SB 3292: Employment Classification; Delivery Drivers; Covered Employment

THE SENATE	S.B. NO.	3292
THIRTY-THIRD LEGISLATURE, 2026
STATE OF HAWAII

A BILL FOR AN ACT

 

 

relating to labor.

 

 

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

 

     SECTION 1.  The legislature finds that delivery drivers increasingly perform essential business functions for companies operating in Hawaii, including the transport of packages to consumers.  Many of these drivers are required to complete deliveries within specific or algorithmically determined timeframes and are not permitted to refuse assigned delivery requests without penalty, discipline, or loss of access to work.

     The legislature further finds that these conditions constitute a significant degree of control over the manner and means of work, rendering the classification of such delivery drivers as independent contractors inconsistent with the purposes of Hawaii's employment laws.

     The purpose of this Act is to clarify the employment status of certain delivery drivers under state laws related to workers' compensation, wage and hour, temporary disability insurance, family leave, tax classification of business relationships, and unemployment insurance by establishing conditions under which delivery drivers are deemed employees of the business operating the delivery program.

     SECTION 2.  Chapter 386, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

     "§386-     Delivery drivers; covered employment.  (a)  Notwithstanding any other law to the contrary, for purposes of this chapter, services performed by a delivery driver shall be deemed employment, and the delivery driver shall be deemed an employee of the business that arranges, assigns, or dispatches delivery work, if the delivery driver:

     (1)  Is required to complete deliveries within specified time frames, including time frames established or enforced through algorithmic or automated systems; and

     (2)  Is not permitted, in practice or by policy, to decline assigned delivery requests without incurring penalties, discipline, loss or reduction of compensation, loss of access to work opportunities, deactivation, or any other adverse consequence.

Any agreement, policy, or contractual provision that purports to classify a delivery driver described in this section as an independent contractor shall be void and unenforceable for purposes of this chapter.

     (b)  As used in this section, "delivery driver" means an individual who uses a personal vehicle to deliver packages originating from a warehouse, fulfillment center, or distribution station operated by or on behalf of a business to a customer or end user."

     SECTION 3.  Chapter 387, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

     "§387-     Delivery drivers; covered employment.  (a)  Notwithstanding any other law to the contrary, for purposes of this chapter, services performed by a delivery driver shall be deemed employment, and the delivery driver shall be deemed an employee of the business that arranges, assigns, or dispatches delivery work, if the delivery driver:

     (1)  Is required to complete deliveries within specified time frames, including time frames established or enforced through algorithmic or automated systems; and

     (2)  Is not permitted, in practice or by policy, to decline assigned delivery requests without incurring penalties, discipline, loss or reduction of compensation, loss of access to work opportunities, deactivation, or any other adverse consequence.

Any agreement, policy, or contractual provision that purports to classify a delivery driver described in this section as an independent contractor shall be void and unenforceable for purposes of this chapter.

     (b)  As used in this section, "delivery driver" means an individual who uses a personal vehicle to deliver packages originating from a warehouse, fulfillment center, or distribution station operated by or on behalf of a business to a customer or end user."

     SECTION 4.  Chapter 392, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

     "§392-     Delivery drivers; covered employment.  (a)  Notwithstanding any other law to the contrary, for purposes of this chapter, services performed by a delivery driver shall be deemed employment, and the delivery driver shall be deemed an employee of the business that arranges, assigns, or dispatches delivery work, if the delivery driver:

     (1)  Is required to complete deliveries within specified time frames, including time frames established or enforced through algorithmic or automated systems; and

     (2)  Is not permitted, in practice or by policy, to decline assigned delivery requests without incurring penalties, discipline, loss or reduction of compensation, loss of access to work opportunities, deactivation, or any other adverse consequence.

Any agreement, policy, or contractual provision that purports to classify a delivery driver described in this section as an independent contractor shall be void and unenforceable for purposes of this chapter.

     (b)  As used in this section, "delivery driver" means an individual who uses a personal vehicle to deliver packages originating from a warehouse, fulfillment center, or distribution station operated by or on behalf of a business to a customer or end user."

     SECTION 5.  Chapter 398, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

     "§398-     Delivery drivers; covered employment.  (a)  Notwithstanding any other law to the contrary, for purposes of this chapter, services performed by a delivery driver shall be deemed employment, and the delivery driver shall be deemed an employee of the business that arranges, assigns, or dispatches delivery work, if the delivery driver:

     (1)  Is required to complete deliveries within specified time frames, including time frames established or enforced through algorithmic or automated systems; and

     (2)  Is not permitted, in practice or by policy, to decline assigned delivery requests without incurring penalties, discipline, loss or reduction of compensation, loss of access to work opportunities, deactivation, or any other adverse consequence.

Any agreement, policy, or contractual provision that purports to classify a delivery driver described in this section as an independent contractor shall be void and unenforceable for purposes of this chapter.

