Employment Law in Hawaii: what to sort out first, the early sequence that protects options, and what usually shifts earliest

Hawaii employment law stands apart from every other state in the union in one critical respect: the Hawaii Prepaid Health Care Act (PHCA), enacted in 1974 — fifteen years before any other state contemplated mandatory employer health coverage and nearly four decades before the Affordable Care Act. The PHCA (HRS §§ 393-1 et seq.) requires all Hawaii employers to provide health insurance coverage to employees who work 20 or more hours per week. The PHCA was so prescient that it required an ERISA exemption when ERISA was enacted (ERISA's preemption of state health insurance laws would have voided the PHCA), and Congress specifically carved Hawaii out. The result is that every private-sector employee in Hawaii who works 20 or more hours per week has a state-law right to employer-sponsored health insurance — a right that predates the ACA by 36 years. The PHCA requirement covers: major medical hospitalization and physician care; the employee contribution (what the employee pays) cannot exceed 1.5% of their wages. The Hawaii Temporary Disability Insurance Law (HRS §§ 392-1 et seq.) similarly compels employers to provide disability income protection for non-work-related disabilities — one of only six states (alongside California, New Jersey, New York, Rhode Island, and Washington) with mandated TDI.

Hawaii's employment law also reflects the state's dominant industry: tourism. The hotel workers' union UNITE HERE Local 5 — representing workers at the major Waikīkī hotels, Maui resorts, and neighbor island properties — is one of the most powerful labor unions in Hawaii and one of the most aggressive hotel workers' unions in the country. The 2018-2019 Hawaii hotel workers' strike (Local 5 v. Marriott, Hyatt, Sheraton, and others — the longest hotel workers' strike in US history at the time, spanning 51 days across multiple properties in Honolulu and Maui) demonstrated the union's organizing strength. Hawaii is decidedly a pro-union state — without a right-to-work law, union membership is strongly supported by the state's political culture, and Hawaii's government workforce (HGEA — Hawaii Government Employees Association; HSTA — Hawaii State Teachers Association; UPW — United Public Workers) is heavily unionized.