Hawaii Employers Should Know These 2020 Changes to Labor Laws

There is a long list of federal, state and even local labor laws that every business owner must comply with in order to avoid legal...

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There is a long list of federal, state and even local labor laws that every business owner must comply with in order to avoid legal issues. These laws affect lunch breaks, paid holidays, sick pay, the minimum wage, overtime pay and much more. It would be challenging enough if new business owners were required to learn all relevant labor laws just once before opening their first business, but the reality is that employment and labor laws change every year and 2020 is no different. In order to stay in compliance, Hawaii employers must know the changes to federal and Hawaii labor laws in 2020.

Hawaii employers should know these changes to 2020 labor laws

The following changes will have a direct impact on HR compliance in 2020.

Hawaii labor laws:

In June, 2019 the Department of Labor & Industrial Relations announced that they would be partnering with the United States Department of Labor’s (U.S. DOL) Wage and Hour Division to increase enforcement of the Hawaii Wage and Hour Law. The increased enforcement is intended to encourage better communication and cooperation between state and federal agencies.

The employee time off to vote law (HRS Section 11-95) was repealed effective July 1, 2019. This means that starting with the 2020 election, Hawaii employers will no longer be obligated to give their employees two hours of time off to vote. This change coincides with a switch to mail-in ballots for state-wide elections.

As of July 2, 2019, HRS Section 378-1 and HRS Section 378-2 was amended, making reproductive health decisions a protected class under Hawaii’s anti-discrimination laws.

New federal employment laws:

As of January 1, 2020, the U.S. Department of Labor (DOL) raised the federal overtime exemption threshold for executive, administrative, and professional workers to $35,568 per year ($684 per week) from $23,660 per year ($455 per week); and for “highly compensated employees” to $107,432 per year. This new rule could exempt thousands of Hawaii workers from the Fair Labor Standards Act (FLSA) minimum wage and overtime pay requirements. Under Hawaii state law, employees with a guaranteed pay of $2,000 or more per month were already exempt from overtime pay but with this final rule in place, the higher salary threshold takes precedence. Employers should also know that nondiscretionary bonuses and incentives payments such as commissions may be used to fulfill up to 10 percent of the new salary level requirement.

On September 12, 2019, the Equal Employment Opportunity Commission (EEOC) announced that it will stop mandating that employers with at least 100 employees collect employee pay data (EEO-1 Component 2 data). The change went into effect immediately, though 2017 and 2018 EEO-1 pay data must be submitted and the courts instructed the agency to continue collecting data until the end of January, 2020.

According to IRS notice 2019-59, effective January 1, 2020, 401(k) contribution limits will rise by $500. In The combined employer and employee contribution limit will increase by $1,000 to $57,000 and employees over the age of 50 will be able to contribute an additional $500, changing the catch-up contribution limit to $6,500.

This post is meant to be a reference, rather than a complete list of Hawaii’s employment laws.

Partnering with Makai HR

It takes a lot of work to keep up with changes to labor laws. If you’re worried about complying with Hawaii labor laws, we’ve got you covered through HR outsourcing! When you partner with Makai HR, you can get on with the business you are trying to grow with the peace of mind that we’re making sure you’re in compliance with all of Hawaii’s employer laws. We carry $1 million in Employment Practices Liability (EPL) coverage for all clients as a second layer of protection in case you receive claims such as wrongful termination or harassment. We have a team of expert labor law attorneys to review claims and provide guidance, and pre-negotiated fees for local external labor attorneys when needed.

In addition to help with compliance, we also take care of your employee needs from payroll to taxes, health insurance/benefits and worker’s compensation. When choosing a PEO to partner with, there are many things to consider including cost, services and technology solutions.

What are you waiting for? Companies who partner with a PEO benefit from 7-9% faster growth, 10-14% lower employee turnover; and they are 50% less likely to go out of business. ,Contact us today to get started!

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