Center for Labor Education & Research
University of Hawai&699699;i - West O&;ahu

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HRS Chapter 386
HAWAIʻI WORKERS' COMPENSATION LAW

as of July 2015

SECTIONS:

PART I. GENERAL PROVISIONS
§386-1. Definitions
§ 386-2. Definitions relating to family relationships
§ 386-3. Injuries covered
§ 386-3.5. Negotiation for benefit coverage
§ 386-4. Voluntary coverage
§ 386-5. Exclusiveness of right to compensation; exception.
§ 386-6. Territorial applicability
§ 386-7. Interstate and foreign commerce and maritime employment.
§ 386-8. Liability of third person
§ 386-8.5 Limits of third party liability
§ 386-9. Contracting out forbidden
§ 386-10. Out of state employers

PART II: COMPENSATION
Sections 21 to 57.

PART III: ADMINISTRATION
Secctions 71 to 100.

PART IV: SECURITY FOR COMPENSATION
Sections 121. to 155.

PART V: APPLICABILITY TO HAWAI'I GUARD, VOLUNTEER PERSONNEL AND PUBLIC BOARD MEMBERS
Sections 161. to 181.

PART VI. SELF-INSURANCE GROUPS
Sections 191. to 214.


PART I. GENERAL PROVISIONS

     §386-1 Definitions. In this chapter, unless the context otherwise requires:

     "Able to resume work" means an industrially injured worker's injury has stabilized after a period of recovery and the worker is capable of performing work in an occupation for which the worker has received previous training or for which the worker has demonstrated aptitude.

     "Appellate board" means the labor and industrial relations appeals board.

     "Compensation" means all benefits accorded by this chapter to an employee or the employee's dependents on account of a work injury as defined in this section; it includes medical and rehabilitation benefits, income and indemnity benefits in cases of disability or death, and the allowance for funeral and burial expenses.

     "Attending physician" means a physician who is primarily responsible for the treatment of a work injury. There shall not be more than one attending physician. If an injured employee is treated by more than one physician, the employee shall designate a physician as the attending physician.

     "Construction design professional" means any person who is a professional engineer, architect, or land surveyor who is registered under chapter 464 to practice that profession in the State.

     "Covered employment" means employment of an employee as defined in this section or of a person for whom the employer has provided voluntary coverage pursuant to section 386-4.

     "Department" means the department of labor and industrial relations.

     "Director" means the director of labor and industrial relations.

     "Disability" means loss or impairment of a physical or mental function.

     "Disciplinary action" means personnel action by an employer in the form of punishment against an employee for infraction of employer or contract rules, in the form of a reprimand, suspension, or discharge.

     "Emergency medical services" means the delivery of health care services under emergency conditions occurring as the result of a patient's condition due to a work injury that manifests itself by symptoms of sufficient severity, including severe pain, such that a prudent layperson, who possesses an average knowledge of health and medicine, could reasonably expect the absence of immediate medical attention to be life-threatening or cause serious harm or aggravation of physiological or psychological sickness, injury, or incapacitation.

     "Employee" means any individual in the employment of another person.
     Where an employee is loaned or hired out to another person for the purpose of furthering the other person's trade, business, occupation, or profession, the employee shall, beginning with the time when the control of the employee is transferred to the other person and continuing until the control is returned to the original employer, be deemed to be the employee of the other person regardless of whether the employee is paid directly by the other person or by the original employer. The employee shall be deemed to remain in the sole employment of the original employer if the other person fails to secure compensation to the employee as provided in section 386-121.
      Whenever an independent contractor undertakes to perform work for another person pursuant to contract, express or implied, oral or written, the independent contractor shall be deemed the employer of all employees performing work in the execution of the contract, including employees of the independent contractor's subcontractors and their subcontractors. However, the liabilities of the direct employer of an employee who suffers a work injury shall be primary and that of the others secondary in their order. An employer secondarily liable who satisfies a liability under this chapter shall be entitled to indemnity against loss from the employer primarily liable.

      "Employee in comparable employment" means a person, other than the injured employee, who is employed in the same grade in the same type of work by the same employer or, if there is no person so employed, a person, who is employed in the same grade in the same type of work by another employer in the same district.

      "Employer" means any person having one or more persons in the person's employment. It includes the legal representative of a deceased employer and the State, any county or political subdivision of the State, and any other public entity within the State.       The insurer of an employer is subject to the employer's liabilities, shall pay the deductible as provided for under section 386-100, shall collect the amount of the deductible from the employer, and be entitled to rights and remedies under this chapter as far as applicable.
      The workers' compensation self-insurance group of which an employer is a member is subject to that employer's liabilities and entitled to rights and remedies under this chapter as far as applicable.

      "Employment" means any service performed by an individual for another person under any contract of hire or apprenticeship, express or implied, oral or written, whether lawfully or unlawfully entered into. It includes service of public officials, whether elected or under any appointment or contract of hire, express or implied.
      "Employment" does not include:

