Report Title:

Civil Service Reform

 

Description:

Enacts various civil service reforms affecting classification and compensation, the civil service commission, the public employees compensation appeals board, employee benefits, exempt positions, conflicts with collective bargaining agreements, recruitment, workforce reductions, job performance, and career planning.

 

HOUSE OF REPRESENTATIVES

H.B. NO.

879

TWENTY-FIRST LEGISLATURE, 2001

 

STATE OF HAWAII

 


 

A BILL FOR AN ACT

 

RELATING TO PUBLIC EMPLOYEES.

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

Part I

SECTION 1. The purpose of this part is to require the director of human resources development, through the use of broadband classes, to:

(1) Reduce the number of classes of work existing in the civil service on January 1, 2001; and

(2) Describe competency levels and specialty areas, if any, in class specifications for the purpose of paying an employee based on the employee's demonstrated competence.

SECTION 2. (a) The director of human resources development, through the use of broadband classes, shall reduce the number of classes of work existing in the civil service on January 1, 2001, by not less than          per cent before July 1, 2003.

(b) The director of human resources development, through the use of broadband classes, shall reduce the number of classes of work existing in the civil service on January 1, 2001, by not less than          per cent before July 1, 2005.

(c) The director of human resources development, through the use of broadband classes, shall reduce the number of classes of work existing in the civil service on January 1, 2001, by not less than          per cent before July 1, 2007.

(d) The director of human resources development, through the use of broadband classes, shall reduce the number of classes of work existing in the civil service on January 1, 2001, by not less than          per cent before July 1, 2009.

(e) The director of human resources development, through the use of broadband classes, shall reduce the number of classes of work existing in the civil service on January 1, 2001, by not less than          per cent before July 1, 2011.

SECTION 3. The civil service to which this part applies shall comprise all positions in the State and include all personal services performed for the State, except those positions and personal services exempted from the civil service by section 76-16, Hawaii Revised Statutes, or another specific law.

SECTION 4. (a) Notwithstanding chapter 89, Hawaii Revised Statutes, or any collective bargaining agreement to the contrary, the director of human resources development shall not be required to consult with, or obtain the concurrence of, the exclusive representative of a public employee organization in order to carry out the purposes of this Act.

(b) In addition to the minimum qualifications for each broadband class, the director of human resources development may establish other job-related qualifications that may be required for particular positions within a class.

(c) When the director of human resources development establishes a broadband class, the director shall describe the competency levels and specialty areas, if any, in the class specification. The director shall specify any instances in which these competency levels and specialty areas are to be treated as separate classes for the purpose of applying other laws or rules, or for the purpose of paying an employee based on the employee's demonstrated competence.

(d) In the event of a conflict between this part and chapter 89, Hawaii Revised Statutes, or any collective bargaining agreement, this Act shall control.

SECTION 5. As used in this part:

"Broadband classes" mean classes for which the same general title may be used to designate each position allocated to the class and which may include more than one level or more than one specialty area within the same general field or work.

"Class or class of work" means all positions which are sufficiently similar with respect to their duties, responsibilities, and authority and level of difficulty that the same descriptive title may be used to describe each position allocated to the class, that the same basic requirements as to education, experience, knowledge, skill, ability, and other qualifications are applicable, and that the same pay range may be assigned.

"Class specification" means the official document providing a formalized summary depicting the duties, responsibilities, level of difficulty and authority, and minimum qualification requirements of a class.

Part II

SECTION 6. The purpose of this part is to limit the basis for judgments made by the civil service commission, the public employees' compensation appeals board, the judiciary personnel appeals board, and the Hawaii health systems corporation personnel appeals board to findings, conclusions, decisions, or orders that are:

(1) In violation of constitutional or statutory provisions;

(2) In excess of the statutory authority or jurisdiction of the director of human resources development, the administrative director of the courts, or the Hawaii health systems corporation chief executive officer;

(3) Made upon unlawful procedure;

(4) Affected by other error of law;

(5) Clearly erroneous in view of the reliable, probative, and substantial evidence on the whole record; or

(6) Arbitrary, or capricious, or characterized by abuse of discretion or clearly unwarranted exercise of discretion.

SECTION 7. Act 253, Session Laws of Hawaii 2000, is amended as follows:

1. By amending section 12 of the Act to read:

"SECTION 12. Section 76-14, Hawaii Revised Statutes, is amended to read as follows:

"§76-14 Merit appeals board; duties, and jurisdiction. (a) The merit appeals board of each jurisdiction shall decide appeals from any action under this chapter taken by the chief executive, the director, an appointing authority, or a designee acting on behalf of one of these individuals, relating to:

(1) Recruitment and examination;

(2) Classification and reclassification of a particular position;

(3) Initial pricing of classes; and

(4) Other employment actions under this chapter, including disciplinary actions and adverse actions for failure to meet performance requirements, taken against civil service employees who are excluded from collective bargaining coverage under section 89-6.

(b) Any person suffering legal wrong by an action under subsection (a)(1) or aggrieved by such action shall be entitled to appeal to the merit appeals board. Any employee covered by chapter 76 suffering legal wrong by an action under subsection (a)(2) or (3) shall be entitled to appeal to the merit appeals board. Only employees covered by chapter 76, who are excluded from collective bargaining, suffering legal wrong by an action under subsection (a)(4) shall be entitled to appeal to the merit appeals board. Appeals under this section shall be filed within time limits and in the manner provided by rules of the merit appeals board.

