Bill Text: HI HB2346 | 2012 | Regular Session | Introduced
Bill Title: Professional Employer Organizations
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2012-02-09 - (H) The committee(s) on ERB recommend(s) that the measure be deferred. [HB2346 Detail]
Download: Hawaii-2012-HB2346-Introduced.html
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HOUSE OF REPRESENTATIVES |
H.B. NO. |
2346 |
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TWENTY-SIXTH LEGISLATURE, 2012 |
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STATE OF HAWAII |
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A BILL FOR AN ACT
relating to professional employer organizations.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. Chapter 373L, Hawaii Revised Statutes, is amended by adding two new sections to be appropriately designated and to read as follows:
"§373L- Professional employer organization; employee rights; payroll cost exemption. (a) Where any client company uses the services of covered employees and co-employs covered employees with a professional employer organization, the client company and the professional employer organization, with respect to the covered employees, shall not be exempt from the requirements of any federal, state, or county law, including labor or employment laws, collective bargaining rights, anti-discrimination provisions, or other laws with respect to the protection and rights of employees, including chapters 377 and 378, that would apply to the covered employees if the covered employees were employees of the client company alone, and were not co-employees of the professional employer organization.
These employee rights shall not be abrogated by any contract or agreement between the client company and the professional employer organization, or the professional employer organization and the covered employee, that contains terms or conditions that could not be lawfully contained in a contract or agreement directly between the client company and the covered employee in which no professional employer organization is involved. Notwithstanding any statute, local ordinance, executive order, rule, or regulation to the contrary, where the laws, rights, and protections referred to in this section define or require a determination of the "employer", the employer shall be deemed to be the client company and not the professional employer organization. The department of labor and industrial relations shall notify the department of taxation in writing of any violation of this subsection.
(b) The client company shall be deemed to have satisfied its obligations with respect to any covered employee under any applicable law, including, without limitation, workers' compensation laws including chapter 386, employee insurance coverage laws including chapters 383, 385, 392, and 393, and tax withholding and reporting laws, if and to the extent that those obligations are satisfied by the professional employer organization acting in its capacity as co-employer of the covered employee.
(c) Amounts received by a professional employer organization from a client company in amounts equal to, and that are disbursed by, the professional employer organization for employee wages, salaries, payroll taxes, insurance premiums, and benefits, including retirement, vacation, sick leave, health benefits, and similar employment benefits with respect to covered employees at a client company shall not be subject to the general excise tax as provided by section 237-24.75.
(d) The general excise tax exemption under section 237‑24.75 shall not apply to the professional employer organization if:
(1) By or through any contract between the client company and any professional employer organization, or otherwise, employees are excluded from any employee rights or employee benefits required by law to be provided to employees of the client company by the client company; or
(2) The professional employer organization fails to pay any tax withholding for assigned employees or any federal or state taxes for which the professional employer organization is responsible.
§373L- Professional employer organization special fund. There is established the professional employer organization special fund into which shall be deposited the registration fees collected under section 373L-2 and any interest earned or accrued on moneys in the special fund. The proceeds of the special fund shall be used by the director for administering and enforcing the chapter."
SECTION 2. Section 237-24.75, Hawaii Revised Statutes, is amended to read as follows:
"§237-24.75 Additional exemptions. In addition to the amounts exempt under section 237-24, this chapter shall not apply to:
(1) Amounts received as a beverage container deposit collected under chapter 342G, part VIII;
(2) Amounts received by the operator of the Hawaii
convention center for reimbursement of costs or advances made pursuant to a
contract with the Hawaii tourism authority under section 201B‑7[[];
and[]
[](3) Amounts received[]] by a
professional [employment] employer organization from a client
company equal to amounts that are disbursed by the professional [employment]
employer organization for employee wages, salaries, payroll taxes,
insurance premiums, and benefits, including retirement, vacation, sick leave, health
benefits, and similar employment benefits with respect to assigned employees at
a client company; provided that this exemption shall not apply to a
professional [employment] employer organization upon failure of
the professional [employment] employer organization to collect,
account for, and pay over any income tax withholding for [assigned] covered
employees or any federal or state taxes for which the professional [employment]
employer organization is responsible. As used in this paragraph,
"professional [employment] employer organization",
"client company", and ["assigned employee"] "covered
employee" shall have the meanings provided in section [373K-1.]
373L-1."
SECTION 3. Chapter 373K, Hawaii Revised Statutes, is repealed.
SECTION 4. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.
SECTION 5. This Act shall take effect on July 1, 2012.
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INTRODUCED BY: |
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Report Title:
Professional Employer Organizations
Description:
Consolidates laws regarding professional employer organizations. Establishes professional employer organization special fund into which registration fees are to be deposited.
The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.
