BILL ANALYSIS C.S.H.B. 1009 By: Johnson/Junell/Hunter, T. 4-28-95 Committee Report (Substituted) BACKGROUND The purpose of Worker's Compensation is to give temporary aid to those who are injured on the job. Unfortunately, some individuals are abusing this privilege. If a company chooses to terminate an employee with a workers compensation claim in their background, the employee only has to prove that the employer's motivation for termination was remotely linked to the worker's historical compensation claim and not the actual cause. This nexus creates a dilemma for the business community; either pay out a large settlement to end the expense or keep the employee on as a non-productive worker to curb the cost of a legal fight. PURPOSE To prevent employers and employees from abusing the worker's compensation discrimination clause. RULEMAKING AUTHORITY It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency or institution. SECTION BY SECTION ANALYSIS SECTION 1. Amends Section 451.001, Labor Code. A person may not discharge or discriminate against an employee because the employee: (1) filed a worker's compensation claim in good faith; (2) hired a lawyer to represent the employee in a claim; (3) instituted or caused to be instituted in good faith a proceeding under Subtitle A; or (4) testified or is about to testify in a proceeding under Subtitle A. SECTION 2. Section 451.002, Labor Code is amended by amending Subsections (A) and (C) and by adding (D), (E), (F), (G). (A) Establishes that a person who violates Section 451.001 is liable for reasonable damages incurred by the employee as a result of the violation to include: (1) amount equal loss of wages, commissions and bonuses; (2) compensation for any employer-provided benefits, (3) loss or damage of property, credit, and earning capacity, (4) emotional pain, suffering, inconvenience, mental anguish. However, the award under this subsection may not exceed: (a) an employer with fewer than 101 employees, $50,000; (b) an employer with more than 100 but less than 201 employees, $100,000; (c) an employer with more than 200 but less than 501 employees, $200,000; (d) an employer with more than 500 employees, $300,000, and (5) specifies that punitive damages may be recovered if the complainant demonstrates that the respondent engaged in discriminatory practice with malice or with reckless indifference. Punitive damages will be limited to four times the total of the other damages awarded under this Section. (B) States that an employee is entitled to re-instatement when an employee is discharged in violation of Section 451.000. (C) Specifies that the burden is on the employee to establish an action of the employee protected under section 451.000 was a motivating factor of employee's discharge. (D) Provides that the court may allow prevailing employee court costs including reasonable attorney fees. (E) Provides that the court may allow a prevailing employer, reasonable attorney fees if the claim was frivolous. (F) States that all state, county, municipal, and other governmental or political subdivisions are liable for costs. (G) The court may include reasonable expert fees. Establishes the effective date as September 1, 1995. This Act applies only to a cause of action that accrues on or after the effective date of this Act. Establishes an emergency clause. COMPARISON OF ORIGINAL TO SUBSTITUTE The major points of difference between H.B. 1009, as introduced and the committee substitute are as follows: The substitute is not a Legislative Council draft. Under Section 451.002, the substitute establishes reasonable damages in 5 categories to include amount equal to any loss and compensation for the loss by the employee of any benefits, or reasonable damages that includes property loss, credit damage, damage to earning capacity. Also, reasonable damages that include emotional pain, suffering, mental anguish. Under the former damages specified, certain caps are defined for compensatory damages based on a employee ratio. Also included in this section, a complainant may recover punitive damages against a respondent, if the complainant demonstrates the respondent engaged in discriminatory practice with malice or with reckless indifference. The burden of proof is on the employee to prove Section 451.000 as the motivating factor, which is found under Section 451.002(C). The substitute establishes that the courts may impose court costs as stated under Section 451.002 (D), (E), (F), and (G). SUMMARY OF COMMITTEE ACTION H.B. 1009 was considered by the Committee on Business and Industry in a public hearing on April 25, 1995. Testifying in support of the bill were J. Ken Johnson, representing himself; Lauren Don Luttrell, representing himself; Ted B. Roberts, representing Texas Association of Business and Chambers of Commerce; Christopher A. Knepp, representing Texas Employment Law Council; Randall H. Erben, representing National Federation of Independent Business-Texas. Testifying against H.B. 1009 were Rick Levy, representing Texas AFL-CIO; Jack C. Vowell, representing Greater El Paso Chamber of Commerce; Rick Freeman, representing Texas Trial Lawyers Association; Jason M. Willett, representing himself; Clay Jenkins, representing himself; Jeff Meyerson, representing Meyerson and Hoffman, L.L.P.. No one testified on the bill. The committee considered a complete committee substitute to the bill. The substitute was withdrawn. H.B. 1009 was left pending before the committee. H.B. 1009 was considered by the committee on pending business in a formal meeting on April 28, 1995. The committee considered a complete committee substitute to the bill. The committee substitute was adopted without objection. H.B. 1009 was reported favorably, as substituted with the recommendation that it do pass and be printed by a record vote of 7 (seven) ayes, 1 (one) nay, 1 (one) present-not-voting, 0 (zero) absent.