(c) The rules adopted by the merit appeals board shall provide for the following:

(1) The merit appeals board shall not act on an appeal, but shall defer to other authority, if the action complained of constitutes a prohibited act that is subject to the jurisdiction of another appellate body or administrative agency or the grievance procedure under a collective bargaining agreement;

(2) The merit appeals board shall not proceed on an appeal or shall hold proceedings in abeyance if there is any controversy regarding its authority to hear the appeal until the controversy is resolved by the Hawaii labor relations board;

(3) The merit appeals board shall prescribe time limits for filing an appeal that require exhaustion of all internal complaint procedures, including administrative review and departmental complaint procedures, before an appeal is filed; and

(4) The merit appeals board shall use the conditions listed in section 76-41(c) in reaching a decision on whether actions taken by the appointing authority based on a failure by the employee to meet the performance requirements of the employee's position is with or without merit.

(d) Upon review of the record, the merit appeals board may affirm the decision of the chief executive, the director, an appointing authority, or a designee acting on behalf of one of these individuals or remand the case with instructions for further proceedings; or it may reverse or modify the decision and order if the substantial rights of the petitioners may have been prejudiced because the director's findings, conclusions, decisions, or orders are:

(1) In violation of constitutional or statutory provisions;

(2) In excess of the statutory authority or jurisdiction of the director;

(3) Made upon unlawful procedure;

(4) Affected by other error of law;

(5) Clearly erroneous in view of the reliable, probative, and substantial evidence on the whole record; or

(6) Arbitrary, or capricious, or characterized by abuse of discretion or clearly unwarranted exercise of discretion.""

2. By amending subsection (e) of section 76-47, Hawaii Revised Statutes, in section 28 of the Act to read:

"(e) Any civil service employee, who is suspended, discharged, or demoted and who is not included in an appropriate bargaining unit under section 89-6, may appeal to the merit appeals board within twenty days after a final decision is made under the internal complaint procedures.

Upon the appeal, both the appealing employee and the appointing authority shall have the right to be heard publicly, present evidence and be represented by counsel, who shall have the right to examine and cross-examine witnesses. At the hearing technical rules of evidence shall not apply and the evidence shall be taken stenographically or recorded by machine. For the purpose of hearing the appeals fairly and expeditiously, the board may at any time appoint a competent and qualified disinterested person to act as its hearing officer. The hearing officer shall hear the matter in the same manner as if it were before the board and upon the conclusion of the hearing, shall report the hearing officer's findings of fact and the hearing officer's conclusions and recommendations based thereon to the board and to the employee. The board shall render the final decision in accordance with [section 91-11.] section 76-14(d).

If the board finds that the reasons for the action are not substantiated in any material respect, the board shall order that the employee be reinstated in the employee's position, without loss of pay, but if the board finds that the reasons are substantiated or are only partially substantiated, the board shall sustain the action of the appointing authority, provided that the board may modify the action of the appointing authority if it finds the circumstances of the case so require and may thereupon order such disposition of the case as it may deem just.

The findings and decisions of the board shall be final on all appeals, unless an appeal is taken as provided in chapter 91.

Notwithstanding any other law to the contrary, when an appeal hearing is before a merit appeals board of a county or the city and county of Honolulu, the attorney general shall be counsel for the board and the county attorney or corporation counsel shall be counsel for the appointing authority. If, however, an appeal hearing is before the state merit appeals board, the attorney general shall be counsel for the appointing authority and the county attorney or corporation counsel of the county, including the city and county of Honolulu, in which the appeal hearing is being conducted shall be counsel for the state merit appeals board.

Notwithstanding any other law to the contrary, when the decision and order of the merit appeals board of a county or the city and county of Honolulu, is appealed as provided in chapter 91, the attorney general shall be counsel for the board and the county attorney or corporation counsel shall be counsel for the appointing authority. When the decision and order of the state merit appeals board is appealed as provided in chapter 91, the attorney general shall be counsel for the appointing authority and the county attorney or corporation counsel of the county, including the city and county of Honolulu, in which the chapter 91 appeal is being conducted, shall be counsel for the state merit appeals board."

3. By amending section 76-121, Hawaii Revised Statutes, as amended under section 150 of the Act to read:

"§76-121 Employees of the Hawaii health systems corporation. (a) It is the intent of the legislature that the personnel of the Hawaii health systems corporation shall constitute a separately administered part of the system of personnel administration established by this chapter, unless specifically exempted by this chapter or any other law; provided that:

(1) The Hawaii health systems corporation shall have a status coequal with the executive branch of the State and with the several counties for purposes of:

(A) Developing a position classification plan;

(B) Formulating personnel rules; and

(C) Administrating the Hawaii health systems corporation personnel system, including classification, reclassification, allocation, and reallocation of a particular position; the publication of a vacancy announcement; the examination of applicants; and the preparation of eligible lists;

(2) In the development of a position classification plan, the formulation of personnel rules and regulations, and the administration of the Hawaii health systems corporation personnel system, the corporation chief executive officer or the corporation chief executive officer's designee shall consult with the director of human resources development;

(3) Any action of the corporation chief executive officer or the corporation chief executive officer's designee including:

(A) The classification, reclassification, allocation, and reallocation of a particular position;

(B) The publication of a vacancy announcement;

(C) The examination of applicants;

(D) The preparation of an eligible list; and

(E) Appeals from suspensions, dismissals, and demotions not covered by collective bargaining;

may be appealed by any person, employee, or the exclusive bargaining unit representative to the Hawaii health systems corporation personnel appeals board. The board shall be composed of three members, one representative from the department of human resources development, one representative of the Hawaii health systems corporation, and one appropriate exclusive bargaining unit representative. Section 26-34 shall not apply to the members of the Hawaii health systems corporation personnel appeals board. The board shall sit as an appellate body on matters within the jurisdiction of the Hawaii health systems corporation with equal authority as the civil service commission established by section 26-5; and

(4) Nothing in chapter 76 shall be construed to require the governor or any executive agency for the Hawaii health systems corporation to approve positions in the corporation.

