Senate Standing Committee on Labor and Technology

Okay. Good afternoon. The Committee on Labor and Technology has a 3 p.m. agenda. It's Wednesday, March 12th. We're in Conference Room 224, Hawaii State Capitol. Okay. This meeting is being streamed live on YouTube. The unlikely event that we have to abruptly end this hearing due to technical difficulties.

The committee will reconvene to discuss any outstanding business at 3:06 p.m. on March 14 in room 224, and a public notice will be posted on the legislature's website. There is a one-minute testimony limit, so when you hear a bell. Okay. Please wrap it up. Thank you. Okay. Up first, we have House Bill 202, House Draft 1.

This is relating to the adequate reserve fund. Amends the definition of adequate reserve fund for calendar years 2026 and thereafter. And joining us is Senator Fevella. Up first, we have Department of Labor Industrial Relations, Director Butai.

Good afternoon, Chair Aquino, Senator Fevella. I'm Jade Butay representing Department of Labor and Industrial Relations. Thank you, Vice Chair Lee. Thank you, Chair, for hearing this measure that the department strongly supports. This measure safeguards the health and long-term stability of the Unemployment Insurance, Insurance Trust Fund. Thank you.

Okay, thank you very much. Okay. Up next, we have HFIA, Lauren Zirbel, on Zoom.

Thank you very much, director. Up next, we have Tax Foundation of Hawaii, Tom Yamachika, on Zoom.

Not available on Zoom, Chair.

Also not available on Zoom, Chair.

Okay, thank you very much. Okay. And we have a Grassroot Institute of Hawaii in opposition. Any others wishing to testify? House Bill 202. Okay, seeing none. Colleagues, any questions? I have a quick question for the department. Thank you, director, as well as our UI administrator. Thank you for joining us.

So, director, we had spoken briefly about this earlier and just wanted to ask what's the justification for this, and is the timing appropriate considering everything that's happening right now?

Well, you know, I mean, you know, if you think about it, you know, we've been living in, you know, talk about, you know, 100 year blood or black, black swan event like the, you know, the COVID pandemic and then, you know, the Maui wildfires.

And then of course, the multitude of challenges, you know, with this new administration, where every day is like a new day. I mean, it's, you know, to be honest with you, it's like the deja vu when, you know, during dealing with the pandemic, where, you know, we always have to constantly pivot.

So the, you know, the justification is we, you know, we have to be mindful of the, you know, the solvency of the, you know, the trust fund because, you know, nobody knows what's, you know, what's going to happen in the future. You know, we try to, you know, be responsible and try to see what could go wrong.

And I think it would be naive for us if we think that, you know, nothing won't.

And because, you know, when you, if you look at, you know, prior to the pandemic, I mean we had, you know, if you look at the, you know, the statutory date of calculation, the ending of the ending of November or December 2019, we had a balance of about 600 million.

You know, our balance now is about 683 million. But you know, when, you know, that pandemic, you know, that money ran out because at the end of that year we, we had a negative 668 million. And then we had to, you know, we had to borrow like 706 million.

So you, you know, you think, you know, we have a healthy balance now, but that, you know, if it's, we have another one of these, you know, unexpected events, the 600 ending balance that we currently have, it's not going to last that long.

Okay, thank you very much.

Yes.

How much of, how much of this is federal, federal fund? Is this all state?

So this is like business, any kind of businesses like that?

Just the employer?

Senator Fevella.

This is the trust fund. This is the trust fund's. So it comes from the employer.

Yes.

I guess the concern was that this product was that this might, I mean like everything else. Right. They say cost of everything going to go up. You know that. But if there is a minimum wage. Anyway, that's another subject.

The reason, the reason why I bring this up is because, you know, I guess in 2010 we had a balance negative of impact change of multiple multi-pillar to suffer. So why it makes us. I guess it wasn't correct in the last, I guess 10 years. Is this part of that trying to correct all the department?

Let me bring. And she's our administrator, she would have more.

Yeah, let me read the question better because I'll mumble over the whole thing anyway. So to, you know. DLIR 2010, the UCTF violence was negative impacted by the change in the multi-pillar. So why nothing was done in 10 years.

So, good afternoon Chair Aquino, Vice Chair Lee, and Senator Fevella. Thank you for the question. So in 2010.

