Unpaid and Withheld Wages in Hawaii

Wage disputes are often treated as too small to be worth raising. Hawaii’s wage payment law takes a different view: it fixes the date pay is due, restricts what an employer may take out of a paycheck, and attaches a penalty to unpaid wages on top of the wages themselves.

This page sets out what HRS chapter 388 says. Unlike a discrimination claim, a wage claim does not go through the Hawaii Civil Rights Commission.

When Wages Are Due

HRS §388-2(a) requires every employer to pay all wages due to its employees at least twice during each calendar month, on regular paydays designated in advance by the employer. The statute allows a monthly schedule only where a majority of the employer’s employees, or a majority of a recognized collective bargaining unit, elect it in a secret ballot election under procedures approved by the director of labor and industrial relations. HRS §388-2(b) adds that the earned wages of all employees shall be due and payable within seven days after the end of each pay period.

Final Pay After a Separation

HRS §388-3 sets three different rules depending on how the employment ended, and the difference between them is not cosmetic.

• Discharge. Under §388-3(a), whenever an employer discharges an employee, with or without cause, the employer shall pay the employee’s wages in full at the time of discharge — or, if the discharge occurs at a time and under conditions which prevent immediate payment, not later than the working day following discharge.
• Quitting or resigning. Under §388-3(b), the employer shall pay wages in full no later than the next regular payday, through the regular pay channels or by mail if the employee requests it. But if the employee gives at least one pay period’s notice of intention to quit, the employer shall pay all wages earned by the employee at the time of quitting.
• Suspension or temporary layoff. Under §388-3(c), where work is suspended as a result of a labor dispute, or an employee is for any reason temporarily laid off, the employer shall pay wages earned at the time of suspension or layoff not later than the next regular payday.

The asymmetry is worth noticing: a discharged employee is entitled to be paid immediately, while an employee who resigns without notice waits until the next payday. Giving a full pay period’s notice moves a resigning employee into the immediate-payment category.

What May Not Be Deducted

HRS §388-6 begins from a prohibition rather than a permission: no employer may deduct, retain, or otherwise require to be paid any part or portion of any compensation earned by any employee, except where required by federal or state statute or by court process, or when the deduction is authorized in writing by the employee.

The section then removes several categories from what a written authorization can even cover. Those may not be authorized, or required to be borne by the employee, at all:

• Fines;
• Cash shortage in a common money till, cash box, or register used by two or more persons; or in one under sole control, where the employee is not given an opportunity to account for all moneys received at the start of a shift and all moneys turned in at the end of a shift;
• Fines, penalties, or replacement costs for breakage;
• Losses due to acceptance by an employee of checks which are subsequently dishonored, if the employee is given discretion to accept or reject any check;
• Losses due to defective or faulty workmanship, lost or stolen property, damage to property, default of customer credit, or nonpayment for goods or services received by a customer, if those losses are not attributable to the employee’s wilful or intentional disregard of the employer’s interest; and
• Medical or physical examination or medical report expenses which accrue due to services rendered to an employee or prospective employee, where the examination or report is requested or required by the employer or prospective employer or required by law.

Several of these describe practices that are common enough to seem normal — charging a server for a walkout, docking a cashier for a till shortage, billing a worker for a broken tool. The statute addresses each of them by name.

These Protections Cannot Be Signed Away

HRS §388-8 provides that, except as provided in §388-11, no provision of chapter 388 may in any way be contravened or set aside by private agreement. A term in a handbook, an offer letter, or a signed acknowledgement does not, on its own, change what the chapter requires.

What an Employer Owes When It Does Not Pay

HRS §388-10(a) provides that an employer who fails to pay wages in accordance with the chapter without equitable justification, or who violates the chapter or the administrative rules adopted under it, is liable to the employee — in addition to the wages legally proven to be due — for a sum equal to the amount of unpaid wages and interest at a rate of six per cent per year from the date the wages were due.

The same subsection adds a second liability under §388-10(a)(2): a penalty of not less than $500, or $100 for each violation, whichever is greater. That penalty is not paid to the employee — the statute directs it into the labor law enforcement special fund.

HRS §388-10(b) sets out criminal penalties, and it treats two kinds of conduct differently.

Under §388-10(b)(1), an employer who does not pay the wages of any of its employees in accordance with the chapter — or an officer of a corporation who knowingly permits the corporation to violate the chapter by failing to pay wages — is guilty of a class C felony and, notwithstanding HRS §706-640, is subject to a fine of not less than $500 per offense. The statute provides that each violation is deemed a separate offense.

Under §388-10(b)(2), a different penalty applies to a different act. An employer, or an employer’s agent or an officer or agent of a corporation, who discharges or in any other manner discriminates against an employee because the employee has complained about not being paid, instituted a proceeding, or testified or is about to testify — and an employer who wilfully fails to comply with any other requirement of the chapter — shall be fined not less than $100 nor more than $10,000 or imprisoned for not more than one year, or punished by both fine and imprisonment, for each such offense.

How the Claim Is Brought — and the Deadline

HRS §388-11(a) provides that an action by an employee to recover unpaid wages may be maintained in any court of competent jurisdiction by any one or more employees on their own behalf, or through a designated agent or representative.

HRS §388-11(c) provides that the court in any such action shall, in addition to any judgment awarded to the plaintiff, allow interest of six per cent per year from the date the wages were due, costs of action including costs of fees of any nature, and reasonable attorney’s fees, to be paid by the defendant.

There is also an administrative route. HRS §388-11(b) allows the director of labor and industrial relations, on the employee’s request, to take an assignment of the claim in trust and bring legal action to collect it — and provides that no claim shall be accepted by the director after the expiration of one year from the date the wages are due and payable.

That one-year figure is the limit on the director accepting an assigned claim. The statute does not state it as the deadline for an employee’s own court action, and this page does not publish a deadline for a court action. The limitations period depends on how the claim is pleaded, and a wage claim may also carry separate federal deadlines. Wage deadlines are short and unforgiving. Confirm the one that applies to you with an attorney immediately rather than estimating it from anything written here.

Frequently Asked Questions

Related Pages

If you were fired or disciplined after raising a pay issue, the anti-retaliation provision in §388-10(b)(2) sits alongside the protections described on the page about retaliation and wrongful termination. If the pay difference tracks a protected characteristic, see employment discrimination under HRS chapter 378.

If You Are Owed Money

Wage claims tend to be documentary. Pay stubs, schedules, timekeeping records, the handbook, and any written authorization for a deduction are usually what decides them, and they are easier to gather while the employment is fresh than later.

If you would like to know whether HRS chapter 388 covers what happened to you, and what deadline applies, you can speak with my Honolulu office and ask.