(1) Service for a religious, charitable, educational, or nonprofit organization if performed in a voluntary or unpaid capacity;
(2) Service for a religious, charitable, educational, or nonprofit organization if performed by a recipient of aid therefrom and the service is incidental to or in return for the aid received;
(3) Service for a school, college, university, college club, fraternity, or sorority if performed by a student who is enrolled and regularly attending classes and in return for board, lodging, or tuition furnished, in whole or in part;
(4) Service performed by a duly ordained, commissioned, or licensed minister, priest, or rabbi of a church in the exercise of the minister's, priest's, or rabbi's ministry or by a member of a religious order in the exercise of nonsecular duties required by the order;
(5) Service performed by an individual for another person solely for personal, family, or household purposes if the cash remuneration received is less than $225 during the current calendar quarter and during each completed calendar quarter of the preceding twelve-month period;
(6) Domestic, in-home and community-based services for persons with developmental and intellectual disabilities under the medicaid home and community-based services program pursuant to Title 42 Code of Federal Regulations sections 440.180 and 441.300, and Title 42 Code of Federal Regulations, Part 434, Subpart A, as amended, or when provided through state funded medical assistance to individuals ineligible for medicaid, and identified as chore, personal assistance and habilitation, residential habilitation, supported employment, respite, and skilled nursing services, as the terms are defined by the department of human services, performed by an individual whose services are contracted by a recipient of social service payments and who voluntarily agrees in writing to be an independent contractor of the recipient of social service payments;
(7) Domestic services, which include attendant care, and day care services authorized by the departmejt of human services under the Social Security Act, as amended, or when provided through stste-funded medical assistance to individuals ineligible for medicaid, when performed by an individual in the employ of a recipient of social service payments. For the purposes of this paragraph only, a "recipient of social service payments" is a person who is an eligible recipient of social services such as attendant care or day care services;
(8) Service performed without wages for a corporation without employees by a corporate officer in which the officer is at least a twenty-five per cent stockholder;
(9) Service performed by an individual for a corporation if the individual owns at least fifty per cent of the corporation; provided that no employer shall require an employee to incorporate as a condition of employment;
(10) Service performed by an individual for another person as a real estate salesperson or as a real estate broker, if all the service performed by the individual for the other person is performed for remuneration solely by way of commission;
(11) Service performed by a member of a limited liability company if the member is an individual and has a distributional interest, as defined in section 428-101, of not less than fifty per cent in the company; provided that no employer shall require an employee to form a limited liability company as a condition of employment;
(12) Service performed by a partner of a partnership, as defined in section 425-101, if the partner is an individual; provided that no employer shall require an employee to become a partner or form a partnership as a condition of employment;
(13) Service performed by a partner of a limited liability partnership if the partner is an individual and has a transferable interest as described in section 425-127 in the partnership of not less than fifty per cent; provided that no employer shall require an employee to form a limited liability partnership as a condition of employment; and
(14) Service performed by a sole proprietor.
As used in this definition, "religious, charitable, educational, or nonprofit organization" means a corporation, unincorporated association, community chest, fund, or foundation organized and operated exclusively for religious, charitable, or educational purposes, no part of the net earnings of which inure to the benefit of any private shareholder or individual.

     "Good cause" means a substantial reason amounting in law to be a legal excuse for failing to perform an act required by law considered under the circumstances of the individual case.

     "Guide" or "guidelines" means an indication of a suggested criteria, course, or means to a particular end, and not an authoritative or exclusive prescription which limits the exercise of independent judgment, expertise, or care.

     "Health care provider" means a person qualified by the director to render health care and service and who has a license for the practice of:

(1) Medicine or osteopathy under chapter 453;
(2) Dentistry under chapter 448;
(3) Chiropractic under chapter 442;
(4) Naturopathic medicine under chapter 455;
(5) Optometry under chapter 459;
(6) Podiatry under chapter 463E; and
(7) Psychology under chapter 465.
     "Medical care", "medical services", or "medical supplies" means every type of care, treatment, surgery, hospitalization, attendance, service, and supplies as the nature of the work injury requires, and includes such care, services, and supplies rendered or furnished by a licensed or certified physician, dispensing optician, physical therapist, physical therapist assistant as recognized pursuant to section 461J-3(e), nurse, advanced practice registered nurse as recognized pursuant to chapter 457, occupational therapist, certified occupational therapy assistant as recognized pursuant to chapter 457G, or licensed massage therapist as recognized pursuant to chapter 452.

     "Personal injury" includes death resulting therefrom.

     "Physician" includes a doctor of medicine, a dentist, a chiropractor, an osteopath, a naturopathic physician, a psychologist, an optometrist, and a podiatrist.

     "Psychologist" means a licensed clinical psychologist with a doctorate degree in psychology and who either has at least two years clinical experience in a recognized health setting, or has met the standards of the National Register of the Health Service Providers in Psychology. When treatment or evaluation for an injury is provided by a psychologist, provision shall be made for appropriate medical collaboration when requested by the employer or the insurer, as provided by rules adopted in conformance with chapter 91.

     "Recipient of social service payments" includes:

(1) A person who is an eligible recipient of social services such as attendant care and day care services; and
(2) A corporation or private agency that contracts directly with the department of human services to provide attendant care and day care authorized under the Social Security Act, as amended.
     "State average weekly wage" means the amount determined by the director under section 383-22 as the average weekly wage.

     "Suitable gainful employment" means disability of such an extent that the disabled employee has no reasonable prospect of finding regular employment of any kind in the normal labor market.

     "Total disability" means disability of such an extent that the disabled employee has no reasonable prospect of finding regular employment of any kind in the normal labor market.

     "Trade, business, occupation, or profession"means all commercial, occupational, or professional activities, whether conducted for pecuniary gain or not. It includes all activities of nonprofit organizations conducted in pursuit of their purposes.

     "Usual and customary employment" means the line or type of work in the gainful employment market consistent with a claimant's background, training, and experience.

     "Vocational rehabilitation plan" means an approved plan prepared by a certified rehabilitation provider with an employee that is designed to assist the employee in obtaining and maintaining suitable gainful employment.

