BILL ANALYSIS
H.B. 1028
By: Oliveira
February 28, 1995
Committee Report (Amended)
BACKGROUND
The 73rd Legislature passed Senate Bill 939, which provides for
administrative penalty procedures and criminal penalties in
relation to the employment of children (Child Labor Laws). S.B. 939
passed as a Session Law prior to the codification of the Labor
Code, and, consequently, the provisions of the bill are not part of
the Labor Code, which makes it difficult for employers to find the
statutes.
The provisions for administrative hearings, notices, penalties,
appeals, and collection are similar, but not identical, to the laws
for payment of wages (Payday Law), further confusing the business
community. Additionally, one department of the Texas Employment
Commission (TEC) administers both the Payday and Child Labor
statutes, and those statutes apply to many of the same employers.
In enforcing the Child Labor Laws, TEC has encountered cases where
an employer has previously employed children but fires the child as
soon as TEC begins to investigate the employer. The statute
addresses only current employment and some employers attempt to
avoid TEC scrutiny by claiming once the child is fired the employer
can not be charged under the statute. The law should specifically
address both past and current violations.
PURPOSE
These amendments would codify and change the Child Labor provisions
in the Labor Code to make the procedures for enforcement the same
as those found in the Payday Law; provide collection remedies for
unpaid penalties; and specifically provide that the TEC may
investigate past as well as current instances of child labor
violations.
RULEMAKING AUTHORITY
It is the committee's opinion that this bill does not grant any
additional rulemaking authority to a state officer, department,
agency, or institution.
SECTION BY SECTION ANALYSIS
SECTION 1. Amends Section 51.021(a) of the Labor Code to specify
that the TEC may investigate past violations of the Child Labor
Laws as well as existing violations.
SECTION 2. Adds new provisions to the Labor Code for
administrative processes in determining child labor cases by the
TEC similar to those administrative processes already provided for
Payday Laws. The provisions provide for the power of the TEC to
investigate child labor violations by administering oaths, taking
depositions and issuing subpoenas and the penalties for failure to
comply with these provisions.
SECTION 3. Incorporates the 1993 law into the Labor Code and
changes the time period for requesting a hearing from 20 days to 21
days to provide identical time periods for both the Child Labor and
the Payday statutes. Adds Section 51.033, ADMINISTRATIVE PENALTIES,
as follows:
(a) Authorizes the commission, if it determines that a person
who employs a child has violated this Act, to assess an
administrative penalty against that person.
(b) Authorizes the penalty for a violation to be in an amount
not to exceed $10,000.
(c) Sets forth items on which the amount of the penalty is to
be based.
(d) Requires the commission, if the commission determines that
a violation has occurred, to issue a preliminary determination
that states the facts on which the determination is based, the
fact that an administrative penalty is to be imposed, and the
amount of the penalty.
(e) Requires the commission, within a specific time frame, to
give written notice of the preliminary determination to the
person charged. Requires the notice to include a brief summary
of the alleged violation and a statement of the amount of the
penalty. Requires the notice to inform the person that the
person has a right to a hearing on the occurrence of the
violation, the amount of the penalty, or both.
(f) Authorizes the person, within a specific time frame, to
make a written request for a hearing on the occurrence of the
violation, the amount of the penalty, or both. Also changes
the specific time frame from 20 days to 21 days, to conform
with the time frame in the Payday Law.
(g) Requires the commission, if the person requests a hearing,
to set a hearing and give notice of the hearing to the person
not later than the 21st day after the hearing request is
received. The hearing shall be held "[a]s soon as
practicable," but not later than 45 days after the date the
hearing notice is mailed. Subjects the hearing to the
commission rules and procedures used by the commission to
determine a claim under Subtitle A, Title 4, but not subject
to Chapter 2001, Government Code. Requires the hearing
examiner to issue a decision.
S.B. 939 did not specify a time frame, and made hearings
subject to the rules and procedures used by the commission to
determine a claim under the Texas Unemployment Compensation
Act.
(h) Requires the commission, if it is determined that a
penalty may be imposed, to enter a written order to that
effect. Requires the commission to notify the person in
writing of the decision and the amount of the penalty imposed
by mailing the notice to the person's last known address in
commission records. The order becomes final 14 days after
mailing unless reopened by the commission or the person files
a written motion for rehearing.
(i) Requires the notice of the commission's order to include
a statement of the right of the person to judicial review of
the order.