Sorry Anne, for the record, can you just introduce yourself and your role at DLIR please.

My name is Anne Pereira-Eustaquio. I'm the UI administrator. In 2010, the Legislator took action and changed the adequate reserve percentage from one point five percent to one percent of adequacy.

So initially when the calculation was formulated, it was determined by those who were working on that calculation, as well as USDOL, that stated that one point five percent would be the amount that would take us through a time such as the pandemic. But in 2010, when it was dropped to one percent, it dropped our adequacy.

And so now we're looking at post-pandemic. We see that if we had kept it at one point five percent, we would have fared the Unemployment Insurance Trust Fund levels much better. We wouldn't have had to borrow 700 million from USDOL to pay out benefits and then recalculate that fund balance so that we could continue to survive.

And so we would like to bring it back up to one point five percent. But what happens is when you bring it up to one point five percent, it doesn't mean the rate's going to be on a high scale level, which is we have eight tax schedules when it starts to stabilize.

So, currently we are at schedule C, and projections show that if we stay at the same trajectory, we'll continue to stay at schedule C even though we bring it up to one point two five and then eventually to one point five.

Prior to that it was okay when it was the one point five.

Yes, we were okay. Of course, we didn't experience a pandemic-like incident, but we would have definitely fared better with the one point five adequacy. Also, because of the statute that was passed to remove the anomaly period for the pandemic, we know that we're not overly charging employers using that pandemic period, high unemployment insurance rates.

So during the pandemic I know to witness the high volume of fraud. Did we ever recover any of the.

We did. We recovered. We have recovered some. We've also had court cases to help us recover fraud as well. And we've implemented lots of different fraud tools to help us combat fraud moving forward.

Thank you, Chair. Appreciate that.

Thank you.

Thank you very much.

Okay, let's move on to the next measure. House Bill 477, House Draft 1 relating to the Hawaii Employment Security Law. Okay, first we have Department of Labor Industrial Relations Director.

Vice Chair and Senator Favella, Jade Butay [unintelligible]. Thank you, Chair, for hearing this measure that the Department strongly supports this measure supports the modernization of the UI system while also improving services. And you know, we're respectfully requesting amendments to clarify the intent of the bill. Thank you.

Okay, thank you, Director. Up next, we have yopat District Council 50, Jeffrey Masasugu and support. Any others wishing to testify? House Bill 477, House Draft 1. Okay, seeing none. Any questions, colleagues? Okay, seeing none. Let's move on to the next measure. House Bill 1026, House Draft 1. This is making emergency appropriations for public employment cost items.

Okay, we have BNF Director and support. We have UH System Albert Young. Okay, we have United Public Workers.

Chair Aquino, Vice Chair Lee, Senator Favella, Comic Con Account Law, Government Affairs Manager for United Public Records. You have our testimony. Strong support of this bill. And in the interest of time, we will also stand on our Testimony support for 1027 as well as 1036. Thank you.

I apologize. We do have UH in the House. I was just looking for a Calber. Sorry, Mr. Ng, but go ahead.

Aloha. Senators Michael Ng from the University of Hawaii, uh, stands on his testimony in support of this measure, 1026. We also stand on our support for 1027, 1028, 1029, 1030, 1033, 1034, 1035 and 1036. Thank you very much.

Okay, up next, we have HGA.

Chair, Vice Chair, Members, Newey Sebastian with HGA. I will stand on our testimony and support. We'll also stand on our testimony and support for. For the various other cost item measures that we submitted. Thank you.

Okay, thank you very much. We have Everett Chu. HHSC also in support. Any others wishing to testify? Seeing none. Any questions? Seeing none. Let's move on to the next measure. House Bill 1027, House Draft One. Okay, this is for collective bargaining, unit one.

We have testimony in support from DNF Director as well as, UH, United Public Records and HHSC. Okay, any others wishing to testify? Yes, seeing none. Any questions? Seeing none. Let's move on to the next measure. House Bill 1028. House draft one. Collective bargaining for unit two.

Okay, again, it's gonna sound like a broken record, but please bear with me. Yeah, like this. Okay, again, we have BNF Director. Okay. Uh, HGA and HHSC. Okay. All in support. Any other specialty to testify? Okay, seeing none. Any questions? Seeing none. Let's move on to the next measure. House Bill 1029, House Draft 1.