(b) Upon review of the record, the Hawaii health systems corporation personnel appeals board may affirm the decision of the Hawaii health systems corporation chief executive officer or remand the case with instructions for further proceedings; or it may reverse or modify the decision and order if the substantial rights of the petitioners may have been prejudiced because the chief executive officer's findings, conclusions, decisions, or orders are:

(1) In violation of constitutional or statutory provisions;

(2) In excess of the statutory authority or jurisdiction of the chief executive officer;

(3) Made upon unlawful procedure;

(4) Affected by other error of law;

(5) Clearly erroneous in view of the reliable, probative, and substantial evidence on the whole record; or

(6) Arbitrary, or capricious, or characterized by abuse of discretion or clearly unwarranted exercise of discretion."

Part III

SECTION 8. The purpose of this part is to allow the State and counties to interpret, administer, and apply their own personnel classification and compensation systems.

SECTION 9. Act 253, Session Laws of Hawaii 2000, is amended by amending section 5 to read as follows:

"SECTION 5. Section 76-1, Hawaii Revised Statutes, is amended to read as follows:

"§76-1 Purposes; merit principle. It is the purpose of this chapter to require each jurisdiction to establish and maintain a separately administered civil service system based on the merit principle. The merit principle is the selection of persons based on their fitness and ability for public employment and the retention of employees based on their demonstrated appropriate conduct and productive performance. It is also the purpose of this chapter to authorize each jurisdiction to interpret, administer, and apply their own personnel classification and compensation systems. It is also the purpose of this chapter to build a career service in government, free from coercive political influences, to render impartial service to the public at all times, according to the dictates of ethics and morality and in compliance with all laws.

In order to achieve these purposes, it is the declared policy of the State that the human resource program within each jurisdiction be administered in accordance with the following:

(1) Equal opportunity for all in compliance with all laws prohibiting discrimination. No person shall be discriminated against in examination, appointment, reinstatement, reemployment, promotion, transfer, demotion, or removal, with respect to any position when the work may be efficiently performed by the person without hazard or danger to the health and safety of the person or others;

(2) Impartial selection of individuals for public service by means of competitive tests which are fair, objective, and practical;

(3) Incentives for competent employees within the service, whether financial or promotional opportunities and other performance based group and individual awards that encourage continuous improvement to achieve superior performance;

(4) Reasonable job security for competent employees and discharge of unnecessary or inefficient employees with the right to grieve and appeal personnel actions through the:

(A) Contractual grievance procedure for employees covered by chapter 89; or

(B) Internal complaint procedures and the merit appeals board for employees excluded from coverage under chapter 89;

(5) Equal pay for equal work shall apply between classes in the same bargaining unit among jurisdictions for those classes determined to be equal through systematic classification of positions based on objective criteria and adequate job evaluation, unless it has been agreed in accordance with chapter 89 to negotiate the repricing of classes; and

(6) Harmonious and cooperative relations between government and its employees, including employee organizations representing them, to develop and maintain a well-trained, efficient, and productive work force that utilizes advanced technology to ensure effective government operations and delivery of public services.""

Part IV

SECTION 10. The purpose of this part is to:

(1) Establish employee benefits by law, rather than collective bargaining negotiations; and

(2) Link employee compensation and benefits together for planning, programming, and budgeting purposes;

in order to allow the legislature to better evaluate and control long-term employee costs.

SECTION 11. Section 88-8, Hawaii Revised Statutes, is amended by amending subsection (h) to read as follows:

"(h) Notwithstanding any other law to the contrary, retirement benefits for the optional retirement system of the University of Hawaii shall be [a subject of collective bargaining negotiations for bargaining unit (7).] established by law."

SECTION 12. Section 89-2, Hawaii Revised Statutes, is amended by amending the definition of "employee organization" to read as follows:

""Employee organization" means any organization of any kind in which public employees participate and which exists for the primary purpose of dealing with public employers concerning grievances, labor disputes, wages, hours, [amounts of contributions by the State and counties to the Hawaii public employees health fund,] and other terms and conditions of employment of public employees."

SECTION 13. Act 253, Session Laws of Hawaii 2000, section 93, is amended by amending section 89-2, Hawaii Revised Statutes, as follows:

1. By amending the definitions of "collective bargaining" and "cost items" to read:

""Collective bargaining" means the performance of the mutual obligations of the public employer and an exclusive representative to meet at reasonable times, to confer and negotiate in good faith, and to execute a written agreement with respect to wages, hours, [amounts of contributions by the State and counties to the Hawaii public employees health fund,] and other terms and conditions of employment, except that by any such obligation neither party shall be compelled to agree to a proposal, or be required to make a concession. For the purposes of this definition, "wages" includes the number of incremental and longevity steps, the number of pay ranges, and the movement between steps within the pay range and between the pay ranges on a pay schedule under a collective bargaining agreement.

"Cost items" means all items agreed to in the course of collective bargaining that an employer cannot absorb under its customary operating budgetary procedures and that require additional appropriations by its respective legislative body for implementation[.], but shall not include amounts of contributions by the State and counties to the Hawaii public employees health fund."

