§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
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
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.
as limited by chapter 657, the employee may at any time commence an action or join in any
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
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
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
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
expenditure for compensation, less his share of such expenses and attorney's fee. On application
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
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
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
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
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
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
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
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
If the special compensation fund has paid or is liable for any
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
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]
Mailing of notice, see §1-28.
Rules of Court
Consolidation of actions, see HRCP rule 42.
Intervention, see HRCP rule 24.
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,
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
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
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.
(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]
(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
§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,
Section preempted by ERISA to the extent it prohibits offsetting workers'
compensation payments intended to provide income replacement against pension benefits. 679 F
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
the State. The employer shall file with the director, in the form prescribed by the director, a
of insurance as required by section 386-122. [L 1986,
c 132, §1; am L 1989, c 24, §1]