Hawaii enacts trust fund law to protect child performers' earnings

The Hawaii House of Representatives introduced House Bill 874 on February 28, 2025, aimed at safeguarding child performers in the entertainment industry. This legislation seeks to establish mandatory trust accounts for minors engaged in theatrical employment, ensuring that a portion of their earnings is preserved until they reach adulthood.

The bill draws inspiration from the Coogan Act, which was enacted in California in 1939 to protect child actors from financial exploitation. House Bill 874 mandates that parents or legal guardians of child performers set up trust accounts prior to their first employment, with employers required to deposit at least 15% of the minor's gross earnings into these accounts. The trust accounts must be managed by an independent third-party trustee, who will provide quarterly statements to the child and their guardians.

Key provisions of the bill include strict fiduciary duties for parents and guardians, with penalties for any misappropriation of funds. The legislation applies to minors earning at least $5,000 for a project or $20,000 in a calendar year, covering a wide range of theatrical employment, including modeling, acting, and social media influencing.

Debate surrounding the bill has highlighted concerns about the potential burden on small production companies and the feasibility of compliance with the trust account requirements. However, proponents argue that the protections are essential for the financial security and well-being of child performers, who are often vulnerable to exploitation.

The implications of House Bill 874 extend beyond financial security; it aims to promote ethical practices within the entertainment industry and ensure that child performers can enjoy the fruits of their labor as adults. As the bill progresses through the legislative process, its potential impact on Hawaii's entertainment landscape and the protection of child performers remains a focal point of discussion among lawmakers and industry stakeholders.

The bill is set to take effect on July 1, 3000, pending further legislative approval and discussions.