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Employment and labor laws in Hawaii 2024 guide

An employer's guide to labor laws, payroll, benefits, and taxes in Hawaii.

Hawaii at a Glance

State capital

Honolulu

Population

1.4 million

State motto

"Ua Mau ke Ea o ka ʻĀina i ka Pono" ("The life of the land is perpetuated in righteousness")

Key industries

Tourism, Defense, Agriculture

Major economic hubs

Honolulu, Pearl City, Hilo

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Introduction to employment laws in Hawaii

Overview

Hawaii has a complex regulatory landscape for employers, such as its unique minimum wage structure, background check laws, and additional wage and leave laws. With industries such as tourism and defense driving its economy, the state has developed robust employment laws designed to protect the interests of both employers and employees.

We’ve put together this guide to help you stay compliant while hiring, onboarding, and managing employees in Hawaii.

Employing in Hawaii: Key employment laws and practices

Standard work hours

Work hours in Hawaii are governed by both state and federal law. Full-time employment in Hawaii is typically regarded as between 35-40 hours per week, though this isn’t explicitly defined by law.

For non-exempt employees, the Fair Labor Standards Act mandates overtime pay at 1.5 times the regular pay rate for any hours worked over 40 in a week. In Hawaii as in most other states, employees are generally exempt from overtime if they earn more than the state’s threshold of $684 per week, have executive or managerial duties, or work in a certified or licensed profession.

Contractual and self-employed professionals have more flexible work hours, typically determined by the terms of their contracts.

Minimum wage and overtime

The current minimum wage in Hawaii is $14.00 per hour for private-sector employees, significantly higher than the federal minimum. By law, the rate is scheduled to increase incrementally to $18 per hour by January 1, 2028.

Overtime pay, as dictated by the FLSA, applies to non-exempt employees who work more than 40 hours in a week. The overtime rate is 1.5 times the employee’s regular pay rate.

Insurance and benefits

In addition to wages, employers in Hawaii are responsible for providing certain benefits and insurance coverage to their employees.

One requirement in Hawaii is Temporary Disability Insurance (TDI), which provides partial wage replacement for eligible employees unable to work due to a non-work-related injury or illness, including pregnancy and organ donation. All employers must also provide healthcare coverage and pay employee premiums for three months following the month when an employee’s disability begins, or as long as the employee is receiving regular wages (whichever is longer).

Another requirement is coverage under the Prepaid Health Care Act (PHCA). All employers with one or more employees, regardless of full-time or part-time, permanent or temporary, are required to provide PHCA coverage to their eligible employees in Hawaii, unless the employees fall into an excluded category. This coverage is mandatory for employees who work at least 20 hours per week.

In terms of retirement benefits, employers must comply with federal laws such as the Employee Retirement Income Security Act, which sets minimum standards for retirement plans in private industry.

Here’s a snapshot of the mandatory benefits in Hawaii:

Benefit

Description

 

Temporary Disability Insurance (TDI)

Up to 26 weeks of partial wage replacement (58% of the employee’s average weekly wages up to the maximum weekly benefit amount annually set by this Division)

 

Prepaid Health Care Act (PHCA)

Employer must pay employee premiums for three months or as long as the employee receives regular wages

Meal and rest periods

Consistent with federal regulations, Hawaii requires an employer to provide at least a 30-minute meal or rest break to all minors 14 or 15 years of age who work five consecutive hours. There is no law in Hawaii that requires rest or meal breaks for any other employees.

Anti-discrimination laws

Hawaii has extensive anti-discrimination laws that provide greater protections for employees than federal law.

Under the Hawaii Fair Employment Practices Act, it is illegal for employers to discriminate against employees or applicants based on factors such as race, color, national origin, ancestry, religion, sex (including gender identity and expression), pregnancy (including childbirth, breastfeeding and related medical conditions), disability (mental and physical), genetic information, age, sexual orientation, status as a domestic or sexual violence victim, arrest and court record, marital status, and reproductive health decisions.

Hawaii employment laws prohibit harassment of any nature, which is considered a form of illegal discrimination. Retaliation against a person who files a complaint of discrimination or participates in an investigation is also illegal under Hawaii law.

Multiplier makes it easy to manage benefits for Hawaii employees.