2. By amending the definition of "mediation" to read:

""Mediation" means assistance by a neutral third party to resolve an impasse between the public employer and the exclusive representative through interpretation, suggestion, and advice[.], but shall not be in regard to amounts of contributions by the State and counties to the Hawaii public employees health fund."

SECTION 14. Act 253, Session Laws of Hawaii, 2000, is amended by amending section 98 to read as follows:

"SECTION 98. Section 89-9, Hawaii Revised Statutes, is amended to read as follows:

"§89-9 Scope of negotiations; consultation. (a) The employer and the exclusive representative shall meet at reasonable times, including meetings sufficiently in advance of the April 16 impasse date under section 89-11, and shall negotiate in good faith with respect to wages, hours, [the amounts of contributions by the State and respective counties to the Hawaii public employees health fund to the extent allowed in subsection (e),] and other terms and conditions of employment which are subject to collective bargaining and which are to be embodied in a written agreement as specified in section 89-10, but such obligation does not compel either party to agree to a proposal or make a concession; provided that the parties may not negotiate with respect to cost items as defined by section 89-2 for the biennium 1999 to 2001, and the cost items of employees in bargaining units under section 89-6 in effect on June 30, 1999, shall remain in effect until July 1, 2001.

(b) The employer or the exclusive representative desiring to initiate negotiations shall notify the other party in writing, setting forth the time and place of the meeting desired and the nature of the business to be discussed, sufficiently in advance of the meeting.

(c) Except as otherwise provided in this chapter, all matters affecting employee relations, including those that are, or may be, the subject of a rule adopted by the employer or any director, shall be subject to consultation with the exclusive representatives of the employees concerned. The employer shall make every reasonable effort to consult with exclusive representatives and consider their input, along with the input of other affected parties, prior to effecting changes in any major policy affecting employee relations.

(d) Excluded from the subjects of negotiations are matters of classification, reclassification, benefits of [but not] and contributions to the Hawaii public employees health fund, recruitment, examination, initial pricing, and retirement benefits [except as provided in section 88-8(h)]. The employer and the exclusive representative shall not agree to any proposal which would be inconsistent with the merit principle or the principle of equal pay for equal work pursuant to section 76-1 or which would interfere with the rights and obligations of a public employer to:

(1) Direct employees;

(2) Determine qualifications, standards for work, the nature and contents of examinations;

(3) Hire, promote, transfer, assign, and retain employees in positions;

(4) Suspend, demote, discharge, or take other disciplinary action against employees for proper cause;

(5) Relieve an employee from duties because of lack of work or other legitimate reason;

(6) Maintain efficiency and productivity, including maximizing the use of advanced technology, in government operations;

(7) Determine methods, means, and personnel by which the employer's operations are to be conducted; and

(8) Take such actions as may be necessary to carry out the missions of the employer in cases of emergencies.

The employer and the exclusive representative may negotiate procedures governing the promotion and transfer of employees to positions within a bargaining unit; the suspension, demotion, discharge, or other disciplinary actions taken against employees within the bargaining unit; and the layoff of employees within the bargaining unit. Violations of the procedures so negotiated may be subject to the grievance procedure in the collective bargaining agreement.

[(e) Negotiations relating to contributions to the Hawaii public employees health fund shall be for the purpose of agreeing upon the amounts which the State and counties shall contribute under section 87-4, toward the payment of the costs for a health benefits plan, as defined in section 87-1(8), and group life insurance benefits, and the parties shall not be bound by the amounts contributed under prior agreements; provided that section 89-11 for the resolution of disputes by way of fact-finding or arbitration shall not be available to resolve impasses or disputes relating to the amounts the State and counties shall contribute to the Hawaii public employees health fund.

(f)] (e) The repricing of classes within an appropriate bargaining unit may be negotiated as follows:

(1) At the request of the exclusive representative and at times allowed under the collective bargaining agreement, the employer shall negotiate the repricing of classes within the bargaining unit. The negotiated repricing actions that constitute cost items shall be subject to the requirements in section 89-10.

(2) If repricing has not been negotiated under paragraph (1), the employer of each jurisdiction shall ensure establishment of procedures to periodically review, at least once in five years, unless otherwise agreed to by the parties, the repricing of classes within the bargaining unit. The repricing of classes based on the results of the periodic review shall be at the discretion of the employer. Any appropriations required to implement the repricing actions that are made at the employer's discretion shall not be construed as cost items.""

SECTION 15. Act 253, Session Laws of Hawaii 2000, section 100, is amended by amending subsection (g) of section 89-11, Hawaii Revised Statutes, to read as follows:

"(g) The decision of the arbitration panel shall be final and binding upon the parties on all provisions submitted to the arbitration panel. [If the parties have reached agreement with respect to the amounts of contributions by the State and counties to the Hawaii public employees health fund by the tenth working day after the arbitration panel issues its decision, the final and binding agreement of the parties on all provisions shall consist of the panel's decision and the amounts of contributions agreed to by the parties. If the parties have not reached agreement with respect to the amounts of contributions by the State and counties to the Hawaii public employees health fund by the close of business on the tenth working day after the arbitration panel issues its decision, the parties shall have five days to submit their respective recommendations for such contributions to the legislature, if it is in session, and if the legislature is not in session, the parties shall submit their respective recommendations for such contributions to the legislature during the next session of the legislature. In such event, the final and binding agreement of the parties on all provisions shall consist of the panel's decision and the amounts of contributions established by the legislature by enactment, after the legislature has considered the recommendations for such contributions by the parties. It is strictly understood that no member of a bargaining unit subject to this subsection shall be allowed to participate in a strike on the issue of the amounts of contributions by the State and counties to the Hawaii public employees health fund.] The parties shall take whatever action is necessary to carry out and effectuate the final and binding agreement. The parties may, at any time and by mutual agreement, amend or modify the panel's decision.