     "Vocational rehabilitation services" means services provided in a rehabilitation program to assist an employee in obtaining and maintaining suitable gainful employment that may include but shall not be limited to on-the-job training, job modification, vocational evaluation, adjustment to disability, counseling, guidance, vocational and personal adjustment, referrals, transportation, training, supplies, equipment, appliances, aid, occupational licenses, and other goods and services needed to assist an employee in obtaining and maintaining suitable gainful employment.

     "Wages" means all remuneration for services constituting employment. It includes the market value of board, lodging, fuel, and other advantages having a cash value which the employer has paid as a part of the employee's remuneration and gratuities received in the course of employment from others than the employer to the extent that they are customary and expected in that type of employment or accounted for by the employee to the employer.

     "Work injury" means a personal injury suffered under the conditions specified in section 386-3. [L 1963, c 116, pt of §1; Supp, §97-1; HRS §386-1; am L 1969, c 224, §2a; am L 1970, c 200, §1; am L 1974, c 153, §1; am L 1975, c 68, §1; am L 1978, c 110, §4; am L 1979, c 40, §1; am imp L 1984, c 90, §1; am L 1985, c 296, §§4, 14; am L 1986, c 304, §2; am L 1987, c 339, §4 and c 374, §1; am L 1989, c 56, §§1, 2 and c 300, §4; am L 1993, c 363, §2; am L 1999, c 222, §2; am L 2000, c 69, §2; am L 2003, c 171, §1; am Sp L 2005, c 11, §1; am L 2006, c 176, §2; am L 2007, c 259, §§3, 7; am L 2009, c 11, §47; am L Sp 2009, c 22, §11(2); am L 2010, c 4, §6; am L 2011, c 196, §1 and c 220, §15; am L 2012, c 157, §1 and c 158, §2]

Attorney General Opinions
     Prisoners compensated under §353-25 are not covered by this chapter. Att Gen. Op. 69-11.

Law Journals and Reviews
     Torts and Workers' Compensation, James E. Koshiba, 2 UH L. Rev. 209.

Case Notes
      Prior law, L 1915, c 221 held constitutional. 24 H. 97; 26 H. 737; 28 H. 383.

     Effect of 1963 amendment. 48 H. 288, 398 P.2d 154.

     Company is liable to employee of its contractor. 23 H. 291. Owner of premises held employer of employee of independent contractor. 41 H. 603. Under definition of "employer" as it read prior to 1963 revision, general contractor was not "employer" of a subcontractor's employee. 50 H. 293, 439 P.2d 669.

     Law must be broadly and liberally construed. 23 H. 291; 24 H. 324; 24 H. 731; 26 H. 737. Act should be given liberal construction to accomplish its beneficent purposes. 52 H. 595, 483 P.2d 187.

     Employer defined. 31 H. 102. Wages defined. 33 H. 412.

     Independent contractor. 32 H. 373. Third-party general contractors are not immune to common law negligence actions by employees of their subcontractors. 54 H. 578, 513 P.2d 156.

     Factors to be considered in determining the employer in loaned-employee cases. 56 H. 544, 545 P.2d 687.

     Casual employment excluded. 32 H. 735. Student employees, coverage of. 52 H. 595, 483 P.2d 187.

     Factors to be considered in determining the employer in lent employee cases. 59 H. 139, 577 P.2d 787.

     "Disability", "total disability" referred to. 59 H. 409, 583 P.2d 321.

     Control of employee is the predominant consideration in fixing compensation liability between a lending and a borrowing employer. 63 H. 374, 628 P.2d 629.

     Sole director and stockholder of corporation was "employee". 63 H. 642, 636 P.2d 721.

     Intent is to place primary responsibility on subcontractor to obtain workers' compensation coverage; construing contract insurance policies to cover workers' compensation claims would frustrate intent. 69 H. 37, 731 P.2d 167.

     Licensed real estate agents who performed sales activities pursuant to independent contractor agreements were independent contractors, and not employees. 79 H. 208, 900 P.2d 784.

     Section assigns secondary liability for workers' compensation benefits to next subcontractor above primarily liable employer in default regardless of whether that subcontractor carries workers' compensation insurance mandated by Hawaii law. 83 H. 1, 924 P.2d 169.

     Cited: 25 H. 747, 751; 31 H. 554; 31 H. 638, 648; 32 H. 928, 932; 37 H. 517, 523; 41 H. 442, 446.

     §386-2 Definitions relating to family relationships.
     "Brother" or "sister" includes a half brother or half sister, a stepbrother or stepsister and a brother or sister by adoption.
     "Child" includes a posthumous child, adopted child, stepchild, child born to parents not married to each other, and hanai child acknowledged prior to the personal injury.
     "Grandchild" includes a child of an adopted child and a child of a stepchild, but does not include a stepchild of a child.
     "Grandparent" includes a parent of a parent by adoption, but does not include a parent of a stepparent, a stepparent of a parent, or a stepparent of a stepparent.
     "Parent" includes a stepparent or a parent by adoption. [L 1963, c 116, pt of §1; Supp, §97-2; HRS §386-2; am L 1982, c 193, §1, §1; am L 1997, c 52, §1]

Case Notes
      Construed. 31 H. 814.

     §386-3 Injuries covered. (a) If an employee suffers personal injury either by accident arising out of and in the course of the employment or by disease proximately caused by or resulting from the nature of the employment, the employee's employer or the special compensation fund shall pay compensation to the employee or the employee's dependents as provided in this chapter.
      Accident arising out of and in the course of the employment includes the wilful act of a third person directed against an employee because of the employee's employment.

     (b) No compensation shall be allowed for an injury incurred by an employee by the employee's wilful intention to injure oneself or another or by the employee's intoxication.

