STAND. COM. REP. NO. 2545

Honolulu, Hawaii

RE: S.B. No. 2137

S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Thirty-Third State Legislature

Regular Session of 2026

State of Hawaii

Sir:

Your Committees on Labor and Technology and Government Operations, to which was referred S.B. No. 2137 entitled:

"A BILL FOR AN ACT RELATING TO PUBLIC EMPLOYMENT,"

beg leave to report as follows:

The purpose and intent of this measure is to:

(1) Authorize state departments, divisions, and agencies to elect to assume hiring and recruitment functions from the Department of Human Resources Development for vacant civil service positions within that department, division, or agency under certain conditions;

(2) Require the Department of Human Resources Development to adopt rules; and

(3) Repeal existing law authorizing state departments, divisions, and agencies to conduct minimum qualification review of applicants for their vacant civil service positions.

Your Committees received testimony in support of this measure from the Department of Labor and Industrial Relations; Hawaiʻi State Public Library System; University of Hawaii Professional Assembly; United Public Workers, AFSCME Local 646, AFL-CIO; and Hawaii Government Employees Association, AFSCME Local 152, AFL-CIO.

Your Committees received testimony in opposition to this measure from the Department of Human Resources Development.

Your Committees find that there has been no improvement in the vacancy rate in the State's public sector leading to employees being overworked. Your Committees further find that recruitment and hiring of vacant civil service positions needs to be decentralized. This measure will improve the State's recruitment procedures to help lower vacancy rates.

Your Committees have amended this measure by:

(1) Making the measure applicable to recruitment and hiring activities initiated after June 30, 2027; and

(2) Inserting an effective date of January 1, 2077, to encourage further discussion.

Your Committees note the concerns expressed by the Department of Human Resources Development that this measure dismantles the State's centralized civil service recruitment model, replacing it with a fragmented agency-by-agency system that weakens uniform merit standards; increases legal, equity, and fiscal risks; duplicates administrative efforts and costs; and removes critical statewide oversight and accountability safeguards. Your Committees further note the Department of Human Resources Development's position that existing delegated hiring authorities and targeted reforms already provide departments with flexibility while preserving consistency, accountability, and defensibility in the civil service system, and that this measure should be applied to agencies but not departments. Your Committee finds that these issues raise concerns that merit further consideration and respectfully requests that subsequent Committees to which this measure is referred consider the matter.

As affirmed by the records of votes of the members of your Committees on Labor and Technology and Government Operations that are attached to this report, your Committees are in accord with the intent and purpose of S.B. No. 2137, as amended herein, and recommend that it pass Second Reading in the form attached hereto as S.B. No. 2137, S.D. 1, and be referred to your Committee on Ways and Means.

Respectfully submitted on behalf of the members of the Committees on Labor and Technology and Government Operations,

________________________________ ANGUS L.K. MCKELVEY, Chair

________________________________ BRANDON J.C. ELEFANTE, Chair