74(R) HB 1028 Senate Committee Report

BILL ANALYSIS

H.B. 1028
By: Oliveira (Sibley)
Economic Development
05-22-95
Senate Committee Report (Unamended)
BACKGROUND

The 73rd Legislature passed S.B. 939, which provides for
administrative penalty procedures and criminal penalties in
relation to the employment of children (Child Labor Laws). S.B. 939
passed 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.

Also, in enforcing the Child Labor Laws, the Texas Employment
Commission (TEC) has encountered cases in which 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 cannot be charged
under the statute.

PURPOSE

As proposed, H.B. 1028 provides for the enforcement of certain
regulations regarding the employment of children.

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not grant any
additional rulemaking authority to a state officer, institution, or
agency.

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Section 51.021(a), Labor Code, to authorize the
Texas Employment Commission (commission), or a person designated by
the commission, during working hours, to inspect a place where
there is reason to believe that a child is employed or has been
employed within the last two years; and to collect information
concerning the employment of a child who works or has worked within
the last two years at that place.

SECTION 2. Amends Chapter 51C, Labor Code, by adding Section
51.024, as follows:

Sec. 51.024. POWERS OF COMMISSION; PENALTY. (a) Authorizes the
commission to require reports, conduct investigations, and
take other action it considers necessary to implement this
chapter.

(b) Authorizes a member of the commission or an authorized
representative of the commission, in the discharge of the
duties imposed by this chapter, to administer oaths and
affirmations, take dispositions, certify official acts, and
issue subpoenas to compel the attendance of witnesses who
may be found within 100 miles of the relevant event and the
production of books, papers, correspondence, memoranda, or
other records considered necessary as evidence in the
administration of this chapter. Requires the commission,
notwithstanding Chapter 152 or 154, Local Government Code,
or any other state law, to pay the fee of a sheriff or
constable for serving a subpoena under this subsection from
the administrative funds of the commission, and the
comptroller shall issue a warrant for that fee as directed
by the commission.

(c) Provides that in the case of contumacy or other refusal
to obey a subpoena issued by a member of the commission or
a representative of the commission, a county court or
district court within the jurisdiction of which the inquiry
is conducted or the person guilty of contumacy or refusal to
obey is found, resides, or transacts business has
jurisdiction on application by the commission or its
representative to issue to the person an order requiring the
person to appear before a commissioner, the commission, or
a representative of the commission to produce evidence or
give testimony regarding the matter under investigation.
Authorizes failure to obey the court order to be punished by
the court as contempt.

(d) Provides that a person commits an offense if the person,
without just cause, fails or refuses to obey a commission
subpoena to attend and testify; answer any lawful inquiry;
or produce books, papers, correspondence, memoranda, or
other records.

(e) Provides that an offense under Subsection (d) is
punishable by a fine of not less than $200, confinement for
not more than 60 days, or by both fine and confinement.
Provides that each day of violation constitutes a separate
offense.

SECTION 3. Amends Chapter 51D, Labor Code, by adding Section
51.033, as follows:

Sec. 51.033. ADMINISTRATIVE PENALTY. (a) Authorizes the
commission, if the commission determines that a person who
employs a child has violated this chapter or a rule adopted
under this chapter, to assess an administrative penalty
against that person as provided by this section.

(b) Authorizes the penalty for a violation to be in an
amount not to exceed $10,000.

(d) Requires the commission, if after examination of a
possible violation and the facts relating to that possible
violation, 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, no later than 14 days after the
date the report is issued, to give written notice of the
preliminary determination to the person charged with the
violation. Requires the notice to include a brief summary of
the alleged violation and a statement of the amount of the
recommended penalty and 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 the occurrence of the
violation and the amount of the penalty.

(f) Authorizes the person, no later than 21 days after the
notice is mailed, to make a written request for a hearing on
the occurrence of the violation, the amount of the penalty,
or both the occurrence of the violation and the amount of
the penalty.

(g) Requires the commission, if the person requests a
hearing, to set a hearing and give notice of the hearing to
the person no later than 21 days after a request for the
hearing is received by the commission. Requires the
commission, no later than 45 days after the hearing notice
is mailed, to conduct the hearing. Provides that the hearing
is subject to the commission rules and hearing procedures
used by the commission to determine a claim under Title 4A,
but is not subject to Chapter 2001, Government Code.
Requires the hearings examiner to issue a decision.

(h) Requires the commission, if it is determined after the
hearing 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 at the
person's last known address. Provides that the order of the
commission becomes final 14 days after the date of mailing,
unless, within 14 days after the date of the mailing, the
hearing is reopened by commission order 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 a person, no later than 30 days after the
commission's final order is mailed, to:

(1) pay the amount of the penalty;

(2) pay the amount of the penalty and file a petition for
judicial review contesting the occurrence of the
violation, the amount of the penalty, or both the
occurrence of the violation and the amount of the penalty;
or

(3) without paying the amount of the penalty, file a
petition for judicial review contesting the occurrence of
the violation, the amount of the penalty, or both the
occurrence of the violation and the amount of the penalty.
(k) Authorizes a person who acts under Subsection (j)(3),
within a 30-day period, to:

(1) stay enforcement of the penalty by:

(A) paying the amount of the penalty to the court for
placement in an escrow account; or

(B) giving to the court a supersedeas bond approved
by the court that is for the amount of the penalty
and that is effective until all judicial review of the commission's order is final; or

(2) request the court to stay enforcement of the penalty
by:

(A) filing with the court a sworn affidavit of the
person stating that the person is financially unable to
pay the amount of the penalty and is financially unable
to give the supersedeas bond; and

(B) giving a copy of the affidavit to the commission
by certified mail.
(l) Authorizes the commission, if the commission receives a
copy of an affidavit under Subsection (k)(2), to file with
the court no later than five days after the copy is received
a contest to the affidavit. Requires the court to hold a
hearing on the facts alleged in the affidavit as soon as
practicable and to stay the enforcement of the penalty on
finding that the alleged facts are true. Provides that the
person who files an affidavit has the burden of proving that
the person is financially unable to pay the amount of the
penalty and to give a supersedeas bond.

