Category Archives: Unemployment (HRS 383)

HB 2471 SD1

SUBJECT:  UNEMPLOYMENT, Temporary Redefinition of “Adequate Reserve Fund”

BILL NUMBER: HB 2471 SD1

INTRODUCED BY:  Senate Committee on Labor, Culture and the Arts

EXECUTIVE SUMMARY:   Amends the definition of “adequate reserve fund” to exclude the benefit cost rate from June 2020 through August 2021 effective from 2023 to 2030.  We see this an attempt to stabilize unemployment rates for the years 2023 through 2030 without resorting to artificially setting the rate schedule by statute. Continue reading HB 2471 SD1

SB 3128 SD2

SUBJECT:  UNEMPLOYMENT, Temporary Redefinition of “Adequate Reserve Fund”

BILL NUMBER:  SB 3128 SD2

INTRODUCED BY: Senate Committee on Ways and Means

EXECUTIVE SUMMARY:   Amends the definition of Adequate Reserve Fund for calendar years 2023 through 2030 to exclude the Benefit Cost Rate from June 2020 through August 2021.

We see this an attempt to stabilize unemployment rates for the years 2023 through 2030 without resorting to artificially setting the rate schedule by statute.

SYNOPSIS:  Amends section 383-63, HRS, to provide that effective for the calendar years 2023 through 2030, “adequate reserve fund means an amount that is equal to the amount derived by multiplying the benefit cost rate that is the highest during the ten-year period ending on November 30 of each year by the total remuneration paid by all employers, with respect to all employment for which contributions are payable during the last four calendar quarters ending on June 30 of the same year, as reported on contribution reports filed on or before October 31 of the same year, but shall not include the benefit cost rate from June 2020 through August 2021.

EFFECTIVE DATE:  July 1, 2050.

STAFF COMMENTS:  This is an Administration measure submitted by the department of labor and industrial relations and identified as LBR-04 (22).

State unemployment insurance (SUI) is largely funded by employers.  Most employers are charged tax that depends on two things:  the overall health of the fund into which SUI tax is collected, and the claims history of the employer.  So, an employer with a long history of chargeable claims, for example, will pay more than others.  Also, if there is lots of money built up in the fund then the tax rate goes down for everyone.

The health of the fund determines the proper tax rate schedule.  The schedules are named after a letter of the alphabet, with A the least costly schedule and H the most expensive.  The fund health is measured at the end of the year, and that measurement is used to set the rate for the following year.  Here is a chart of the SUI rate schedule for the past 20 years:

Source:  DLIR Reports compiled by Tax Foundation of Hawaii.

Although the Great Recession of 2008 and related events caused the fund to run out of money and we needed to borrow around $180 million from Uncle Sam, employers were not subjected to the dreaded Schedule H because our lawmakers passed special legislation to control the SUI rates and override the normal formulas for the years 2010 through 2012 (the orange bars in the diagram).  That also happened for 2021, where Act 1, SLH 2021, set the rate at Schedule D for 2021 and 2022.

The change requested in this bill is an attempt to stabilize unemployment rates for the years 2023 through 2030 without resorting to artificially setting the rate schedule by statute.

Digested: 3/12/2022

HB 2471 HD1

SUBJECT:  UNEMPLOYMENT, Temporary Redefinition of “Adequate Reserve Fund”

BILL NUMBER: HB 2471 HD1

INTRODUCED BY:  House Committee on Consumer Protection & Commerce

EXECUTIVE SUMMARY:   Amends the definition of “adequate reserve fund” to exclude the benefit cost rate from June 2020 through August 2021 effective from 2023 to 2030.  We see this an attempt to stabilize unemployment rates for the years 2023 through 2030 without resorting to artificially setting the rate schedule by statute. Continue reading HB 2471 HD1

HB 2469 HD 1

SUBJECT:  UNEMPLOYMENT; Add Another Unemployment Compensation Reserve Fund

BILL NUMBER:  HB 2469 HD 1

INTRODUCED BY:  House Committee on Labor & Tourism

EXECUTIVE SUMMARY:   Establishes an unemployment compensation insolvency special fund to be expended solely to resolve an unemployment compensation trust fund insolvency emergency declared by the Governor. Permits the Governor to declare an unemployment compensation trust fund insolvency emergency and to expend moneys from the fund if the Director of Finance determines that the fund balance is insufficient to meet the State’s obligations. Appropriates moneys into the unemployment compensation insolvency special fund.  Our view is that we already have a rainy-day fund and don’t need another one. Continue reading HB 2469 HD 1

SB 3128 SD1

SUBJECT:  UNEMPLOYMENT, Temporary Redefinition of “Adequate Reserve Fund”

BILL NUMBER:  SB 3128 SD1

INTRODUCED BY: Senate Committee on Labor, Culture and the Arts

EXECUTIVE SUMMARY:   Amends the definition of “adequate reserve fund” to exclude the benefit cost rate from June 2020 through August 2021 effective from 2023 to 2030.  We see this an attempt to stabilize unemployment rates for the years 2023 through 2030 without resorting to artificially setting the rate schedule by statute.