(j) Requires the person, within a specific time frame, to pay
the amount of the penalty, pay the amount of the penalty and
file a petition for judicial review, or without paying the
penalty, file a petition for judicial review.
(k) Authorizes a person who acts under Subsection (j)(3),
within a specific time frame, to stay enforcement of the
penalty by certain means or to request the court to stay the
enforcement of the penalty by other specific means.
(l) Authorizes the commission, if the commission receives a
copy of the affidavit under Subsection (k)(2), to file with
the court, within a specific time frame, a contest to the
affidavit. Requires the court to hold a hearing on the facts
alleged in the case and to stay the enforcement of the penalty
on finding that the alleged facts are true. Places the burden
of proof on the person who files the affidavit to prove that
the person is financially unable to pay the amount of the
penalty and to give a supersedeas bond.
(m) Authorizes the commission to refer the matter to the
attorney general for collection of the amount of the penalty
if the person does not pay the amount of the penalty and the
enforcement of the penalty is not stayed.
(n) Provides that judicial review of the order of the
commission is instituted by bringing an action as provided by
Subchapter E, Chapter 212, Labor Code, and is under the
substantial evidence rule. S.B. 939 provides for judicial
review as provided by Section 6, Texas Unemployment
Compensation Act.
(o) Authorizes the court, if the court sustains the occurrence
of the violation, to uphold or reduce the amount of the
penalty and order the person to pay the full or reduced amount
of the penalty. Requires the court, if the court does not
sustain the occurrence of the violation, to order that no
penalty is owed.
(p) Requires the court to proceed under this subsection when
the judgement of the court becomes final. Requires the court,
if the person paid the amount and the amount is reduced or is
not upheld by the court, to order that the appropriate amount
plus interest to be remitted to the person. Provides that the
rate of interest is the rate charged on loans to depository
institutions by the New York Federal Reserve Bank, and
requires the interest to be paid for the period the commission
held the amount of the penalty. Requires the court to order a
release of a supersedeas bond if the person gave such a bond.
Requires the court, if the person gave a supersedeas bond and
if the amount of the penalty is reduced, to order the release
of the bond after the person pays the amount.
(q) Authorizes the attorney general to bring a suit in a
district court in Travis County to enforce a final order from
which an appeal under this Act has not been taken. Authorizes
the court, in the suit and on the request of the attorney
general, to order payment of attorney's fees.
(r) Requires a penalty collected under this section to be
remitted to the comptroller for deposit in the general revenue
fund.
SECTION 4. Provides for the collection of penalties assessed
against an employer for violation of the Child Labor Laws. These
are the same collection provisions TEC currently has for enforcing
delinquent accounts for unemployment taxes and unpaid wages. These
allow for collection of penalty, notice to the employer, duties of
notice recipient, freezing of accounts or assets of the delinquent
employer, levy against accounts or assets, and discharge of
liability.
SECTION 5. Effective date September 1, 1995.
SECTION 6. Emergency clause.
EXPLANATION OF AMENDMENTS
AMENDMENT NO. 1. (1) Allows the TEC to inspect a place that a
child is employed or has been employed in the last two years.
(2) Allows the TEC to collect information
concerning a place that employs a child or that has employed a
child within the last two years.
AMENDMENT NO. 2. Gives TEC within 100 miles of the relevant event
to subpoena a witness.
SUMMARY OF COMMITTEE ACTION
H.B. 1028 was considered by the committee in a public hearing on
February 20, 1995. Testifying on the bill was Ed Davis,
representing the Texas Employment Commission, and Ted Roberts,
representing the Texas Association of Business and Chambers of
Commerce. Testifying in favor of the bill was Walter Hinojosa,
representing the Texas AFL-CIO. No one testified against the bill.
H.B. 1028 was left pending in committee for further consideration.
H.B. 1028 was reconsidered by the committee in a public hearing on
February 27, 1995. The committee considered amendments to the
bill. Two of those amendments were adopted without objection.
Testifying on the bill was Ed Davis, representing the Texas
Employment Commission. Testifying in favor of the bill was Ted
Roberts, representing the Texas Association of Business and
Chambers of Commerce. H.B. 1028 was reported favorably as amended
with the recommendation that it do pass and be printed, by a record
vote of 6 Ayes, 0 Nays, 0 PNV, 3 Absent.