(m) Authorizes the commission, if the person does not pay
the amount of the penalty and the enforcement of the penalty
is not stayed, to refer the matter to the attorney general
for collection of the amount of the penalty.

(n) Provides that judicial review of the order of the
commission is instituted by bringing an action as provided
by Chapter 212E and is under the substantial evidence rule.

(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 a penalty is not owed.

(p) Requires the court, when the judgment of the court
becomes final, to proceed under this subsection. Requires
the court, if the person paid the amount of the penalty and
if that amount is reduced or is not upheld by the court, to
order that the appropriate amount plus accrued interest be
remitted to the person. Provides that the rate of the
interest is the rate charged on loans to depository
institutions by the New York Federal Reserve Bank, and the
interest shall be paid for the period beginning on the date
the penalty was paid and ending on the date the penalty is
remitted. Requires the court, if the person gave a
supersedeas bond and if the amount of the penalty is not
upheld by the court, to order the release of the 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 chapter 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 and
other costs of court.

(r) Requires a penalty collected under this section to be
remitted to the comptroller for deposit in the general
revenue fund.

SECTION 4. Amends Chapter 51, Labor Code, by adding Subchapter E,
as follows:

SUBCHAPTER E. COLLECTION OF PENALTY

Sec. 51.041. DEFINITION. Defines "asset."

Sec. 51.042. NOTICE OF DELINQUENCY. (a) Authorizes the
commission, if under final order, a person is determined to be
delinquent in the payment of any amount, including penalties,
interest, or other amounts due under this chapter, to notify
personally or by mail any other person who either possesses or
controls an asset belonging to the delinquent person; or owes
a debt to the delinquent person.

(b) Requires a notice under this section to a state officer,
department, or agency to be given before the officer,
department, or agency presents to the comptroller the claim
of the delinquent person.

(c) Authorizes a notice under this section to be given at
any time after the amount due under this chapter becomes
delinquent. Requires the notice to state the amount of
wages, penalties, interest, or other amount due, and any
additional amount that will accrue by operation of law in a
period not to exceed 30 days after the date on which the
notice is given and, in the case of credit, bank, or savings
account or deposit, is effective only up to that amount.

Sec. 51.043. DUTIES OF NOTICE RECIPIENT. (a) Provides that on
receipt of a notice under Section 51.042, the person receiving
the notice:

(1) shall advise the commission no later than 20 days
after the date on which the notice is received of each
asset belonging to the delinquent person that is possessed
or controlled by the person receiving the notice and of
each debt owed by the person receiving the notice to the
delinquent person; and

(2) unless the commission consents to an earlier
disposition, may not transfer or dispose of the asset or
debt possessed, controlled, or owed by the person
receiving the notice on the date the person received the
notice during the 60-day period after the date of receipt
of the notice.
(b) Provides that a notice under Section 51.042 that
attempts to prohibit the transfer or disposition of an asset
possessed or controlled by a bank is effective if it is
delivered or mailed to the principal or any branch office of
the bank, including the office of the bank at which the
deposit is carried or the credit or property is held.

(c) Provides that a person who receives a notice under this
subchapter and who transfers or disposes of an asset or debt
in a manner that violates Subsection (a)(2) is liable to the
commission for the amount of the indebtedness of the
delinquent person with respect to whose obligation the
notice was given, to the extent of the value of the affected
asset or debt.

Sec. 51.044. LEVY. (a) Authorizes the commission, at any time
during the 60-day period provided by Section 51.043(a)(2), to
levy on the asset or debt by delivery of notice of levy.

(b) Requires the person possessing the asset or debt, on
receipt of the levy notice, to transfer the assets to the
commission or pay to the commission the amount owed to the
delinquent person.

Sec. 51.045. NOTICE EFFECT. Provides that a notice delivered
under this subchapter is effective:

(1) at the time of delivery against all property, rights to
property, credits, and debts involving the delinquent person
that are not, as of the date of the notice, subject to a
preexisting lien, attachment, garnishment, or execution
issued through a judicial process; and

(2) against all property, rights to property, credits, or
debts involving the delinquent person that come into the
possession or control of the person served with the notice
during the 60-day period provided by Section 51.043(a)(2).
Sec. 51.046. DISCHARGE OF LIABILITY. Provides that a person
acting in accordance with the terms of a notice issued by the
commission under this subchapter is discharged from any
obligation or liability to the delinquent person with respect
to the affected property, rights to property, credits, and
debts of the person affected by compliance with the notice of
freeze or levy.
SECTION 5. Effective date: September 1, 1995.

SECTION 6. Emergency clause.