Farewell Darwin

Darwin Ching's last day as Director of Labor was Tuesday, June 15. While he never formally mentioned it, it is clear that he resigned to run for Honolulu Prosecutor. The general consensus at Wage Standards is that Darwin did a good job as the Director of Labor. Darwin was a sincere person who values people's efforts. During holiday times he would always come around and make a point to thank individuals for their work and wish them a happy, healthy holiday. It seems like a small thing, but it meant a lot to employees who never had interactions with him. While I didn't agree with everything he pursued, I respected how he listened and tried to meet people somewhere in the middle. I think the the Dept. of Labor and Industrial Relations has benefited from his presence.

Allowable Fringe Benefits in the Prevailing Wage Law

Allowable fringe benefits must first be a benefit to employees.

Two questions were asked recently about whether credit could be taken for a fringe benefit under our prevailing wage law, Chapter 104, Hawaii Revised Statutes, for the supply and laundry of uniforms and for the general excise tax paid by contractors. The answer to both is no, these are not allowable fringe benefits that can be credited towards the prevailing wage on public works in Hawaii.

The supply and laundry of uniforms is at the direction of the employer and therefore a cost of doing business. Requiring an employee to wear a uniform is not a benefit to the employee. It is generally unlawful for employers to deduct for the cost and maintenance of a uniform required to be worn at work.

The payment of general excise tax is required by all businesses in Hawaii unless specifically exempt. There is no exemption for construction work. As a required amount to be paid by the employer to the State, the general excise tax is not a benefit to an employee.

Chapter 104 Overview

Yesterday we held the free Chapter 104 Overview workshop for the largest audience yet. Chapter 104, Hawaii Revised Statutes is the Hawaii version of the federal Davis-Bacon Act. Forty-nine people showed up out of 55 signed up. That tells me that interest in compliance and participating in public works is increasing. I remember when we had to beg people to attend just to get 6 attendees a few years ago when we started this. I enjoy teaching the class because I hear first hand what the concerns are with the law. There were several specific questions identified this time that I'll be addressing in future blogs.

2010 Legislative Session is Here

The 2010 Legislative session opened last Wednesday, January 20. The main issue at the DLIR concerns lessening the blow of the Unemployment Tax increase for businesses that is expected this year due to the high unemployment. WSD has spotted some issues introduced by others that may effect the Wage Standards Division, but we'll wait on any comments until the measures are assigned a hearing.

October Furlough Fridays

The Department of Labor and Industrial Relations will be closed on October 23, and October 30, 2009, due to a furlough as agreed with the HGEA and the Governor as a result of the current economic situation in Hawaii.

Columbus Day - Not a State Holiday

This is a reminder for contractors and subcontractors working on state and county public works projects. Columbus Day, October 12, 2009, is not a State holiday and therefor mechanics and laborers working on the public site can be paid straight time. When submitting your certified payroll this week for last week's work, be sure and check your records, this is one holiday that doesn't pay overtime.

Itemizing Fringe Benefits on Certified Payrolls

Act 10, First Special Session 2009, became effective October 1, 2009. This means that anyone submitting a certified payroll on a public works job subject to Chapter 104, Hawaii Revised Statutes, now has to provide an itemized list of the fringe benefits paid to laborers and mechanics along with their certified payroll. The Department of Labor and Industrial Relations (DLIR) worked with the Department of Accounting and General Services (DAGS) to adapt a form currently being used by DAGS on public works construction.

The Public Works Division of DAGS has numerous forms available on their website arranged according to the stage of construction. The adapted form for Act 10 is an xcel file found under "Ongoing Construction" on the Public Works Administration of Construction Page and is called "Statement of Compliance and DAGS ECP for Payroll Affidavits". http://hawaii.gov/pwd/Members/ib/forms/index_html. The DAGS adapted form is actually four worksheets.

Act 10 only pertains to the worksheet of the adapted form labeled "Weekly Statement of Compliance" which lists the itemized fringe benefits. The Certifited Payroll worksheet form is unchanged. WSD will be focusing their educational efforts in the comming months on this issue as well as some of the American Recovery and Reinvestment Act (ARRA) issues.