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Hawaii Businesses Face Increased Potential for Employee Absences Under Expanded Family Leave Law

·4 min read·👀 Watch

Executive Summary

Hawaii's Family Leave Law has been expanded to include leave for qualifying military exigencies, effective July 1. This change increases the potential for intermittent employee absences, requiring businesses to update HR policies and consider workforce planning adjustments. Small business operators and tourism providers should review their staffing models.

  • Small Business Operators: Increased potential for unplanned or intermittent staff absences.
  • Tourism Operators: Staffing continuity may be impacted during peak periods.
  • Healthcare Providers: Potential for staffing gaps requiring adjustments to patient schedules.
  • Entrepreneurs & Startups: Workforce planning needs to account for extended leave provisions.
  • Action: Review and update employee handbooks and leave policies before July 1.

Watch & Prepare

Medium PriorityJuly 1

Businesses need to update their HR policies and consider potential staffing adjustments before the law takes effect on July 1st.

Review and update employee handbooks and leave policies to reflect expanded military exigency leave provisions before July 1, 2026. Ensure HR and management are trained on the new requirements.

Who's Affected
Small Business OperatorsTourism OperatorsHealthcare ProvidersEntrepreneurs & Startups
Ripple Effects
  • →Increased potential for employee absences → need for cross-training and flexible staffing → potential rise in overtime or temporary staffing costs
  • →Greater demand on HR to track leave entitlements → increased administrative burden for businesses
  • →Need to adjust scheduling and workflow → potential impact on service delivery continuity in key sectors like tourism and healthcare
Aerial view of the scenic coastline and roadway in Waianae, Hawaii with lush mountains and turquoise ocean.
Photo by Jess Loiterton

Expanded Family Leave Law Takes Effect July 1

Governor Josh Green has signed Act 13 into law, significantly expanding the Hawaiʻi Family Leave Law. Effective July 1, 2026, eligible employees can now take family leave for qualifying military exigencies. This expansion allows for leave related to a son or daughter, spouse, reciprocal beneficiary, sibling, grandchild, or parent who is serving in the United States Armed Forces.

The updated law broadens the scope of circumstances under which employees can take protected leave, potentially leading to more frequent or extended employee absences. While intended to support military families, the practical implication for employers across the state is a need to prepare for greater workforce planning complexity.

Who's Affected

Small Business Operators

Small businesses, including restaurants, retail shops, and service providers, are particularly vulnerable to the impact of increased potential employee absences. Even intermittent leave can disrupt workflow, customer service, and operational continuity. Operators will need to assess their staffing levels and cross-training protocols to ensure adequate coverage when employees utilize this expanded leave.

Tourism Operators

Hotels, tour companies, and vacation rental businesses, often reliant on consistent staffing, particularly during peak seasons, will need to factor in potential employee leave. The possibility of employees taking leave for military exigencies adds another layer to an already complex scheduling environment, potentially impacting service delivery and guest experiences if not managed proactively.

Healthcare Providers

Clinics, private practices, and other healthcare facilities face challenges in maintaining patient care continuity. Increased potential for employee absences, even for short periods, can lead to appointment backlogs, strain on remaining staff, and the need for flexible scheduling solutions. This is particularly critical in an industry already grappling with staffing shortages.

Entrepreneurs & Startups

Startups and growth-stage companies, often operating with lean teams, must integrate these expanded leave provisions into their initial HR policies and future workforce planning. The ability to scale operations can be indirectly affected if key personnel are frequently unavailable due to expanded leave entitlements.

Second-Order Effects

The expansion of family leave, while beneficial for employees with military family members, can indirectly increase operational costs for some businesses. If businesses must hire temporary staff or pay overtime to cover extended absences, this can lead to higher labor expenses. This, in turn, could contribute to increased prices for goods and services, potentially affecting consumer spending and the overall cost of living in Hawaii. Furthermore, businesses may need to invest more resources in HR administration to track and manage these leave entitlements, diverting resources from other critical areas.

What to Do

Businesses should proactively update their employee handbooks and internal leave policies to reflect the changes brought by Act 13. This includes clearly defining eligibility criteria for military exigency leave and outlining the procedures for requesting and approving such leave. Management and HR personnel should receive training on the new provisions to ensure consistent and compliant application of the law. Reviewing staffing models to identify potential coverage gaps and developing contingency plans for intermittent absences is also advisable. While the law takes effect July 1, 2026, an immediate review of policies and cross-training initiatives is recommended to ensure preparedness.

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