This is collective bargaining for Unit 3. Okay, again, Budget and Finance Director. Uh, HGA and HHSC all in support. Any others wishing to testify? Okay, seeing none. Members, questions. Moving on to the next measure. Hospital. 10:30, house draft one. Collective bargaining for unit four. DNF Director UH excuse me. SGA and HHSC all in support.

Any others wishing to testify? Seeing non questions. Seeing on this. Move on to House Bill 1031 House Draft One. Collective bargaining for unit five. First we have BNF Director in support. And we have HSTA also in support. Any others wishing to testify? Signan. Any questions? Signan. Moving to hospital 1032. Collective bargaining for unit six. Okay.

First we have VNF Director and HGA both in support. Any others wishing to testify? Okay. Seeing none. Questions? Seeing none. Moving on to House Bill 1033. House draft one. Collective bargaining for unit seven. We have UH in support. And BNF Director also in support, as well as UPA. Thank you very much. In support.

Any others wishing to testify? None. Moving to hospital 1034. House draft one. Collective bargaining for unit eight. We have BNF Director in support, UH as well as HGA. Again, all in support. Any others wishing to testify? Okay. Seeing none. Any questions? Let's move on to House Bill 1035. House Draft Fund collective bargaining for unit nine.

Okay, we have BNF Director, uh, system HGA and HHSC all in support. Any others wishing to test by Seeing none. Any questions? Colleagues? Seeing none. Moving on to hospital 1036. House draft one. Collective bargaining for unit 10. We have BNF Director, UH, and United Public Workers all in support. Any others wishing to testify? Excuse me.

We also have testimony from HHSC in support. Any others wish you to testify? Seeing none. Questions? Okay. Seeing none. Let's move on to the next measure. Hospital 1037, collective bargaining for unit 11. Testimony and support from VNF Director. Any others wishing to testify? Seeing none. Members, any questions? Seeing none. Moving to hospital 1038. House Draft One.

Collective bargaining for unit 13. Okay, we have BNF Director in support. HGA support. Okay, we have HHSC in support and a Brian Revelle in opposition. Okay. Any other specialty Testify? Seeing none. Any questions, Members? Colleagues? Seeing none. Moving on to the very last measure. House Bill 1039. House Draft 1. Collective bargaining for unit 14.

We have BNS Director in support and HGA in support. Any other specialty? Testify. Seeing none. Members, we're gonna roll right into. Okay. And promptly after this, we're going to go straight into our 301 decision making only agenda. Okay? So please don't leave. Thank you very much, colleagues. Okay.

Of course, we have House Bill 202, House Draft 1 relating to the adequate Reserve Fund Members. The recommendation is to move this as a Senate draft one with some technical amendments and defective date. We're Going to also add in the Committee report there are some concerns regarding impact to businesses.

But I believe that DLIR had mentioned that the schedules will probably remain the same even after the enactment of this Bill. Okay, but we're still going to include that in the Committee report. Okay. Any questions or concerns? Colleagues? Seeing None.

[Roll call]

Okay, thank you very much, colleagues. Moving on to House Bill 477, House Draft 1 relating to the Hawaii Employment Security Law Members, the recommendation is to move this as a Senate draft one with some technical amendments. We're going to defect the date to July 1, 2050.

We're going to take the amendments requested by Department of Labor Industrial Relations regarding register for work or registration for work. Those definition amendments requested. Any questions or concerns seeing? None.

[Roll call]

Okay, thank you very much. Okay, so for the remaining agenda. Okay, we're gonna take it up on one vote. Okay, so House Bill 1026. These are all the collective bargaining bills as well as the emergency appropriation Bill.

So From House Bill 1026, House Draft 1, House Bill 1027, House Draft Fund, House Bill 1028, House Draft 1, House Bill Ten29, House Draft 1, House Bill Ten30, House Draft 1, House Bill 1011, House Draft 1 HB 1032 House Draft 1, House Bill 1033 House Draft 1, House Bill 1034, House Draft 1, House Bill1035 House Draft Fund, House Bill 1036, House Draft 1, House Bill, House Bill 1037, House Draft 1, House Bill 1080, House Draft 1 and House Bill 1039, House Draft 1.

