SB 2526: Hawaii Council of Mayors Package; Retirants; Employment

A BILL FOR AN ACT

RELATING TO EMPLOYMENT OF RETIRANTS.

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

     SECTION 1.  The legislature finds that reemployment of retirees for unique and crucial positions will help stabilize county operations, provide expertise and institutional knowledge, and support workforce training and succession planning.

     Accordingly, the purpose of this Act is to enable the State and counties to temporarily rehire retired public employees in positions identified as unique and critical to government operations.

     SECTION 2.  Section 88-9, Hawaii Revised Statutes, is amended as follows:

     1.  By amending subsection (d) to read:

     "(d)  A retirant may be employed without reenrollment in the system and suffer no loss or interruption of benefits provided by the system or under chapter 87A if the retirant is employed:

     (1)  As an elective officer pursuant to section 88-42.6(c) or as a member of the legislature pursuant to section 88-73(d);

     (2)  As a juror or precinct official;

     (3)  As a part-time or temporary employee excluded from membership in the system pursuant to section 88-43, as a session employee excluded from membership in the system pursuant to section 88-54.2[[],[]] or as any other employee expressly excluded by law from membership in the system; provided that:

          (A)  The retirant was not employed by the State or a county during the six calendar months prior to the first day of reemployment; and

          (B)  No agreement was entered into between the State or a county and the retirant, prior to the retirement of the retirant, for the return to work by the retirant after retirement;

     (4)  In a position identified by the appropriate jurisdiction as a labor shortage or difficult-to-fill position; provided that:

          (A)  The retirant was not employed by the State or a county during the twelve calendar months prior to the first day of reemployment;

          (B)  No agreement was entered into between the State or a county and the retirant, prior to the retirement of the retirant, for the return to work by the retirant after retirement; and

          (C)  Each employer shall contribute to the pension accumulation fund the required percentage of the rehired retirant's compensation to amortize the system's unfunded actuarial accrued liability; [or]

     (5)  As a teacher or an administrator in a teacher shortage area identified by the department of education or in a charter school or as a mentor for new classroom teachers; provided that:

          (A)  The retirant was not employed by the State or a county during the twelve calendar months prior to the first day of reemployment;

          (B)  No agreement was entered into between the State or a county and the retirant prior to the retirement of the retirant, for the return to work by the retirant after retirement; and

          (C)  The department of education or charter school shall contribute to the pension accumulation fund the required percentage of the rehired retirant's compensation to amortize the system's unfunded actuarial accrued liability[.]; or

     (6)  In a position identified by the appropriate jurisdiction as unique and critical to operations; provided that:

          (A)  The retirant was not employed by the State or a county during the twelve calendar months prior to the first day of reemployment;

          (B)  No agreement was entered into between the State or a county and the retirant, prior to the retirement of the retirant, for the return to work by the retirant after retirement;

          (C)  Each employer shall contribute to the pension accumulation fund the required percentage of the rehired retirant's compensation to amortize the system's unfunded actuarial accrued liability; and

          (D)  Notwithstanding section 76-16(b)(17), the retirant hired after June 30, 2026, shall not be reemployed in a position identified as unique and critical to operations for a period exceeding four years in total.  Upon reaching the four-year limit, the retirant shall separate from state or county employment.

     For the purpose of this subsection:

     "Unique and critical to operations" means positions that require a high degree of specialized knowledge and experience."

     2.  By amending subsection (f) to read:

     "(f)  No later than twenty days prior to the convening of each regular legislative session, the director of human resources of the appropriate state jurisdiction or the human resources management chief executive of each county shall submit an annual report to the legislature detailing the employment of retirants under paragraphs (4) [and], (5), and (6) of subsection (d), including the number and positions of retirants."

     SECTION 3.  This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun before its effective date.

     SECTION 4.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 5.  This Act shall take effect on January 1, 2077.

Report Title:

Hawaii Council of Mayors Package; Retirants; Employment

Description:

Authorizes the rehiring of retirants for positions that are unique and critical to operations.  Limits the duration of each retirant's reemployment to four years.  Effective 1/1/2077.  (SD1)

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 employment of retirants.

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

     SECTION 1.  The legislature finds that reemployment of retirees for unique and crucial positions will help stabilize county operations, provide expertise and institutional knowledge, and support workforce training and succession planning.

     Accordingly, the purpose of this Act is to enable the State and counties to temporarily rehire retired public employees in positions identified as unique and critical to government operations.

