An arbitration decision has determined public school employees in five bargaining units of the state’s largest union are entitled to back pay of up to 25% of their total salaries for as much as two years, according to the state’s largest union.

The Hawaii Government Employees Association said the decision covers up to 7,800 Department of Education employees, including school nurses, office employees, and classroom educational assistants.

“Those working in the DOE were some of the most exposed among public service employees, putting their own health – as well as that of their loved ones – at substantial risk to keep services running in Hawaii’s schools,” HGEA Executive Director Randy Perreira said Tuesday in a written statement.

Arbitrators considering the hazard pay issue have “thus far have been unanimous: our members faced severe hazards over the course of the pandemic to sustain government operations, and they deserve compensation,” Perreira said in the statement.

The decision will not apply to public school teachers because the Hawaii State Teachers Association does not have hazard pay provisions in its contract. DOE did not respond to a request for comment.

The award is expected to complicate the budget picture at the state and county levels, and Perreira said in an interview he expects DOE will need to ask the Legislature for extra funding to cover the cost of the award.

HGEA and other unions are in similar negotiations with the City and County of Honolulu and the Big Island.

House Speaker Scott Saiki said Tuesday he has not yet seen the arbitration decision, but “this was not really anticipated as we entered the legislative session, so now we’ll have to go back to the drawing board when it comes to approving a balanced budget.”

HGEA has language in its contracts calling for hazard pay of 15% or 25%, depending on the severity of the hazard. Perreira has said the Covid-19 pandemic is the first time that contract language has been applied to government employees statewide.

The union estimated the latest arbitration decision may require the state to pay up to $150 million in back hazard pay for the DOE workers, but Perreira said a more precise calculation will have to come from the DOE.

He said the $150 million estimate assumes all 7,800 of the employees covered by the award will get at least some back hazard pay.

State Budget Director Luis Salaveria also deferred to the DOE, saying he has not yet seen the decision and could not estimate the total cost.

State House Finance Committee Chairman Kyle Yamashita said in a written statement that Gov. Josh Green’s administration is “still working on this.”

“We’re still waiting for details that will give us a better understanding of how to proceed,” Yamashita wrote. But the impact on the budget will likely be substantial.

Republican House Minority Leader Lauren Matsumoto said the hazard pay issue will “cost the state and the city a lot of money, but it’s important that we honor the contracts that we put into place. I don’t know if there’s any way around that.”

The template for settlements and awards on hazard pay is generally expected to follow HGEA’s arbitration award on Maui in 2022.

That decision confirmed the pandemic qualified as a “hazard” under the HGEA contract and determined more than 1,300 employees were entitled to back pay for the first two years of the pandemic. Maui Count employees began receiving hazard compensation payouts at the end of 2022.

Another decision on Kauai also concluded HGEA members there had faced a hazard and therefore qualified for hazard pay by contract, but the union said a follow-up case will be necessary to determine exactly who qualifies for payments.

Arbitration proceedings or negotiations are also underway with Hawaii County and Honolulu, and the unions involved include HGEA, the United Public Workers union and the State of Hawaii Organization of Police Officers.

The DOE arbitration decision “is a clear signal to the state and counties that it’s time to get serious about how they will cover the hefty price tag of THP (temporary hazard pay) payouts,” Perreira said in the statement.

According to HGEA, the DOE arbitration decision covers the period from March 4, 2020, to March 25, 2022, when then-Gov. David Ige’s pandemic emergency proclamations were in effect.

The hazard pay will not apply to periods when employees are teleworking, on leave, or absent from the work sites. However, it does apply to some jobs that may not usually be considered to be public-facing.

Perreira said office assistants, clerks, secretaries and others continued to directly serve the community through food distribution programs that operated daily from the schools.

“That was where the most public contact took place, the food pickups,” he said. “It was an all-hands-on-deck thing.”