     (c) A claim for mental stress resulting solely from disciplinary action taken in good faith by the employer shall not be allowed; provided that if a collective bargaining agreement specifies a different standard than good faith for disciplinary actions, the standards set in the collective bargaining agreement or other employment agreement shall be applied in lieu of the good faith standard. For purposes of this subsection, the standards set in the collective bargaining agreement or other employment agreement shall be applied in any proceeding before the department, the appellate board, and the appellate courts. [L 1963, c 116, pt of §1; Supp, §97-3; HRS §386-3; am imp L 1984, c 90, §1; am L 1998, c 224, §2]

Cross References
      Police officers injured while off duty covered, see §52-5.

Attorney General Opinions
      Where employee at work is injured and dies as a result of an assault by a third party, compensation should be awarded notwithstanding the assault may have arisen from personal matters. Att. Gen. Op. 73-4.

Law Journals and Reviews
      Suicide was compensable injury by disease caused by the employment. Haw Supp, 4HBJ, Nov. 1966, at 24. Death by heart attack was not compensable because there was no casual relationship between work and death, Haw. Supp, 5 HBJ 38.

Case Notes
      Definitions: "Out of" and "in the course of". 24 H. 324. "By accident", "arising out of", and "course of employment". 26 H. 785; 37 H. 556; 38 H. 384; 40 H. 660. Course of employment. 66 F. Supp. 875; 34 H. 221. Covers workers under nonmaritime contract of employment injured aboard ship. 26 H. 737.

      Causal connection. 33 H. 576.

      Cancer. 34 H. 717. On death from cerebral hemorrhage as arising out of employment. 43 H. 94. Reasonable evidence of disease proximately caused. 43 H. 337.

      Where employee is injured on a business trip, employee's personal activities preceding the business activity are immaterial. 52 H. 242, 473 P.2d 561.

      Mental disabilities arising out of employment are compensable. 53 H. 32, 487 P.2d 278.

      Injury occurring off the premises during a coffee break is compensable if it occurred in course of reasonable and necessary activity incident to such break. 54 H. 66, 502 P.2d 1399.

      Influenza is a compensable injury. 59 H. 551, 584 P.2d 119.

      "Work connection" test to decide whether heart attack arose out of and in course of employment. 63 H. 642, 636 P.2d 721.

      Employee suffered work-related injury when employee sustained a psychogenic disability due to employee's employment. 714 F. Supp. 1108.

      Claimant’s act of returning to claimant’s employer’s premises for the sole purpose of retrieving a piece of cake for claimant’s personal enjoyment bore no relation to an incident or condition of claimant’s employment; accordingly, there was no causal connection between claimant’s injury and any incident or condition of that employment. 77 H. 100, 881 P.2d 1246.

      Employee's psychological stress injury not compensable as injury was direct consequence of disciplinary action imposed on employee for altering time cards and this prohibited conduct exceeded bounds of employment duties. 80 H. 120, 906 P.2d 127.

      Employee's injury suffered in crossing public street between employer's office and parking lot not in course of employment as parking lot not part of employer's "premises"; employer's office lease merely allowed employees to enter into independent parking stall rental contract with building management. 80 H. 150, 907 P.2d 101.

      Injury did not arise in the course of employment where assault on claimant, though occurring on employer's premises, emanated from personal dispute over auto accident. 80 H. 442, 911 P.2d 77.

      Where teacher-claimant allegedly administered corporal punishment in violation of work-rule prohibiting such conduct, claimant nevertheless sustained compensable stress-related injury from subsequent discipline as claimant was acting within course of employment at time of alleged misconduct. 85 H. 250, 942 P.2d 514.

      An employee's injury caused by a disease is compensable as an "injury by disease", pursuant to this section, when the disease (1) is caused by conditions that are characteristic of or peculiar to the particular trade, occupation, or employment, (2) results from employee's actual exposure to such working conditions, and (3) is due to causes in excess of the ordinary hazards of employment in general. 94 H. 70, 9 P.3d 382.

      In order to identify the "date of injury" required by the department of labor in connection with the filing of a workers' compensation claim under §386-82, a claimant in a case arising under the "injury-by-disease" prong of this section may rely upon the last day of employment as the "date of disability", but this "date of disability" may also be the date of diagnosis of the disabling condition. 94 H. 70, 9 P.3d 382.

      Under the doctrine of substantial deviation, employee was precluded from compensability for injuries received when trying to return employer's vehicle to employer's baseyard over seven hours after normal workday ended where employee left the scope of employment to embark on a purely personal and unauthorized journey to correct a sewer line problem on girlfriend's property halfway around the island, and had dinner, a few beers and a nap at the girlfriend's house. 100 H. 285, 59 P.3d 920.

      Although employee was not physically injured while taking promotion test, psychological injuries employee sustained caused by employee's dissatisfaction with the process for ranking individuals and the overall grievance and promotion process was compensable; injury that stemmed from that promotion process was incidental to the employment and resulted from an activity that served an important interest of the employer. 100 H. 481, 60 P.3d 882.

      Employee’s injury not compensable where employee’s injury occurred on public sidewalk outside of employer’s business premises, did not occur during a lunch or recreation period, did not occur as an incident of employee’s employment, employer did not expressly or impliedly bring after-hours drinking party within employee’s orbit of employment and party did not benefit employer in any way. 87 H. 492 (App.), 960 P.2d 162.

      Cited: 2 F. Supp. 2d 1295.

      Cited: 24 H. 731, 733.