Agreements reached pursuant to the decision of an arbitration panel [and the amounts of contributions by the State and counties to the Hawaii public employees health fund, as provided herein,] shall not be subject to ratification by the employees concerned. All items requiring any moneys for implementation shall be subject to appropriations by the appropriate legislative bodies and the employer shall submit all such items within ten days after the date on which the agreement is entered into as provided herein, to the appropriate legislative bodies."

Part V

SECTION 16. Act 253, Session Laws of Hawaii 2000, section 15, is amended by amending subsection (a) of section 76-17, Hawaii Revised Statutes, to read as follows:

"(a) [In conformity with chapter 91, the] The director shall prescribe rules to carry out this chapter [which shall have the force and effect of law.]; provided that the rules shall not be subject to the public notice and public hearing requirements of chapter 91. The rules may include any matter not inconsistent with law concerning the establishment and maintenance of a system of personnel management based on the merit principle, including but not limited to matters set forth in this chapter, and may be amended or repealed in like manner as the same were adopted. The rules shall be in conformity with principles of good public administration."

Part VI

SECTION 17. The auditor shall conduct an audit of the civil service and compensation system established pursuant to chapters 76, Hawaii Revised Statutes, as amended by this Act and Act 253, Session Laws of Hawaii 2000, to determine the system's compliance with article XVI, section 1, of the Constitution of the State of Hawaii, regarding the merit principle. The auditor shall submit its findings and recommendations to the legislature not less than twenty days prior to the convening of the regular session of 2002.

SECTION 18. There is appropriated out of the general revenues of the State of Hawaii the sum of $        , or so much thereof as may be necessary for fiscal year 2001-2002, to carry out the purposes of this part. The sum appropriated shall be expended by the auditor.

Part VII

SECTION 19. The purpose of this part is to prevent the consideration of any legislative measure that establishes an exempt position until the auditor, by concurrent resolution, prepares and submits to the legislature a report that assesses the need to exempt the position from the civil service law.

SECTION 20. Act 253, Session Laws of Hawaii 2000, section 14, is amended by amending subsection (b) of section 76-16, Hawaii Revised Statutes, to read as follows:

"(b) The civil service to which this chapter applies shall comprise all positions in the State now existing or hereafter established and embrace all personal services performed for the State, except the following:

(1) Commissioned and enlisted personnel of the Hawaii national guard as such, and positions in the Hawaii national guard that are required by state or federal laws or regulations or orders of the national guard to be filled from those commissioned or enlisted personnel;

(2) Positions filled by persons employed by contract where the director of human resources development has certified that the service is special or unique or is essential to the public interest and that, because of circumstances surrounding its fulfillment, personnel to perform the service cannot be obtained through normal civil service recruitment procedures. Any such contract may be for any period not exceeding one year;

(3) Positions that must be filled without delay to comply with a court order or decree if the director determines that recruitment through normal recruitment civil service procedures would result in delay or noncompliance, such as the Felix-Cayetano consent decree;

(4) Positions filled by the legislature or by either house or any committee thereof;

(5) Employees in the office of the governor and office of the lieutenant governor, and household employees at Washington Place;

(6) Positions filled by popular vote;

(7) Department heads, officers, and members of any board, commission, or other state agency whose appointments are made by the governor or are required by law to be confirmed by the senate;

(8) Judges, referees, receivers, masters, jurors, notaries public, land court examiners, court commissioners, and attorneys appointed by a state court for a special temporary service;

(9) One bailiff for the chief justice of the supreme court who shall have the powers and duties of a court officer and bailiff under section 606-14; one secretary or clerk for each justice of the supreme court, each judge of the intermediate appellate court, and each judge of the circuit court; one secretary for the judicial council; one deputy administrative director of the courts; three law clerks for the chief justice of the supreme court, two law clerks for each associate justice of the supreme court and each judge of the intermediate appellate court, one law clerk for each judge of the circuit court, two additional law clerks for the civil administrative judge of the circuit court of the first circuit, two additional law clerks for the criminal administrative judge of the circuit court of the first circuit, one additional law clerk for the senior judge of the family court of the first circuit, two additional law clerks for the civil motions judge of the circuit court of the first circuit, two additional law clerks for the criminal motions judge of the circuit court of the first circuit, and two law clerks for the administrative judge of the district court of the first circuit; and one private secretary for the administrative director of the courts, the deputy administrative director of the courts, each department head, each deputy or first assistant, and each additional deputy, or assistant deputy, or assistant defined in paragraph (16);

(10) First deputy and deputy attorneys general, the administrative services manager of the department of the attorney general, one secretary for the administrative services manager, an administrator and any support staff for the criminal and juvenile justice resources coordination functions, and law clerks;

(11) Teachers, principals, vice-principals, district superintendents, chief deputy superintendents, other certificated personnel, not more than twenty noncertificated administrative, professional, and technical personnel not engaged in instructional work, teaching assistants, educational assistants, bilingual/bicultural school-home assistants, school psychologists, psychological examiners, speech pathologists, athletic health care trainers, alternative school work study assistants, alternative school educational/supportive services specialists, and alternative school project coordinators in the department of education; the special assistant to the state librarian, one secretary for the special assistant to the state librarian, and members of the faculty of the University of Hawaii, including research workers, extension agents, personnel engaged in instructional work, and administrative, professional, and technical personnel of the university;