The Recommendation Colleagues, is to move this as a Senate Draft One. We're going to be defecting the defective date Once more to July 1, 2050 for further discussion. Any questions or concerns seeing none. Vice Chair, thank you.

Voting on House bills all together in one motion. 1026, House Draft 1 through House Bills 1026, 1027, 1028, 1029, 1030, 1031, 1032, 1033, 1034, 35, 36., 37, 38 and 39. All constraints. One recommendation is to pass all of them with amendments. Speeding. Senator Moriwaki excused. Are there any other reservations or nos if not said measures are adopted.

Okay, thank you very much. This concludes our 3:00 pm agenda. It can we go in for the 301 Committee on Labor and Technology convening our 301 decision making only agenda? It is still Wednesday, March 12th. We're still in room 224, Hawaii State Capitol.

These bills were previously heard on Monday, March 10th in the same conference room at 3pm okay, up first we have House Bill 423, House Draft Two getting to workers compensation. Members.

The recommendation is to move this as a Senate Draft 1 with a defective date of 07-01-2050, some technical amendments and we're also going to be taking De Herd's amendments to amend.

Verbiage on page seven, lines 12 to 18 it should say that a provider shall file the employee is planned with the approval of the employee no later than 90 days after the provider submits an initial evaluation report unless the employer, provider and injured worker agree to an extension of that deadline to a specific date by which the vocational plan must be completed.

Upon receipt of the plan from the provider, an employee shall have 10 days to review and sign the plan. The plan shall be submitted to the employer and the employee and filed with the Director of De Herd within two days from the date of the employee's signature.

A plan shall include a statement of the feasibility of the vocational goal using the process of and so on and so forth. That's in the current measure. Okay, so that's the recommendation. Colleagues, any questions or concerns seeing none. Vice chair vote.

[Roll call]

Okay, thank you very much Members. Moving on to House Bill 480 House Draft Fund again relating to workers compensation Members, the recommendation is to move this as a Senate draft Fund with some technical amendments and a new defective date of 07-01-2050. Okay, any questions or concerns? Seeing none. Vice Chair for the vote voting on.

House Bill 480 House draft one recommendation to pass with amendments noting Senator Murray walking excused. Are there any reservations or nos? Seeing none the recommendations adopted.

Okay, thank you very much colleagues. Moving on to House Bill 162 House Draft 2 related to collective bargaining.

This would authorize the Labor Relations Board to request the Federal mediation and Conciliation service to furnish a list of five qualified and experience experienced interest arbitrators in the event the parties fail to select the neutral third Member of the arbitration panel clarifies that this is another organization that the HLRB can select from and not just the Ama, the American Arbitration aaa, American Arbitration Association.

Okay, so Members, the recommendation is to move this as a Senate draft Fund with some technical amendments and a new defective date of July 1, 2050. Okay, any questions or concerns seeing that Vice Chair for the vote, please.

Voting on House Bill 162, House Draft 2, the recommendations to pass with amendments noting Senator Moriwaki excused. Are there any reservations or nos. Seeing none the recommendations adopted.

Okay, thank you very much, colleagues. Okay, moving on to House Bill 164 relating to indebtedness to the state. Okay, Members, the recommendation of this bill is to move this as a Senate draft one with some technical amendments, a defective date of July 1, 2050 and we're also going to be taking HGA's amendments. Okay, any questions or concerns?

Seeing none.

Vice Chair foot of old voting on. House Bill 164 HD1, the recommendations to pass with amendments noting Senator Moriwaki excused. Are there any reservations or nos. Seeing none the recommendations adopted.

Okay, thank you very much, colleagues. Moving on to House Bill 1152 relating to tax Administration. Okay, Members of recommendation For House Bill 1152, House Draft 1 is to move this as a Senate Draft 1, again with technical amendments and a new Defective date of July 1, 2050. Any questions or concerns see none.

Vice Chair Voting on House Bill 1152, House Draft 1, the recommendations to pass with amendments noting Senator Moriwaki excused. Are there any reservations or nos. Seeing none the recommendations adopted.