     §386-3.5 Negotiation for benefit coverage. (a) Notwithstanding any provision of law to the contrary, any employer may determine the benefits and coverage of a policy required under this chapter through collective bargaining with an appropriate bargaining unit; provided that the bargained agreement shall be reviewed by the director to ensure that the agreement does not provide benefits and coverage less than those provided in this chapter. The director shall approve the agreement within ninety days after submittal upon a finding that the agreement provides the benefits and coverage required. This section shall not apply to collective bargaining contracts negotiated pursuant to chapter 89. The director may adopt rules pursuant to chapter 91 to implement this section.

(b) This section shall apply only to collective bargaining agreements negotiated subsequent to June 29, 1995. [L 1995, c 234, §1]


      Section enacted as addition to part II, is codified to this part pursuant to §23G-15.

      "June 29, 1995" substituted for "the effective date of this Act".

     §386-4 Voluntary coverage. Any employer who has individuals in the employer's employment who are not employees as defined in section 386-1 may elect to provide coverage for them under this chapter. During the period for which the election is effective the employer and the individuals in the employer's employment covered thereby shall be deemed to be employees and be subject in all respects to this chapter.
     Election by any employer to provide coverage under this chapter shall be made by securing compensation to the individuals in the employer's employment affected thereby in the manner provided in section 386-121 and giving the notice prescribed by section
386-121 and giving the notice prescribed by section 386-122.
    Every employer who elects to provide coverage under the terms of this section shall be bound by the election until January 1 of the next succeeding year and for terms of one year thereafter. Any such employer may elect to discontinue the coverage for personal injuries occurring after the expiration of any such calendar year by filing notice of the election with the director of labor and industrial relations at least sixty days prior to the expiration of any such calendar year and at the same time posting notices to that effect conspicuously in such places of work that they can reasonably be expected to come to the attention of all individuals affected thereby. [L 1963, c 116, pt of §1; Supp, §97-4; HRS §386-4; gen ch 1985]

Case Notes
      Cited; 41 H. 603, 605.

     §386-5 Exclusiveness of right to compensation; exception. The rights and remedies herein granted to an employee or the employee's dependents on account of a work injury suffered by the employee shall exclude all other liability of the employer to the employee, the employee's legal representative, spouse, dependents, next of kin, or anyone else entitled to recover damages from the employer, at common law or otherwise, on account of the injury, except for sexual harassment or sexual assault and infliction of emotional distress or invasion of privacy related thereto, in which case a civil action may also be brought. [L 1963, c 116, pt of §1; Supp, §97-5; HRS §386-5; am imp L 1984, c 90, §1; am L 1992, c 275, §2]

Case Notes
      Statute provides exclusive remedy against fellow employees for work-related injuries. 818 F.2d 210.

      Emotional distress claim was barred. 899 F.2d 845.

      Since Hawaii law bars action for contribution by a third party tortfeasor against the plaintiff's employer, it would preclude employee of government contractor from recovering from the United States the full amount of employee's damages where a portion of those damages were attributable to negligence of the employer. 473 F. Supp. 1077.

      Injured seaman, section does not oust admiralty court of its jurisdiction. 557 F. Supp. 1024.

      No indemnity from United States available to asbestos manufacturers sued for asbestos-related diseases. 603 F. Supp. 599.

      Remedy exclusive. 611 F. Supp. 1285.

      Exclusive remedy for emotional distress claims. 720 F. Supp. 829.

      Claim of negligent or intentional infliction of emotional distress preempted by workers' compensation law. 763 F. Supp. 1544; 768 F. Supp. 734.

      Section, as amended, could not be applied retroactively. 910 F. Supp. 479.

      Barred emotional distress claims where no sexual harassment or sexual assault alleged. 938 F. Supp. 1503.

      Defendant's motion for partial dismissal denied, where defendant sought dismissal of all negligence-based claims in the action and the gravamen of the motion was that exclusivity provision of Hawaii's workers' compensation statute barred all work-related actions sounding in negligence. 112 F. Supp. 2d 1041.

      Exclusivity provision barred plaintiff's negligence-based counts against defendants, where the counts arose "on account" of a work injury suffered by plaintiff; exception provided in exclusivity provision did not afford plaintiff a cause of action, where plaintiff did not allege sexual harassment or sexual assault. 266 F. Supp. 2d 1233.

      Barred plaintiff's claim for negligent infliction of emotional distress, where plaintiff did not claim sexual harassment or assault. 284 F. Supp. 2d 1261.

      Exclusive remedy. 24 H. 97; 28 H. 383. History; purpose of Workmen's Compensation Act; exclusiveness of remedy. 41 H. 442. Exclusiveness of remedy, bars wrongful death action. 42 H. 518. Exclusiveness of remedy. 52 H. 595, 483 P.2d 187.

      Right of employee of subcontractor to workers' compensation from the subcontractor did not exclude remedy against general contractor. 50 H. 293, 439 P.2d 669.

      Employer may be liable for indemnity based on breach of indemnity agreement. 54 H. 153, 504 P.2d 861.

      Section precludes defendant in tort action from obtaining contribution from employer on theory that the employer was a joint tortfeasor. 54 H. 153, 504 P.2d 861; 56 H. 598, 546 P.2d 527; 67 H. 357, 688 P.2d 1139; 68 H. 22, 702 P.2d 722.

      Section precludes third party tortfeasor from bringing action against employer for contribution. 55 H. 375, 520 P.2d 62.

      Third party general contractors are not immune to common law negligence actions by employees of their subcontractors. 55 H. 578, 513 P.2d 156.

      Section does not preclude per se, third party's indemnity claim against employer. 65 H. 232, 649 P.2d 1149.