Leave policies

Hawaii does not require employers to provide vacation or sick leave.

Hawaii has extensive laws regarding employee leave. The Hawaii Family Leave Law (HFLL) requires employers with 100 or more employees to provide up to four weeks of job-protected family leave per calendar year. Eligible reasons for such leave include the birth or adoption of a child or caring for a covered family member with a serious health condition.

In addition to the HFLL, Hawaii has other time-off laws covering organ and stem cell donation leave, domestic and sexual violence leave, jury duty leave, witness leave, and military leave.

Leave type

Description

Family leave

Up to four weeks per year for childbirth, adoption, or to care for a family member with a serious health condition

Jury duty leave

Employers must allow employees to take time off for jury duty

Military leave

Time off is granted for military service

Domestic or sexual violence leave

Employers must provide time off for victims of domestic or sexual violence

Termination laws

Terminations in Hawaii should be handled with care due to specific laws protecting employees. While Hawaii is an at-will employment state, meaning that employers can dismiss employees at any time without cause, there are exceptions to this rule. These exceptions include cases involving discrimination, retaliation, or violations of public policy.

Hawaii employment laws do not require employers to offer severance pay unless it is stipulated in an employment contract or company policy.

Easily onboard employees in Hawaii?

Safety and health

Employers in Hawaii are required by law to provide a safe and healthy work environment for their employees. This includes adherence to state-specific safety regulations and industry-specific standards. An employer must comply with all requirements of the Hawaii Occupational Safety and Health Law (HIOSH), which mirrors the federal Occupational Safety and Health Act (OSHA).

Taxes in Hawaii

Employers are responsible for paying Employment Training Tax, Social Security, and Medicare. These taxes contribute to the federal welfare system and help fund programs like unemployment insurance.

Tax type

Description

Federal income tax

Withheld from employee wages based on IRS guidelines

Hawaii state income tax

Withheld from employee wages based on state guidelines (1.4% to 11%)

Social Security

Employer and employee each pay 6.2% of wages up to the yearly maximum

Medicare

Employer and employee each pay 1.45% of all wages

Employment training tax

Paid by the employer to fund state unemployment benefits (0.01% of an employee’s wages, paid by the employer)

Managing Hawaii employees with an Employer of Record (EOR)

Working with a team in Hawaii demands a deep understanding of the state’s specific employment laws. Businesses often grapple with a variety of regulatory hurdles, such as keeping up with changes in legal requirements, managing payroll effectively, and ensuring a positive work environment for all employees.

Multiplier provides a comprehensive suite of services tailored to help businesses navigate HR and compliance complexities. As an employer of record (EOR), Multiplier enables you to hire full-time workers in Hawaii without the need to establish U.S. entities.

Further, with its robust global payroll platform, Multiplier helps you pay your employees and contractors in Hawaii while adhering to all local tax laws and regulations.

Explore how Multiplier can streamline your HR processes and ensure complete compliance with Hawaii’s employment laws. Book a demo today.

FAQs

Full-time employment in Hawaii is generally considered to be between 35 and 40 hours per week. However, it’s important to note that this isn’t explicitly defined by law. The Fair Labor Standards Act stipulates that non-exempt employees are entitled to overtime pay at 1.5x their regular pay rate if they work more than 40 hours a week.

Hawaii has set its minimum hourly wage at $14 for private sector employees, which is higher than the federal minimum wage.

The Hawaii Fair Employment Practices Act prohibits discrimination based on various protected characteristics such as race, religion, age, sex, disability, and more.

Hawaii has specific regulations related to credit and criminal checks. Credit checks can only be performed post-offer and for certain types of jobs. On the other hand, criminal checks must not influence employment decisions based on an employee’s arrest and court record. Convictions may be considered post-offer, but only if they bear a rational relationship to the role’s duties and responsibilities.

The Hawaii Temporary Disability Insurance (TDI) Law provides up to 26 weeks of partial wage replacement for eligible employees unable to work due to a non-work-related injury or illness. In case an employee cannot work due to sickness or hospitalization, the employer is required to continue the employee’s healthcare coverage and pay the employee’s premiums for at least three months following the onset of the disability.

Managing employees in Hawaii?

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