Okay, thank you very much, colleagues. Moving on to hospital. 214 House draft one. Okay. Related to government. Okay, for this one, colleagues, the recommendation is to move this as a Senate draft one with some technical amendments. New defective date of July 1, 2050.

Also going to be taking AG's amendments on page six, lines 10 to 11 to cross reference to the portion of the bill addressing school resource officers should it be deemed appropriate.

In addition to that, we're going to be replacing the text on page 1, lines 8 through 11, with the following the Legislature further finds that there is a labor shortage that makes it difficult to fill investigator positions in the Department of the Attorney General and law enforcement officer positions that can be stationed at public schools as school resource officers.

In addition to that on page four, line 15, replace as a school resource officer with as a law enforcement officer.

We're also going to be adding new subparagraphs to Section 889 subsections D subsection 6 by making the following following revisions on page 5 line 4 delete and page 5 line 9 replace or with and we're also going to be adding a new subparagraph D on page five line nine to read as the retirement will be stationed at a public school as a resource officer.

Any questions or concerns Members?

Yes, this is Lauren Foster then retired to be resource officers at the school.

Yes, that's, that's a possibility should this measure pass but there are further concerns regarding this bill but we feel that due to the number of vacancies and the difficulties to get people filled build in these positions trained up that we would like to continue to have this bill moving forward for further discussion what.

I had suggested prior to this we have school research offices. I talked to law enforcement creation of law enforcement.

What had happened was we wanted to have when I discussed this we wanted to have at the time was sheriff before law enforcement at every elementary school and we understand the shortage but idea was since law enforcement came in chair to train the physical and able research officers that we have at the school to come back to the school especially to the community that they represent to have a higher increase in pay and maybe of course a different union.

Right. And have an opportunity to serve that way. Because right now we get these officers that can be retired.

We're taking nothing away from them and understand the shortage but how can we have our community school resource officers that been there never have an opportunity to move up and now we get law enforcement that was they told me that they're willing to train them, go through the training, get certified and everything and they leave school as a research officer and coming back as law enforcement to help with the shortage that we have.

So I, I, I know I wasn't here for that discussion but that's something that I would like to put in the notes if anything going forward. It is done.

Okay.

Thank you very much, sir.

No very much welcome. Any other questions or concerns or comments colleagues? Seeing None.

Vice Chair [unintelligible] voting on House Bill 214 HD1 the recommendations to pass with amendments noting Senator Moriwaki excused. Are there any reservations or nos. Seeing none, the recommendations adopted.

Thank you very much colleagues. Moving on to the next measure, House Bill 874 House Draft 3 relating to child performers.

This amends the Uniform Custodial Trust act to specify that for a minor in theatrical employment with a gross income of at least 5,000 on a project or 20,000 in a calendar year, a parent or legal guardian of the minor is required to establish a trust account for the minor with an independent third party trustee and the employer of the minor is required to deposit a portion of the minor's earnings into the trust account until the minor becomes an adult.

And it also makes misappropriation or fraudulent use of funds within the trust account of breach of fiduciary duty, subject to certain penalties. Members, the recommendation is to move this as a Senate draft. One, we're going to add some technical amendments with a defective date of July 1, 2050.

In addition to that, we're going to be placing the responsibility of this particular portion of the bill to be overseen by the Department of Labor Industrial Relations, specifically the Wage Standards Division, which already oversees a lot of our child, child labor laws and regulations. Yeah. Any questions or concerns, colleagues? Sing none.

Vice Chair for the vote, voting on.

House Bill 874, House Draft 3, the recommendations to pass with amendments noting Senator Murray Watt, the excused. Are there any reservations or no's? Seeing none of the recommendations.

Thank you very much, colleagues. And moving on to the very last measure, House Bill 159, House Draft 1 related to qualified community rehabilitation programs. Members, the recommendation is to move this as a Senate draft one with some technical amendments. We're going to again change the defective date to July 1, 2050.

And we're also going to blank the $850,000 cap at the moment for further discussion. Any questions or concerns? Seeing none.

Vice Chair Foot of old voting on. House Bill 159, House Draft 1, the recommendations to pass with amendment noting Senator Moriwaki. Excused. Are there any reservations or nos? Seeing none, the recommendations adopted.

Okay, thank you very much.

We're adjourned. Thank you.