      Where subcontractor fails to provide benefits to its injured worker and the general contractor pays those benefits, the latter is immunized from negligence action brought by injured worker. 66 H. 568, 670 P.2d 457.

      Section does not preclude per se, third party's indemnity claim against employer. 68 H. 171, 707 P.2d 365.

      Owner of premises who hired an independent contractor to do work on the premises was not considered an employer. 70 H. 501, 777 P.2d 1183.

      Court did not adopt dual capacity doctrine; found exclusivity of the workers' compensation law constitutional. 71 H. 358, 791 P.2d 1257.

      Claimant not precluded by exclusivity provision of this section from seeking common law tort remedies against employer's insurer where injuries allegedly caused by insurer's denial of medical benefits and disability payments not "work injuries" within scope of chapter 386. 83 H. 457, 927 P.2d 858.

      This chapter does not bar relief on claims filed with the civil rights commission. 85 H. 7, 936 P.2d 643.

      Where statutory employer secured workers’ compensation coverage as required under this chapter by paying a fee for that purpose to the lending employer, and employee received a statutory award for work-connected injuries, statutory employer was entitled to tort immunity. 88 H. 140, 963 P.2d 349.

      Where employer newspaper hired newspaper carrier as "independent contractor" under the express terms of employer’s own agreement, employer was estopped from claiming tort protection under this section unless and until injured carrier challenged the form-over-substance nature of the agreement and was awarded workers’ compensation benefits by the director or appeals board. 89 H. 411, 974 P.2d 51.

      Where plaintiff's claims did not arise under this chapter, the exclusive remedy and original jurisdiction provisions in the workers' compensation statute did not apply, and where plaintiff's claims for relief of tortious conduct on the part of workers' compensation insurer were not within the original jurisdiction of the labor director, trial court erred in granting summary judgment on that basis. 90 H. 407, 978 P.2d 845.

      Section bars neither a minor's tort claims for the minor's in utero injuries, nor any otherwise valid claims of any other party that allegedly derive from minor's injuries. 91 H. 146, 981 P.2d 703.

      The exclusive remedy provision of the workers' compensation law does not bar claims for negligent infliction of emotional distress related to sexual harassment. 97 H. 376, 38 P.3d 95.

      Bars third party's indemnity claim against employer where latter owed no duty to third party. 6 H. App. 525, 735 P.2d 939.

      Exclusive remedy for claims of negligent and intentional infliction of emotional distress. 9 H. App. 21, 821 P.2d 937.

      An employee may bring action against employer for intentional infliction of emotional distress caused by discrimination in violation of §378-2, and this action is not barred by exclusivity provision of this section. 87 H. 57 (App.), 951 P.2d 507.

      Section does not bar a child from bringing a tort action against mother's employer for in utero injuries child personally sustained, allegedly as a result of a work-related accident involving the mother. 91 H. 157 (App.), 981 P.2d 714.

     Where record revealed that the parties disputed at least two material facts--whose work was being done by plaintiff when plaintiff was injured and who controlled plaintiff's work at the job site--defendant failed to produce evidence that defendant was a "statutory employer" for workers' compensation purposes; thus, circuit court erred in granting summary judgment to defendant because defendant had not demonstrated that it was immune from suit and was therefore entitled to judgment as a matter of law. 124 H. 230 (App.), 239 P.3d 1280.

      Cited: 23 H. 291, 294; 56 H. 544, 545 P.2d 687.

     §386-6 Territorial applicability. The provisions of this chapter shall be applicable to all work injuries sustained by employees within the territorial boundaries of the State.
      If an employee who has been hired in the State suffers work injury, he shall be entitled to compensation under this chapter even though the injury was sustained without the State. The right to compensation shall exclude all other liability of the employer for damages as provided in section 386-5. All contracts of hire of employees made within the State shall be deemed to include an agreement to that effect.
      If an employee who has been hired without the State is injured while engaged in his employer's business, and is entitled to compensation for the injury under the law of the state or territory where he was hired, he shall be entitled to enforce against his rights in this State if his rights are such that they can reasonably be determined and dealt with by the director of labor and industrial relations, the appellate board, and the court in this State. [L 1963, c 116, pt of §1; Supp, §97-6; HRS §386-6]

Case Notes
      Claimant not entitled to rely on foreign law where in proceedings below, she not only failed to rely on foreign law but affirmatively relied on Hawaii law. 54 H. 98, 503 P .2d 434.

      Employee "hired in the State" construed. 59 H. 551, 584 P .2d 119. Not exclusive remedy where emotional distress is caused by wilful and wanton conduct of corporate officer. 720 F. Supp. 829.

     §386-7 Interstate and foreign commerce and maritime employment. To the extent permissible under the Constitution and the laws of the United States, this chapter shall apply to employees and employers engaged in interstate and foreign commerce and to employees in maritime employment and their employers not otherwise provided for by the laws of the United States. [L 1963, c 116, pt of §1; Supp, §97-7; HRS §386-7]

Case Notes
      Employment of all decedents, circumstances of death, and purpose of mission bore significant relationship to traditional maritime activity. 557 F. Supp. 1024.