     (b)  As used in this section, "delivery driver" means an individual who uses a personal vehicle to deliver packages originating from a warehouse, fulfillment center, or distribution station operated by or on behalf of a business to a customer or end user."

     SECTION 6.  Section 233-1, Hawaii Revised Statutes, is amended to read as follows:

     "§233-1  Certain relationship deemed as that of employer-employee.  (a)  Whenever a person, firm, corporation, or the like, shall engage or continue in this State in the business of selling tangible personal property, and shall cause such property to be distributed to, by, or through representatives, distributors, dealers, salespersons, peddlers, canvassers, carriers, truckers, or the like, the department of taxation may adopt, in the manner provided by law, one or more rules [or regulations] providing that for the purposes of the tax laws administered by the department the group, class, or category of persons or business described therein (to be determined by the department as may be appropriate for the purposes of the particular rule [or regulation]) shall, irrespective of whether the relationship or class of business otherwise would be deemed that of seller and buyer, principal and agent, or master and servant, be deemed to be that of employer and employee; provided that [no]:

     (1)  No rule [or regulation] adopted under this section shall apply to any group, class, or category of persons or business as to which the department shall determine, or it shall be shown:

    [(1)] (A)  That the potential employee has been and will continue to be free from control or direction over the performance of the business or services undertaken by the potential employee[, and also];

    [(2)] (B)  That the business or services are performed outside of all the places of business of the potential employer[,]; and [also]

    [(3)] (C)  That the potential employee is customarily engaged in an independently established trade, occupation, or business of the same nature as that involved in the business or services in which the potential employee is engaged or which the potential employee has undertaken for, with, or at the behest of the potential employer[.]; and

     (2)  Notwithstanding paragraph (1), services performed by a delivery driver shall be deemed employment, and the delivery driver shall be deemed an employee of the business that arranges, assigns, or dispatches delivery work, if the delivery driver:

          (A)  Is required to complete deliveries within specified time frames, including time frames established or enforced through algorithmic or automated systems; and

          (B)  Is not permitted, in practice or by policy, to decline assigned delivery requests without incurring penalties, discipline, loss or reduction of compensation, loss of access to work opportunities, deactivation, or any other adverse consequence.

          Any agreement, policy, or contractual provision that purports to classify a delivery driver described in this section as an independent contractor shall be void and unenforceable for purposes of this chapter.

     (b)  As used in [paragraphs (1), (2), and (3) "potential] this section:

     "Delivery driver" means an individual who uses a personal vehicle to deliver packages originating from a warehouse, fulfillment center, or distribution station operated by or on behalf of a business to a customer or end user.

     "Potential employee" means the person who by [such] rule [or regulation] would be classed as an employee[, and "potential].

     "Potential employer" means the person, firm, corporation, or the like, who by [such] rule [or regulation] would be classed as the employer."

     SECTION 7.  Section 383-6, Hawaii Revised Statutes, is amended to read as follows:

     "§383-6  Master and servant relationship, not required when.  (a)  Services performed by an individual for wages or under any contract of hire shall be deemed to be employment subject to this chapter irrespective of whether the common law relationship of master and servant exists unless and until it is shown to the satisfaction of the department of labor and industrial relations that:

     (1)  The individual has been and will continue to be free from control or direction over the performance of such service, both under the individual's contract of hire and in fact;

     (2)  The service is either outside the usual course of the business for which the service is performed or that the service is performed outside of all the places of business of the enterprise for which the service is performed; and

     (3)  The individual is customarily engaged in an independently established trade, occupation, profession, or business of the same nature as that involved in the contract of service.

     (b)  Notwithstanding subsection (a), services performed by a delivery driver shall be deemed employment, and the delivery driver shall be deemed an employee of the business that arranges, assigns, or dispatches delivery work, if the delivery driver:

     (1)  Is required to complete deliveries within specified time frames, including time frames established or enforced through algorithmic or automated systems; and

     (2)  Is not permitted, in practice or by policy, to decline assigned delivery requests without incurring penalties, discipline, loss or reduction of compensation, loss of access to work opportunities, deactivation, or any other adverse consequence.

Any agreement, policy, or contractual provision that purports to classify a delivery driver described in this section as an independent contractor shall be void and unenforceable for purposes of this chapter.

     (c)  As used in this section, "delivery driver" means an individual who uses a personal vehicle to deliver packages originating from a warehouse, fulfillment center, or distribution station operated by or on behalf of a business to a customer or end user."

     SECTION 8.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 9.  This Act shall take effect upon its approval.

 

INTRODUCED BY:	_____________________________

 

 

Report Title:

Employment Classification; Delivery Drivers; Covered Employment

 

Description:

Clarifies the employment status of certain delivery drivers under state laws related to workers' compensation, wage and hour, temporary disability insurance, family leave, tax classification of business relationships, and unemployment insurance by establishing conditions under which delivery drivers are deemed employees of the business operating the delivery program.

 

 

 

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