     SECTION 2.  Section 88-9, Hawaii Revised Statutes, is amended as follows:

     1.  By amending subsection (d) to read:

     "(d)  A retirant may be employed without reenrollment in the system and suffer no loss or interruption of benefits provided by the system or under chapter 87A if the retirant is employed:

     (1)  As an elective officer pursuant to section 88-42.6(c) or as a member of the legislature pursuant to section 88-73(d);

     (2)  As a juror or precinct official;

     (3)  As a part-time or temporary employee excluded from membership in the system pursuant to section 88-43, as a session employee excluded from membership in the system pursuant to section 88-54.2[[],[]] or as any other employee expressly excluded by law from membership in the system; provided that:

          (A)  The retirant was not employed by the State or a county during the six calendar months prior to the first day of reemployment; and

          (B)  No agreement was entered into between the State or a county and the retirant, prior to the retirement of the retirant, for the return to work by the retirant after retirement;

     (4)  In a position identified by the appropriate jurisdiction as a labor shortage or difficult-to-fill position; provided that:

          (A)  The retirant was not employed by the State or a county during the twelve calendar months prior to the first day of reemployment;

          (B)  No agreement was entered into between the State or a county and the retirant, prior to the retirement of the retirant, for the return to work by the retirant after retirement; and

          (C)  Each employer shall contribute to the pension accumulation fund the required percentage of the rehired retirant's compensation to amortize the system's unfunded actuarial accrued liability; [or]

     (5)  As a teacher or an administrator in a teacher shortage area identified by the department of education or in a charter school or as a mentor for new classroom teachers; provided that:

          (A)  The retirant was not employed by the State or a county during the twelve calendar months prior to the first day of reemployment;

          (B)  No agreement was entered into between the State or a county and the retirant prior to the retirement of the retirant, for the return to work by the retirant after retirement; and

          (C)  The department of education or charter school shall contribute to the pension accumulation fund the required percentage of the rehired retirant's compensation to amortize the system's unfunded actuarial accrued liability[.]; or

     (6)  In a position identified by the appropriate jurisdiction as unique and critical to operations; provided that:

          (A)  The retirant was not employed by the State or a county during the twelve calendar months prior to the first day of reemployment;

          (B)  No agreement was entered into between the State or a county and the retirant, prior to the retirement of the retirant, for the return to work by the retirant after retirement;

          (C)  Each employer shall contribute to the pension accumulation fund the required percentage of the rehired retirant's compensation to amortize the system's unfunded actuarial accrued liability; and

          (D)  The retirant shall not be reemployed in a position identified as unique and critical to operations for a period exceeding four years in total.  Upon reaching the four-year limit, the retirant shall separate from the state and county employment."

     2.  By amending subsection (f) to read:

     "(f)  No later than twenty days prior to the convening of each regular legislative session, the director of human resources of the appropriate state jurisdiction or the human resources management chief executive of each county shall submit an annual report to the legislature detailing the employment of retirants under paragraphs (4) [and], (5), and (6) of subsection (d), including the number and positions of retirants."

     SECTION 3.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 4.  This Act shall take effect upon its approval.

Report Title:

Hawaii Council of Mayors Package; Retirants; Employment

Description:

Authorizes the rehiring of retirants for positions that are unique and critical to operations.  Limits the duration of each retirant's reemployment to 4 years.

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. 2535

Honolulu, Hawaii

RE:     S.B. No. 2526

        S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Thirty-Third State Legislature

Regular Session of 2026

State of Hawaii

Sir:

     Your Committee on Labor and Technology, to which was referred S.B. No. 2526 entitled:

"A BILL FOR AN ACT RELATING TO EMPLOYMENT OF RETIRANTS,"

begs leave to report as follows:

     The purpose and intent of this measure is to authorize the rehiring of retirants for positions that are unique and critical to operations and limit the duration of each retirant's reemployment to four years.

     Your Committee received testimony in support of this measure from the Office of the Mayor of the County of Maui, Department of Human Resources of the City and County of Honolulu, Office of the Mayor of the County of Kauaʻi, and one individual.

     Your Committee received comments on this measure from the Department of the Attorney General and Employees' Retirement System.

     Your Committee finds that there is a labor shortage in the State that makes it difficult to fill certain positions in the public sector identified as unique and critical to government operations.  Your Committee also finds that hiring retirants who are qualified and trained for these positions allows vacancies to be filled more efficiently.  This measure facilitates the rehiring of retirants in positions identified by the appropriate jurisdictions as unique and critical to government operations by allowing rehiring to occur without reenrollment in the Employees' Retirant System or a loss or interruption of benefits.

     Your Committee acknowledges the concerns raised in testimony by the Department of the Attorney General that there may be uncertainty regarding the treatment of a retirant rehired and compliance with Chapter 76, Hawaii Revised Statutes, relating to the Civil Service Law.  Therefore, amendments to this measure needs to be amended to address these concerns.

     Accordingly, your Committee has amended this measure by:

     (1)  Inserting language to clarify that notwithstanding section 76-16(b)(17), Hawaii Revised Statutes, a retirant hired after June 30, 2026, shall not be reemployed in a position identified as unique and critical to operations for a period exceeding four years in total and upon reaching the four-year limit, the retirant shall separate from state or county employment;

     (2)  Defining the term "unique and critical to operations" as a position that requires a high degree of specialized knowledge and experience;

     (3)  Inserting a savings clause;

     (4)  Inserting an effective date of January 1, 2077, to encourage further discussion; and

     (5)  Making technical, nonsubstantive amendments for the purposes of clarity and consistency.

     As affirmed by the record of votes of the members of your Committee on Labor and Technology that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 2526, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 2526, S.D. 1, and be referred to your Committee on Ways and Means.

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