Fact Sheet - Call Centers (Report No. 3, 2003)


I. Highlights

A. House Concurrent Resolution No. 128, H.D. 1, adopted by the Legislature in the 2003 Regular Session, requested the Bureau to "review pending customer rights practices and draft legislation mandating that call centers must accurately disclose their location to any customer who inquires."

B. Findings. The Bureau finds that:

  1. No statutes from Hawaii, the other states, or the federal government expressly or specifically address "pending customer rights practices" with regard to a call center's duty to disclose its location to customers.
  2. A 2003 bill introduced into the New Jersey legislature addresses the specific issue of call center disclosure. To date, the New Jersey legislature has not adopted the legislation.
  3. The problem that proponents claim needs to be corrected by the requested proposed legislation involves foreign call centers that serve American customers and whose employees reportedly hold themselves out to American customers as being American.
  4. Several rationales are given by proponents for the need for disclosure legislation. The key reason appears to be job protection. Other reasons given are the protection of national security, the protection of consumer privacy, and the promotion of customer satisfaction.
  5. There is no indication in local media and business reports that call center jobs in Hawaii are being outsourced or are at risk of being outsourced to foreign countries.
  6. Under the existing law on deceptive trade practices, a call center's failure to disclose its location does not seem to create the kind of likelihood of confusion that the laws were intended to prevent.

C. Recommendations

  1. There are no recommendations.

II. Frequently Asked Questions

  1. What are call centers? Answer: Under the Hawaii Revised Statutes, a "call center" is defined under certain tax and economic development laws as a business or operation that provides customer support by telephone for certain types of companies and services, but does not engage in telemarketing or sales. The companies and services served by the call centers include but are not limited to manufacturing companies and computer hardware and software companies.
  2. If there is no recommendation, why is proposed legislation included in this report? Answer: It is the proposed legislation that was requested under H.C.R. No. 128, H.D. 1. It is presented without any endorsement, approval, or recommendation by the Bureau. It is offered only because the Bureau was directed by the resolution to "draft legislation mandating that call centers must accurately disclose their location to any customer who inquires."

    The proposed legislation applies to a call center that is owned and operated by a corporation or other business entity whose principal place of business is in the State. It requires the employees of the call center to disclose their location to Hawaii customers. No geographic limitations are placed on the location of the call center.