     §386-8 Liability of third person. When a work injury for which compensation is payable under this chapter has been sustained under circumstances creating in some person other than the employer or another employee of the employer acting in the course of his employment a legal liability to pay damages on account thereof, the injured employee or his dependents (hereinafter referred to collectively as the employee) may claim compensation under this chapter and recover damages from such third person.
      If the employee commences an action against such third person he shall without delay give the employer written notice of the action and the name and location of the court in which the action is brought by personal service or registered mail. The employer may, at any time before trial on the facts, join as party plaintiff.
      If within nine months after the date of the personal injury the employee has not commenced an action against such third person, the employer, having paid or being liable for compensation under this chapter, shall be subrogated to the rights of the injured employee. Except as limited by chapter 657, the employee may at any time commence an action or join in any action commenced by the employer against such third person.
      No release or settlement of any claim or action under this section is valid without the written consent of both employer and employee. The entire amount of the settlement after deductions for attorney's fees and costs as hereinafter provided, is subject to the employer's right of reimbursement for his compensation payments under this chapter and his expenses and costs of action.
      If the action is prosecuted by the employer alone, the employer shall be entitled to be paid from the proceeds received as a result of any judgment for damages, or settlement in case the action is compromised before judgment, the reasonable litigation expenses incurred in preparation and prosecution of such action, together with a reasonable attorney's fee which shall be based solely upon the services rendered by the employer's attorney in effecting recovery both for the benefit of the employer and the employee. After the payment of such expenses and attorney's fee, the employer shall apply out of the amount of the judgment or settlement proceeds an amount sufficient to reimburse the employer for the amount of his expenditure for compensation and shall pay any excess to the injured employee or other person entitled thereto.
      If the action is prosecuted by the employee alone, the employee shall be entitled to apply out of the amount of the judgment for damages, or settlement in case the action is compromised before judgment, the reasonable litigation expenses incurred in preparation and prosecution of such action, together with a reasonable attorney's fee which shall be based solely upon the services rendered by the employee's attorney in effecting recovery both for the benefit of the employee and the employer. After the payment of such expenses and attorney's fee there shall be applied out of the amount of the judgment or settlement proceeds, the amount of the employer's expenditure for compensation, less his share of such expenses and attorney's fee. On application of the employer, the court shall allow as a first lien against the amount of the judgment for damages or settlement proceeds, the amount of the employer's expenditure for compensation, less his share of such expenses and attorney's fee.
      If the action is prosecuted both by the employee and the employer, in a single action or in consolidated actions, and they are represented by the same agreed attorney or by separate attorneys, there shall first be paid from any judgment for damages recovered, or settlement proceeds in case the action or actions be settled before judgment, the reasonable litigation expenses incurred in preparation and prosecution of such action or actions, together with reasonable attorney's fees based solely on the services rendered for the benefit of both parties where they are represented by the same attorney, and where they are represented by separate attorneys based solely upon the serviced rendered in each instance by the attorney in effecting recovery for the benefit of the party represented. After the payment of such expenses and attorney's fees there shall be applied out of the amount of the judgment for damages, or settlement proceeds an amount sufficient to reimburse the employer for the amount of his expenditure for compensation and any excess shall be paid to the injured employee or other person entitled thereto.
      In the event that the parties are unable to agree upon the amount of reasonable litigation expenses and the amount of attorneys' fees under this section then the same shall be fixed by the court.
      After reimbursement for his compensation payments the employer shall be relieved from the obligation to make further compensation payments to the employee under this chapter up to the entire amount of the balance of the settlement or the judgment, if satisfied, as the case may be, after deducting the costs and expenses, including attorneys' fees.
      The amount of compensation paid by the employer or the amount of compensation to which the injured employee is entitled shall not be admissible in evidence in any action brought to recover damages.
      Another employee of the same employer shall not be relieved of his liability as a third party, if the personal injury is caused by his wilful and wanton misconduct.
      If the special compensation fund has paid or is liable for any compensation under this chapter, the fund shall be entitled to all the rights and remedies granted an employer under this section; provided that the employer's right to reimbursement for compensation payments and expenses under this chapter shall have priority. [L 1963, c 116, pt of §1; Supp, §97-8; am L 1967, c 53, §1; HRS §386-8; am L 1969, c 13, §1; am L 1970, c 58, §1; am L 1973, c 144, §1]

Cross References
      Mailing of notice, see §1-28.

Rules of Court
      Consolidation of actions, see HRCP rule 42.

      Intervention, see HRCP rule 24.

Case Notes
     Employer or insurance carrier may be required to pay share of attorney's fees proportionate to total amount of compensation benefits it would have had to pay but for settlement of third party action. 625 F.2d 314.

     Did not allow claim against defendant individually for negligent infliction of emotional distress; section may allow claim for intentional infliction of emotional distress. 938 F. Supp. 1503.

     Damages awarded against third party. 23 H. 524. Election, employer or third party. 32 H. 446. Suit by next friend appointed solely for that purpose, not an election. 32 H. 928.

     Section not applicable when person for whose compensation the carrier is liable is the widow of the decedent whose death was caused by the wrongful act or neglect of a third person. 32 H. 153.

     Negligence suit may be filed by an employee of a subcontractor against the general contractor and general contractor's employees. 50 H. 293, 439 P.2d 669.

     Employer entitled to attorney's fees out of judgment recovered from third party tortfeasor but not out of settlement claim. 51 H. 437, 462 P.2d 196.

     Section preserves employee's right of action in common law or under a statute against a third party; it does not establish an independent claim. 63 H. 273, 626 P.2d 182.

     Co-employee liable to injured employee or nonemployee third-party plaintiff for injury caused by co-employee's wilful and wanton misconduct. 68 H. 22, 702 P.2d 772.

     Notwithstanding the language of this statute, disclosure of workers' compensation evidence, including the amount, may be appropriate where some relevant purpose for allowing its admission develops in trial. 79 H. 14, 897 P.2d 941.

     Employer's reliance on the provisions of this section was reasonable; employer had no duty to intervene until it knew or reasonably should have known that plaintiff would dismiss plaintiff's claims against defendant without consent. 79 H. 352, 903 P.2d 48.

