Under the Hawaii Temporary Disability Insurance Law (TDI) Law, virtually all Hawaii employers are required to furnish disability insurance that provides employees with replacement income when they are disabled by non-job-related accidents or illnesses (HI Stat. Sec. 392-1 et seq.). (Workers' compensation covers job-related injuries.)
An employer may adopt one or more of the following methods of providing temporary disability insurance benefits:
• By purchasing insurance, called an “insured” plan, from an authorized insurance carrier;
• By adopting a sick leave policy, called a “self-insured” plan, which must be approved by Hawaii’s Disability Compensation Division (DCD) (A self-insured employer pays benefits directly to its disabled employees, and as a self-insurer, the employer must show proof of financial solvency and ability to pay benefits.); and/or
• By a collective bargaining agreement that contains sick leave benefits at least as favorable as required by the TDI Law (HI Stat. Sec. 392-41).