SB 2120 Hawaii Senate · 2026 Regular Session

RELATING TO TRANSFER OF EMPLOYEE BENEFITS.

Summary

Requires the State, Legislature, and counties to amend rules and policies to ensure that certain employees can transfer accrued vacation and sick leaves if rehired by the State or a county within one calendar year of separation under certain conditions. Extends the allowable break in service for purposes of determining certain state and county contributions to the Hawaii Employer-Union Health Benefits Trust Fund from ninety calendar days to 180 calendar dars under certain conditions. Effective 1/1/2077. (SD1)

Issues: ✓ Labor & Employment

Bill status passed 3 of 5 stages cleared

Introduction

Jan 2026

Committee Review

Feb 2026

Senate Passage

Feb 2026

House Passage

Governor

Introduced Jan 14, 2026 Last action Feb 12, 2026

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What changed between versions

SB2120 → SB2120_SD1 · 4 edits

MODERATE

This bill updates Hawaii's employee leave transfer rules to require employees to actively elect the benefit and provide notice within 90 days of separation, rather than assuming the transfer happens automatically. It also changes the allowable break in service for health benefits from one full year to 180 calendar days for employees returning after July 1, 2026, while keeping the 90-day rule for earlier returns.

Scope change

The bill applies to state, county, and legislative employees, modifying how they must opt-in to leave transfers and altering the timeline for maintaining health benefits upon rehiring.

REQUIREMENT

Employees must now actively elect to transfer accrued vacation and sick leave and notify their employer within 90 days of separation, replacing the previous automatic transfer provision.

TIMELINE

The maximum break in service allowed to retain certain health benefits changed from one full year to 180 calendar days for employees returning on or after July 1, 2026, with an option to revert to the 90-day rule.

The effective date of the Act was changed from July 1, 2026, to January 1, 2077.

DEFINITION

The definition of 'employee' was updated to reference section 78-1.5 of the Hawaii Revised Statutes instead of section 88-21.

Floor votes

How they voted

This bill passed the Senate by voice vote (no roll call recorded).

Full legislative history

Actions timeline

Total actions

Key actions

Committee

Feb 12, 2026

Upper · Passed

Report adopted; Passed Second Reading, as amended (SD 1) and referred to WAM.

upper

Feb 12, 2026

Committee

Reported from LBT/EIG (Stand. Com. Rep. No. 2215) with recommendation of passage on Second Reading, as amended (SD 1) and referral to WAM.

upper

Feb 3, 2026

Upper · Passed

The committee(s) on EIG recommend(s) that the measure be PASSED, WITH AMENDMENTS. The votes in EIG were as follows: 4 Aye(s): Senator(s) Wakai, Chang, DeCoite, Richards; Aye(s) with reservations: none ; 0 No(es): none; and 1 Excused: Senator(s) Fevella.

upper

Feb 3, 2026

Upper · Passed

The committee(s) on LBT recommend(s) that the measure be PASSED, WITH AMENDMENTS. The votes in LBT were as follows: 3 Aye(s): Senator(s) Elefante, Lamosao, Ihara; Aye(s) with reservations: none ; 0 No(es): none; and 2 Excused: Senator(s) Moriwaki, Fevella.

upper

Jan 30, 2026

Upper · Passed

The committee(s) on LBT/EIG has scheduled a public hearing on 02-03-26 3:00PM; Conference Room 224 & Videoconference.

upper

Jan 22, 2026

Committee

Referred to LBT/EIG, WAM.

upper

Jan 21, 2026

Introduced

Introduced and passed First Reading.

upper

Jan 14, 2026

Introduced

Pending Introduction.

upper

6 primary · 1 co-sponsor