth of every month.  If the fifth and the twentieth fall on a state holiday, Saturday, or Sunday, the pay day will be the immediately preceding weekday.]

; provided that the payroll payment basis shall be converted from after-the-fact payroll to predicted payroll and shall commence with the August 5, 2026, pay day, which shall be paid on July 1, 2026, and thereafter pay days shall be on the fifteenth day and last day of every month.  If the fifteenth day or the last day of the month falls on a Saturday, Sunday, or holiday, the pay day shall be on the immediately preceding weekday.

     The implementation of the [after-the-fact] predicted payroll shall not be subject to negotiation under chapter 89."

     SECTION 2.  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 2025-2026 to establish six full-time equivalent (6.0 FTE) positions to perform tasks related to payroll processing, including training, expanded monitoring and auditing, expanded overpayment analysis, and overpayment collection.

     The sum appropriated shall be expended by the department of accounting and general services for the purposes of this Act.

     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 2025-2026 and the same sum or so much thereof as may be necessary for fiscal year 2026-2027 to pay for the costs necessary to convert employees from an after‑the‑fact payroll schedule to a predicted payroll schedule.

     The sums appropriated shall be expended by the department of accounting and general services for the purposes of this Act.

     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, 3000.

Report Title:

DAGS; Salaries; Public Officers and Employees; Payroll Schedule; Appropriations

Description:

Amends payroll requirements for public officers and employees by requiring them to be paid pursuant to a predicted payroll schedule, rather than an after-the-fact payroll schedule.  Provides that the predicted payroll schedule shall not be subject to negotiation under Chapter 89, HRS.  Appropriates funds.  Effective 7/1/3000.  (HD1)

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.

A BILL FOR AN ACT

RELATING TO PUBLIC EMPLOYEE COMPENSATION.

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

     SECTION 1.  Section 78-13, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

     "(a)  Unless otherwise provided by law, all officers and employees shall be paid at least semimonthly except that substitute teachers, part-time hourly rated teachers of adult and evening classes, and other part-time, intermittent, or casual employees may be paid once a month [and that the governor, upon reasonable notice and upon determination that the payroll payment basis should be converted from predicted payroll to after-the-fact payroll, may allow a one-time once a month payroll payment to all public officers and employees to effect a conversion to after-the-fact payroll as follows:

     (1)  The implementation of the after-the-fact payroll will commence with the June 30, 1998, pay day, which will be delayed to July 1, 1998;

     (2)  The July 15, 1998, pay day will be delayed to July 17, 1998;

     (3)  The July 31, 1998, pay day will be delayed to August 3, 1998;

     (4)  The August 14, 1998, pay day will be delayed to August 19, 1998;

     (5)  The August 31, 1998, pay day will be delayed to September 4, 1998;

     (6)  The September 15, 1998, pay day will be delayed to September 18, 1998; and

     (7)  Thereafter, pay days will be on the fifth and the twentieth of every month.  If the fifth and the twentieth fall on a state holiday, Saturday, or Sunday, the pay day will be the immediately preceding weekday.]; provided that the payroll payment basis shall be converted from after-the-fact payroll to predicted payroll and shall commence with the August 5, 2025, pay day, which shall be paid on July 31, 2025, and thereafter pay days shall be on the fifteenth and last day of every month.  If the fifteenth or the last day of the month falls on a state holiday, Saturday, or Sunday, the pay day shall be on the immediately preceding weekday.

     The implementation of the [after-the-fact] predicted payroll shall not be subject to negotiation under chapter 89."

     SECTION 2.  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 2025-2026 to establish six full-time equivalent (6.0 FTE) positions to perform tasks related to payroll processing, including training, expanded monitoring and auditing, expanded overpayment analysis, and overpayment collection.

     The sums appropriated shall be expended by the department of accounting and general services for the purposes of this Act.

     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 2025-2027 to pay for costs necessary to convert employees from an after‑the‑fact payroll schedule to a predicted payroll schedule.

     The sum appropriated shall be expended by the department of accounting and general services for the purposes of this Act.

     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, 2025.

Report Title:

DAGS; Salaries; Public Officers and Employees; Payroll Schedule; Appropriations; General Fund Expenditure Ceiling Exceeded

Description:

Repeals payroll day for public officers and employees by requiring them to be paid pursuant to a predicted payroll schedule, rather than an after-the-fact payroll schedule.  Provides that the predicted payroll schedule shall not be subject to negotiation under Chapter 89, HRS.  Makes appropriations to establish 6 full-time equivalent positions and to cover the costs of converting to a predicted payroll schedule for 2025-2027.

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.

STAND. COM. REP. NO.  534

Honolulu, Hawaii

                , 2025

RE:   H.B. No. 90

      H.D. 1

Honorable Nadine K. Nakamura

Speaker, House of Representatives

Thirty-Third State Legislature

Regular Session of 2025

State of Hawaii

Madame:

     Your Committee on Labor, to which was referred H.B. No. 90 entitled:

"A BILL FOR AN ACT RELATING TO PUBLIC EMPLOYEE COMPENSATION,"

begs leave to report as follows:

     The purpose of this measure is to:

     (1)  Amend payroll requirements for public officers and employees by requiring them to be paid pursuant to a predicted payroll schedule, rather than an after-the-fact payroll schedule; and

     (2)  Appropriate funds to the Department of Accounting and General Services to establish positions to process and perform tasks related to payroll processing and for costs to convert employees to predicted payroll schedules.

     Your Committee received testimony in support of this measure from the Hawaii Government Employees Association, AFSCME Local 152, AFL-CIO; and United Public Workers, AFSCME Local 646, AFL-CIO.  Your Committee received comments on this measure from the Department of Accounting and General Services.

     Your Committee finds that changing payroll requirements for public officers and employees from after-the-fact to a predicted payroll schedule holds the State and counties accountable to pay their employees in a timely manner.  Your Committee also finds it is a priority for the State to be a responsible employer and maintain the integrity of the payment process for its employees.  Your Committee believes that this measure improves payroll schedules to ensure public officers and employees are paid in a timely manner.

     Your Committee has amended this measure accordingly by:

     (1)  Extending the implementation dates by one year, to provide adequate time for the Department of Accounting and General Services to implement the conversion to predicted payroll schedules;

     (2)  Clarifying that the appropriations for the costs of converting employees to predicted payroll schedules are for fiscal years 2025-2026 and 2026-2027;

     (3)  Changing the effective date to July 1, 3000, to encourage further discussion; and

     (4)  Making technical, nonsubstantive amendments for clarity, consistency, and style.

     Your Committee respectfully requests your Committee on Finance, should it deliberate on this measure, to consider an appropriation amount of $172,000,000 for fiscal years 2025-2026 and 2026-2027 for the Department of Accounting and General Services to implement this change.

     As affirmed by the record of votes of the members of your Committee on Labor that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 90, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 90, H.D. 1, and be referred to your Committee on Finance.

Respectfully submitted on behalf of the members of the Committee on Labor,