(12) Employees engaged in special, research, or demonstration projects approved by the governor;

(13) Positions filled by inmates, kokuas, patients of state institutions, persons with severe physical or mental handicaps participating in the work experience training programs, and students and positions filled through federally funded programs that provide temporary public service employment such as the federal Comprehensive Employment and Training Act of 1973;

(14) A custodian or guide at Iolani Palace, the Royal Mausoleum, and Hulihee Palace;

(15) Positions filled by persons employed on a fee, contract, or piecework basis, who may lawfully perform their duties concurrently with their private business or profession or other private employment and whose duties require only a portion of their time, if it is impracticable to ascertain or anticipate the portion of time to be devoted to the service of the State;

(16) Positions of first deputies or first assistants of each department head appointed under or in the manner provided in section 6, Article V, of the State Constitution; three additional deputies or assistants either in charge of the highways, harbors, and airports divisions or other functions within the department of transportation as may be assigned by the director of transportation, with the approval of the governor; four additional deputies in the department of health, each in charge of one of the following: behavioral health, environmental health, hospitals, and health resources administration, including other functions within the department as may be assigned by the director of health, with the approval of the governor; an administrative assistant to the state librarian; and an administrative assistant to the superintendent of education;

(17) Positions specifically exempted from this part by any other law; provided that [all]:

(A) All of the positions defined by paragraph (9) shall be included in the position classification plan; and

(B) Before any legislative measure that establishes an exempt position can be considered, there shall be concurrent resolutions passed requesting the auditor to prepare and submit to the legislature a report that assesses the need to exempt the position from this chapter. The concurrent resolutions shall designate a specific legislative bill that has been introduced in the legislature. This subparagraph shall apply to all exempt positions established after January 1, 2001;

(18) Positions in the state foster grandparent program and positions for temporary employment of senior citizens in occupations in which there is a severe personnel shortage or in special projects;

(19) Household employees at the official residence of the president of the University of Hawaii;

(20) Employees in the department of education engaged in the supervision of students during lunch periods and in the cleaning of classrooms after school hours on a less than half-time basis;

(21) Employees hired under the tenant hire program of the housing and community development corporation of Hawaii; provided that not more than twenty-six per cent of the corporation's work force in any housing project maintained or operated by the corporation shall be hired under the tenant hire program;

(22) Positions of the federally funded expanded food and nutrition program of the University of Hawaii that require the hiring of nutrition program assistants who live in the areas they serve;

(23) Positions filled by severely handicapped persons who are certified by the state vocational rehabilitation office that they are able to perform safely the duties of the positions;

(24) One public high school student to be selected by the Hawaii state student council as a nonvoting member on the board of education as authorized by the State Constitution;

(25) Sheriff, first deputy sheriff, and second deputy sheriff; and

(26) A gender and other fairness coordinator hired by the judiciary.

The director shall determine the applicability of this section to specific positions.

Nothing in this section shall be deemed to affect the civil service status of any incumbent as it existed on July 1, 1955."

Part VIII

SECTION 21. The purpose of this part is to resolve all conflicts between state law and collective bargaining agreements in favor of state law.

SECTION 22. Section 89-19, Hawaii Revised Statutes, is repealed.

["§89-19 Chapter takes precedence, when. This chapter shall take precedence over all conflicting statutes concerning this subject matter and shall preempt all contrary local ordinances, executive orders, legislation, or rules adopted by the State, a county, or any department or agency thereof, including the departments of human resources development or of personnel services or the civil service commission."]

Part IX

SECTION 23. The purpose of this part is to allow civil service positions to be filled by the best applicants, whether or not the applicants are already within public service. This part abolishes the practice of giving first consideration to applicants already within public service, and of making noncompetitive promotions.

SECTION 24. Act 253, Session Laws of Hawaii 2000, is amended by amending section 17 to read as follows:

"SECTION 17. Section 76-22.5, Hawaii Revised Statutes, is amended to read as follows:

"§76-22.5 Recruitment. The director shall adopt rules in accordance with sections 76-1 and 78-1 to determine, establish, and maintain the manner in which civil service positions are to be filled. The director shall seek continuous improvements to streamline the recruitment process so that positions are filled in the most economic, efficient, and expeditious manner possible[.], and shall not be required to give first consideration for competent employees already within public service. This includes maximizing use of new technologies and developing more efficient alternatives to ensure the availability of qualified applicant pools whether it involves a change in the manner in which initial appointments are to be made, increased delegation to departments, or decentralization to appointing authorities, as necessary and appropriate.""

SECTION 25. Act 253, Session Laws of Hawaii 2000, is amended by amending section 19 to read as follows:

"SECTION 19. Section 76-27, Hawaii Revised Statutes, is amended to read as follows:

"§76-27 Probationary service and other requirements for membership in the civil service. (a) All employees appointed to civil service positions shall constitute the membership of the civil service, but no employee shall be entitled to membership in civil service until the employee has:

(1) Successfully completed the initial probation period required as part of the examination process to determine the employee's fitness and ability for the position; and

(2) Satisfied all requirements for employment prescribed by this chapter and the qualifications prescribed by section 78-1.

