State to Pay Settlement After Hawaii Law Ruled Unconstitutional

The state is poised to pay a settlement of nearly $90,000 over a Hawaii law that a federal judge has found to be unconstitutional.

The settlement is part of more than $683,000 the state proposes to pay out to resolve civil lawsuits or claims filed against various state agencies.

The law in question was dubbed the Hawaii “Sick Leave Law,” which was passed by the Legislature and signed by Gov. Neil Abercrombie in 2011. It prohibited certain employers from firing or disciplining workers who were accused of misusing sick leave.

It also prohibited the employers from requiring verification from a physician when an employee used fewer than three consecutive days of sick leave.

Twenty-two employers ranging from hospitals to resorts to supermarkets filed suit in federal court in November 2011 challenging the law.

In 2013, US District Court Judge Susan Oki Mollway issued an order striking down the law after finding that the statute was unconstitutional.

The lawsuit argued that the sick leave law was preempted by federal law, including the National Labor Relations Act which governs collective bargaining actions.

It said sick leave is a mandatory subject of bargaining under the Act and the businesses’ contracts with unions dictated the terms and conditions of sick leave, including discharges, demotions or withholding of pay related to its use.

The suit said the law improperly made those actions subject to investigation by the state Department of Labor and Industrial Relations and gave the DLIR authority to order reinstatement or back-pay damages to employees affected by the law.

Those actions “interfere with the free play of economic forces and constrains future bargaining between plaintiffs and current labor representatives,” the lawsuit said.

Another criticism of the law was that it was selective in its application, dealing only with businesses with collective bargaining agreements and with more than 100 employees. All of the plaintiffs in the lawsuit met those criteria.

The case is Civil No. 11-00706.

The settlement is in the amount of $89,645.15. According to Richard Rand, one of the Honolulu attorneys representing the 22 companies, that covers the majority of the legal costs incurred by the companies who sued.

The funding is contained in Senate Bill 2246, which was heard today by the Senate Committee on Judiciary and Labor.

Other payments covered by the bill include:

• $50,000 for partial payment of a settlement of a lawsuit filed by a former nurse in the Department of Public Safety who claimed discrimination because of her Filipino ancestry
• $25,000 to settle a lawsuit filed by a pedestrian who claimed that a crosswalk on Oahu’s Kalanianaole Highway was poorly illuminated
• $65,000 to settle a lawsuit filed by a man who tripped on a drainage culvert on sidewalk along a state roadway on Kauai
• A $421,000 check to replace one never received by a man in connection with a 2009 settlement