Continue reading SB 3128 SD1

HB 2469 HD 1

SUBJECT:  UNEMPLOYMENT; Unemployment Compensation Trust Fund

BILL NUMBER:  HB 2469 HD 1

INTRODUCED BY:  House Committee on Labor & Tourism

EXECUTIVE SUMMARY:   Establishes an unemployment compensation insolvency special fund to be expended solely to resolve an unemployment compensation trust fund insolvency emergency declared by the Governor. Permits the Governor to declare an unemployment compensation trust fund insolvency emergency and to expend moneys from the fund if the Director of Finance determines that the fund balance is insufficient to meet the State’s obligations. Appropriates moneys into the unemployment compensation insolvency special fund.  Our view is that we already have a rainy-day fund and don’t need another one.

Continue reading HB 2469 HD 1

HB 2471 (SB 3128; HB 2160)

SUBJECT:  UNEMPLOYMENT, Temporary Redefinition of “Adequate Reserve Fund”

BILL NUMBER: HB 2471  (SB 3128; HB 2160)

INTRODUCED BY: HB by YAMASHITA, AQUINO, BELATTI, BRANCO, CLARK, CULLEN, ELI, GATES, HASHEM, HASHIMOTO, HOLT, ICHIYAMA, ILAGAN, JOHANSON, KITAGAWA, LOPRESTI, LOWEN, LUKE, MARTEN, MCKELVEY, MORIKAWA, NAKAMURA, NAKASHIMA, NISHIMOTO, OHNO, ONISHI, QUINLAN, SAIKI, SAYAMA, TAKAYAMA, TAKUMI, TAM, TARNAS, TODD, WILDBERGER, YAMANE       (SB by KOUCHI by request; HB by SAIKI by request)

EXECUTIVE SUMMARY:   Amends the definition of “adequate reserve fund” to exclude the benefit cost rate from June 2020 through August 2021 effective from 2023 to 2030.  We see this an attempt to stabilize unemployment rates for the years 2023 through 2030 without resorting to artificially setting the rate schedule by statute.

Continue reading HB 2471 (SB 3128; HB 2160)

HB 2469

SUBJECT:  UNEMPLOYMENT; Unemployment Compensation Trust Fund

BILL NUMBER:  HB 2469

INTRODUCED BY:  YAMASHITA, LUKE, ONISHI

EXECUTIVE SUMMARY:   Establishes an unemployment compensation insolvency special fund to be expended solely to resolve an unemployment compensation trust fund insolvency emergency declared by the Governor. Permits the Governor to declare an unemployment compensation trust fund insolvency emergency and to expend moneys from the fund if the Director of Finance determines that the fund balance is insufficient to meet the State’s obligations. Appropriates moneys into the unemployment compensation insolvency special fund.  Our view is that we already have a rainy-day fund and don’t need another one.

Continue reading HB 2469

SB 3128; HB 2160

SUBJECT:  UNEMPLOYMENT, Temporary Redefinition of “Adequate Reserve Fund”

BILL NUMBER:  SB 3128; HB 2160

INTRODUCED BY: SB by KOUCHI by request; HB by SAIKI by request

EXECUTIVE SUMMARY:   Amends the definition of “adequate reserve fund” to exclude the benefit cost rate from June 2020 through August 2021 effective from 2023 to 2030.  We see this an attempt to stabilize unemployment rates for the years 2023 through 2030 without resorting to artificially setting the rate schedule by statute.

Continue reading SB 3128; HB 2160

HB 1278, HD1

SUBJECT:  UNEMPLOYMENT, Pandemic Rate Relief

BILL NUMBER:  HB 1278, HD1

INTRODUCED BY:  House Committees on Labor & Tourism and Finance

EXECUTIVE SUMMARY:  Amends the definitions of benefit year and week. Conforms the manner of filing claims for partial benefits to the same as for total or part-total benefits. Requires the director of labor and industrial relations to omit benefits charged for experience rating  for employers due to the event of COVID-19 in calendar years 2021 and 2022. For calendar years 2021 and 2022, sets the employer contribution rate at schedule D. Makes amendments to contribution  rate schedule and procedure for determination retroactive to 1/1/2021.

Continue reading HB 1278, HD1