(b) Upon becoming a member in the civil service, the employee shall be entitled to hold the member's position for the duration of the member's appointment, subject to section 76-46. In addition, civil service employees with permanent appointments, including an employee who has return rights to a position in which the employee has a permanent appointment, shall have layoff rights under section 76-43. All other civil service employees whose appointments have a limitation date shall not have layoff rights and shall be released at the end of their appointments or earlier if there is lack of work, lack of funds, or other legitimate reasons.

(c) To retain membership in the civil service, all employees must continue to demonstrate their fitness and ability for their current positions by meeting all performance requirements of their positions. If an employee fails to meet performance requirements, section 76-41 shall apply.

(d) A member who is promoted or transferred to another position in the civil service may be required to successfully serve a new probation period as part of the examination process to determine the employee's fitness and ability for the new position but shall be entitled to all the rights and privileges of a member of the civil service, except the right to appeal a discharge from the new position (as distinguished from discharge from the service) for inefficiency during the probationary period, in which case the member shall be returned to the former position or a comparable position.

[(e) An employee serving an appointment with a limitation date may subsequently be appointed to the same position or a related position in the same class within the department when a permanent position is established or is vacated; provided that the employee was hired initially through civil service recruitment procedures and the period of service as a temporary appointee immediately preceded the appointment to the permanent position. The period of service performed as a temporary appointee may be credited toward the probation period if the appointing authority certifies that the employee has been performing satisfactorily and that the duties the employee has been performing are essentially similar to those required of the probationary appointment. Upon such certification, the period of service performed as a temporary appointee shall be credited toward fulfilling the required probation period and the employee shall serve only the remainder of the probation period, if any.]""

Part X

SECTION 26. The purpose of this part is to:

(1) Downsize state government through normal attrition to effect needed cost savings and to maintain employment security in the work force; and

(2) Permit filling of essential positions through internal transfers or promotions and external hires for certain classifications such as teachers and adult corrections officers.

SECTION 27. Notwithstanding any other law to the contrary, and effective from July 1, 2001 to June 30, 2004, the maximum number of permanent positions that the executive, the judiciary, and the office of Hawaiian affairs are authorized for all programs during fiscal year 2001-2002, fiscal year 2002-2003, and fiscal year 2003-2004:

(1) Shall not exceed the position ceilings for the executive, the judiciary, and the office of Hawaiian affairs specified in the Appropriations Act of 2001, the Judiciary Appropriations Act of 2001, and the office of Hawaiian affairs budget for fiscal year 2001-2002, respectively; and

(2) Shall be reduced at the beginning of each fiscal quarter, starting with the second quarter of fiscal year 2001-2002, by the number of full-time equivalent permanent positions made vacant during the preceding fiscal quarter, starting with the first quarter of fiscal year 2001-2002, for reasons other than promotion, dismissal, or demotion.

SECTION 28. The executive, the judiciary, and the office of Hawaiian affairs may transfer positions within their respective authorized position ceilings for the purposes of maximizing the utilization of personnel resources and staff productivity; provided that:

(1) All such actions shall be made with the prior approval of the governor, the chief justice, and the chairperson of the board of trustees of the office of Hawaiian affairs, respectively;

(2) This transfer flexibility shall be authorized only for fiscal year 2001-2002, fiscal year 2002-2003, and fiscal year 2003-2004; and

(3) The governor, the chief justice, and the chairperson of the board of trustees of the office of Hawaiian affairs, respectively, shall submit reports on all such transfers to the legislature not less than twenty days prior to the convening of the regular sessions of 2002, 2003, 2004, and 2005.

SECTION 29. This part shall not apply to:

(1) Any positions described in section 76-16, Hawaii Revised Statutes;

(2) Any positions in the following programs:

(A) EDN 100 - SCHOOL-BASED BUDGETING;

(B) EDN 150 - COMPREHENSIVE SCHOOL SUPPORT SERVICES;

(C) EDN 200 - INSTRUCTIONAL SUPPORT;

(D) EDN 400 - SCHOOL SUPPORT;

(E) EDN 500 - SCHOOL COMMUNITY SERVICE;

(F) EDN 407 - PUBLIC LIBRARIES;

(G) AGS 807 - PHYSICAL PLANT OPERATIONS & MAINTENANCE-AGS;

(H) AGS 808 - STUDENT TRANSPORTATION;

(I) PSD 402 - HALAWA CORRECTIONAL FACILITY;

(J) PSD 403 - KULANI CORRECTIONAL FACILITY;

(K) PSD 404 - WAIAWA CORRECTIONAL FACILITY;

(L) PSD 405 - HAWAII COMMUNITY CORRECTIONAL CENTER;

(M) PSD 406 - MAUI COMMUNITY CORRECTIONAL CENTER;

(N) PSD 407 - OAHU COMMUNITY CORRECTIONAL CENTER;

(O) PSD 408 - KAUAI COMMUNITY CORRECTIONAL CENTER;

(P) PSD 409 - WOMEN'S COMMUNITY CORRECTIONAL CENTER;

(Q) UOH 100 - UNIVERSITY OF HAWAII, MANOA;

(R) UOH 210 - UNIVERSITY OF HAWAII, HILO;

(S) UOH 700 - UNIVERSITY OF HAWAII, WEST OAHU;

(T) UOH 800 - UNIVERSITY OF HAWAII, COMMUNITY COLLEGES; and

(3) Any positions whose source of funding is federal funds.