     Where plaintiff stipulated to dismiss plaintiff's claims against defendant without the written consent of plaintiff's employer, the stipulation dismissing all claims with prejudice was invalid. 79 H. 352, 903 P.2d 48.

     Co-employee liability claims based on "wilful and wanton misconduct" must be proven by clear and convincing evidence. 82 H. 1, 919 P.2d 263.

     "Wilful and wanton misconduct" exception to co-employee immunity under this section includes reckless conduct, where specific intent by co-employee to cause injury is not required. 82 H. 1, 919 P.2d 263.

     Under §386-73, this section, and Hawaii administrative rule §12-10-31, a settlement or compromise of future workers' compensation benefits cannot be valid or binding without the consent or approval of the director of labor and industrial relations. 90 H. 152, 977 P.2d 160.

     Under this section, the employer must bear a proportionate share of the employee's attorney's fees and costs incurred while pursuing recovery from a third party tortfeasor; the employer, and/or its workers' compensation insurance carrier, must bear its share of the employee's attorney's fees and costs in proportion to the present and future benefits derived from a third party settlement or judgment. 92 H. 515, 993 P.2d 549.

     Assuming defendants' claims for "unreasonable failure to consent" and "negligent claims handling" fell within the interference with contract rights exception of §662-15(4), it could not be said that the State improperly interfered with the alleged settlement agreement because, pursuant to this section, the State was a necessary party to such agreement. 114 H. 202, 159 P.3d 814.

     There is nothing in the case law or in the legislative history of this section to support the imposition of a duty on employers in favor of tortfeasors regarding consent to a third-party settlement; thus, trial court did not err in ruling that the State did not owe defendants an actionable duty and thus, did not err in dismissing defendants' cross-claim against the State. 114 H. 202, 159 P.3d 814.

     Trial court did not abuse its discretion in setting aside the stipulation to dismiss the case with prejudice where, pursuant to this section, neither the settlement nor the stipulation was valid without the State's written consent; this section's plain and unambiguous language required the State to consent in writing to validate the settlement between the parties, and the State's letter did not constitute written consent to the settlement as required, but had instead proposed an alternative settlement. 114 H. 202, 159 P.3d 814.

     Where an employee pursues a third-party action "alone", this section requires that an employer is only entitled to a first lien in the amount of its workers' compensation expended, less the employer's "share" of attorneys' fees and expenses. 92 H. 524 (App.), 993 P.2d 558.

     Where employer intervened before any trial on the facts, trial court did not abuse discretion by allowing employer to intervene. 92 H. 524 (App.), 993 P.2d 558.

     No abuse of discretion in requiring insurance company to pay one-half of the employee's court expenses. 2 H. App. 344, 631 P.2d 1209.

     Plaintiff permitted to amend pleading to allege cause of action for wilful and wanton misconduct against defendant employees of same employer. 9 H. App. 21, 821 P.2d 937.

     §386-8.5 Limits of third party liability. (a) Section 386-8 and any other law to the contrary notwithstanding, when a work injury for which compensation is payable under this chapter has been sustained, the discussion or furnishing of, or failure to discuss or furnish, or failure to enforce any safety, health, or personal conduct provisions to protect employees against work injuries, in any collective bargaining agreement or in negotiations thereon, shall not subject a labor organization representing the injured employee to any civil liability for the injury.

As used in this section, the terms:

(1) "Labor organization" means any organization which exists and is constituted for the purpose, in whole or in part, of collective bargaining or dealing with employers concerning grievances, terms or conditions of employment, or of other mutual aid or protection and includes both private industry and public employment labor organizations.

(2) "Safety provision" includes, but is not limited to, safety inspections and advisory services; "health provision" includes, but is not limited to, health inspections and advisory services; "personal conduct provision" includes, but is not limited to, contractual language covering sexual harassment or assault and related infliction of emotional distress or invasion of privacy.

     (b) No construction design professional who is retained to perform professional services on a construction project or any employee of a construction design professional who is assisting or representing the construction design professional in the performance of professional services on the site of the construction project shall be liable for any injury on the construction project resulting from the employer's failure to comply with safety standards on the construction project for which compensation is recoverable under this chapter unless the responsibility for the compliance of safety practices is specifically assumed by contract or by other conduct of the construction design professional or any employee of the construction design professional who is assisting or representing the construction design professional in the performance of professional services on the site of the construction project. The limitation of liability provided by this subsection to any construction design professional shall not apply to the negligent preparation of design plans or specifications. [L 1980, c 100, §2; am L 1989, c 300, §3; am L 1992, c 275, §3]

     §386-9 Contracting out forbidden. Except as provided in section 386-78, no contract, rule, regulation or device whatsoever shall operate to relieve the employer in whole or in part from any liability created by this chapter. [L 1963, c 116, pt of §1; Supp, §97-9; HRS §386-9; am L 1969, c 17, §1]

Case Notes
      Section preempted by ERISA to the extent it prohibits offsetting workers' compensation payments intended to provide income replacement against pension benefits. 679 F .2d 1319.

      Offset of pension benefits against workers' compensation benefits prohibited by this section. 504 F. Supp. 958. Cited: 23 H. 291, 294; 31 H. 672, 673.

     §386-10 Out of state employers. Any employer whose principal place of business is outside the State shall, prior to the commencement of employment within the State, register with the director the employer's name, approximate total wages to be paid, and the dates of employment activity within the State. The employer shall file with the director, in the form prescribed by the director, a notice of insurance as required by section 386-122. [L 1986, c 132, §1; am L 1989, c 24, §1]


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