SECTION 30. The governor, the chief justice, and the chairperson of the office of Hawaiian affairs shall submit enhanced voluntary separation plans to the legislature for review and, if appropriate, approval not less than twenty days prior to the convening of the regular sessions of 2002, 2003, and 2004 if this part does not begin to reduce the size and cost of state government by the forth quarter of fiscal year 2001-2002.

SECTION 31. The governor, the chief justice, and the chairperson of the board of trustees of the office of Hawaiian affairs shall examine the relevance and levels of service and programs being provided by state government, and the manner and procedures employed in their administration. This examination shall include the involvement of government employees and the public they serve.

SECTION 32. Nothing in this part shall be construed to prohibit the governor, the chief justice, or the chairperson of the board of trustees of the office of Hawaiian affairs from imposing cuts beyond the scope of this part.

Part XI

SECTION 33. The purpose of this part is to establish and maintain a system of performance ratings for the purpose of allowing individual employees and individual groups of employees in the civil service to appraise their own service; to validate their self-appraisal through external means, including review by neutral peers; and to improve their performance through a coordinated system of in-service training.

SECTION 34. Act 253, Session Laws of Hawaii 2000, is amended by amending section 23 to read as follows:

"SECTION 23. Section 76-41, Hawaii Revised Statutes, is amended to read as follows:

"§76-41 Performance appraisal systems; failure to meet performance requirements. (a) There shall be established and maintained performance appraisal systems for the purpose of evaluating the performance of employees in the civil service and improving the employees' performance. The performance appraisal systems shall be the basis for evaluating whether employees in the civil service meet the performance requirements of their respective positions as required in section 76-27. For the purposes of this section, "performance requirements" includes any qualification required for the position such as a license.

(b) An appointing authority may release an employee from the employee's position or discharge an employee from service if the employee fails to meet the performance requirements of the employee's position under the following conditions:

(1) The evaluation process and its consequences were discussed with the employee;

(2) The employee was made aware of the employee's current job description and job-related performance requirements;

(3) The evaluation procedures were observed, including providing the employee the opportunity to meet, discuss, and rebut the performance evaluation and apprising the employee of the consequences of failure to meet performance requirements;

(4) The evaluation was fair and objective;

(5) The employee was provided performance feedback during the evaluation period and, as appropriate, the employee was offered in-service remedial training in order for the employee to improve and meet performance requirements;

(6) The evaluation was applied without discrimination; and

(7) Prior to the end of the evaluation period that the employee is being considered for discharge due to failure to meet performance requirements, the feasibility of transferring or demoting the employee to another position for which the employee qualifies was considered.

(c) Any civil service employee who fails to meet performance requirements shall have the right to grieve under:

(1) A collective bargaining grievance procedure that culminates in a final and binding decision by a performance judge pursuant to section 89-10.8; or

(2) The departmental complaint procedure that culminates in a final and binding decision by the merit appeals board under section 76-14.

The performance judge or the merit appeals board, as the case may be, shall use the conditions in subsection (b) as tests in reaching a decision on whether the employer's action, based on a failure by the employee to meet performance requirements of the employee's position, was with or without merit.

(d) There shall be established and maintained a system of performance ratings for the purpose of allowing individual employees and individual groups of employees in the civil service to appraise their own service; to validate their self-appraisal through external means, including review by neutral peers; and to improve their performance through a coordinated system of in-service training.""

Part XII

SECTION 35. The purpose of this part is to require the department of human resources development, through its employee assistance program, to offer all regular state employees and their exclusive collective bargaining unit representatives supervised electronic access to non-confidential job information that can be used to enhance career decision making.

SECTION 36. The department of human resources development, through its employee assistance program, shall offer all regular state employees and their exclusive collective bargaining unit representatives supervised electronic access to non-confidential job information that can be used to enhance career decision making, including interactive programs designed for self-assessment, career planning and transitioning, workforce re-engineering, and job searching based on available occupational databases. Subject to the availability of funds, the department of human resources development may make this offer available to employees in the judiciary.

SECTION 37. There is appropriated out of the general revenues of the State of Hawaii the sum of $        , or so much thereof as may be necessary for fiscal year 2001-2002, to carry out the purposes of this part. The sum appropriated shall be expended by the department of human resources development.

Part XIII

SECTION 38. This Act shall not be applied so as to impair any collective bargaining agreement existing as of the effective date of this Act in a manner violative of either the Hawaii Constitution or Article I, section 10, of the United States Constitution.

SECTION 39. If any provision of this Act, or the application thereof to any person or circumstance is held invalid, the invalidity does not affect other provisions or applications of the Act which can be given effect without the invalid provision or application, and to this end the provisions of this Act are severable.

SECTION 40. It is the intent of this Act not to create an illegal result, to jeopardize the receipt of any federal aid, nor to impair the obligation of the State or any agency thereof to the holders of any bond issued by the State or by any such agency, and to the extent, and only to the extent, necessary to effectuate this intent, the governor, the chief justice, and the chairperson of the board of trustees of the office of Hawaiian affairs may modify the strict provisions of this Act, but shall promptly report any such modification with reasons therefor to the legislature at its next session thereafter for review by the legislature.

SECTION 41. All acts passed by the legislature during the regular sessions of 2001 and 2002 shall be amended to conform to this Act unless those acts specifically provide that this Act is being amended.

SECTION 42. If any provisions in this Act are found to be in conflict with any laws that were in existence on the effective date of this Act, the provisions of this Act shall control.

SECTION 43. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 44. This Act shall take effect on July 1, 2002; provided that parts I, VI, X, XII of this Act shall take effect on July 1, 2001.

INTRODUCED BY:

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