By Longoria H.B. No. 403
74R2710 PB-D
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to an employment security program for certain persons who
1-3 sustain an injury in the course and scope of their employment.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Title 5, Labor Code, is amended by adding
1-6 Subtitle D to read as follows:
1-7 SUBTITLE D. ALTERNATIVE COMPENSATION PROGRAMS
1-8 CHAPTER 551. EMPLOYMENT SECURITY PROGRAM
1-9 Sec. 551.001. DEFINITIONS. (a) In this chapter:
1-10 (1) "Employment security program" means an alternative
1-11 system created by an employer and an employee by contract, under
1-12 which the employee, in lieu of receipt of certain income benefits
1-13 to which the employee would otherwise be entitled, receives
1-14 vocational rehabilitation, retraining, and guaranteed employment in
1-15 a position equivalent in compensation and responsibility to that
1-16 held by the employee before a work-related injury.
1-17 (2) "Program" means an employment security program.
1-18 (b) The definitions adopted under Subchapter B, Chapter 401,
1-19 apply to this chapter.
1-20 Sec. 551.002. ALTERNATIVE SYSTEM; RULES. (a)
1-21 Notwithstanding any other provision of this title, an employer who
1-22 maintains workers' compensation insurance coverage through a policy
1-23 written by an insurance company and an employee who has reached
1-24 maximum medical improvement may establish by mutual contract an
2-1 employment security program as provided by this chapter.
2-2 (b) The commission shall adopt rules and standards as
2-3 necessary to implement this chapter.
2-4 Sec. 551.003. CONTRACT. (a) An employer and employee who
2-5 elect to establish an employment security program under this
2-6 chapter shall enter into a written contract regarding the terms of
2-7 the program.
2-8 (b) The commission by rule shall adopt a standard form for a
2-9 contract entered under this section.
2-10 (c) A program created under this chapter must be designed to
2-11 provide any vocational rehabilitation and retraining to the
2-12 employee injured in the course and scope of the employment with the
2-13 contracting employer that is necessary to enable the employee to
2-14 return to work with the employer. The contract must specify the
2-15 rehabilitation and retraining options to be offered to the affected
2-16 employee.
2-17 (d) The employer shall file a copy of the contract with the
2-18 commission not later than the 10th day after the date on which the
2-19 contract is signed by both parties.
2-20 Sec. 551.004. TRUST ACCOUNT; FUNDING. (a) An employee who
2-21 elects to participate in an employment security program shall file
2-22 a written statement of the election in the form prescribed by the
2-23 commission not later than the 30th day before the date on which the
2-24 employee is scheduled to return to work.
2-25 (b) An employee who elects to participate in an employment
2-26 security program under this chapter is not entitled to receive
2-27 impairment income benefits or supplemental income benefits under
3-1 Subtitle A and is entitled to receive lifetime income benefits only
3-2 as provided by Section 551.005(c). The commission shall determine
3-3 the amount of income benefits to which the employee would otherwise
3-4 be entitled under Subtitle A and shall notify the employee, the
3-5 employer, and the employer's insurance company of the amount. The
3-6 commission shall deliver the notification not later than the 15th
3-7 day after the date on which the commission receives the employee
3-8 statement under Subsection (a).
3-9 (c) On receipt of notification by the commission under
3-10 Subsection (b), the insurance company shall deposit an amount equal
3-11 to the amount determined by the commission under Subsection (b) in
3-12 a trust account, to be used only by the employer to pay expenses
3-13 authorized under Subsection (d). An insurance company that
3-14 deposits money in a trust account under this section is not liable
3-15 to pay benefits to the affected employee under the terms of the
3-16 employer's workers' compensation insurance policy and Subtitle A
3-17 except as provided by Section 551.005(c). Any balance remaining in
3-18 the trust account on the 10th anniversary of the date on which the
3-19 trust account was created shall be returned to the insurance
3-20 company and becomes the property of the insurance company.
3-21 (d) The employer may pay the costs associated with the
3-22 rehabilitation and retraining of the employee from the trust
3-23 account in the manner provided by commission rules.
3-24 Sec. 551.005. GUARANTY OF EMPLOYMENT. (a) A program
3-25 established under this chapter must provide for continuous
3-26 employment of the employee with the contracting employer until the
3-27 earlier of:
4-1 (1) the 10th anniversary of the date on which the
4-2 employee returns to work; or
4-3 (2) the date on which the employee's entitlement to
4-4 retirement benefits provided through the employer is vested.
4-5 (b) An employee who elects to participate in an employment
4-6 security program under this chapter may not be discharged by that
4-7 employer during the 10-year period except for cause. An employer
4-8 who discharges an employee in violation of this subsection is
4-9 liable for any loss of wages and employer-provided benefits
4-10 incurred by the employee as a result of the violation. A person
4-11 discharged in violation of this subsection is entitled to
4-12 reinstatement in the same or an equivalent position of employment
4-13 with commensurate pay.
4-14 (c) If the contracting employer ceases to be an employer
4-15 before the 10th anniversary of the date on which the employee
4-16 returns to work, the affected employee may apply to the commission
4-17 for a determination as to the amount of any lifetime income
4-18 benefits or other benefits for which the employee is eligible. If
4-19 the commission determines that the employee is eligible for
4-20 benefits, the employee shall elect either to receive the remaining
4-21 benefits in the manner provided by Section 408.161 or to commute
4-22 the remainder of the benefits.
4-23 Sec. 551.006. PREMIUM DISCOUNT. An employer who establishes
4-24 an employment security program under this chapter is entitled to a
4-25 discount on the amount of the employer's workers' compensation
4-26 insurance premium in the manner provided by Article 5.55A,
4-27 Insurance Code.
5-1 SECTION 2. Subchapter D, Chapter 5, Insurance Code, is
5-2 amended by adding Article 5.55A to read as follows:
5-3 Art. 5.55A. PREMIUM DISCOUNT FOR EMPLOYERS WHO ESTABLISH
5-4 CERTAIN EMPLOYMENT SECURITY PROGRAMS. (a) In this article,
5-5 "insurer" means a stock company, mutual company, reciprocal,
5-6 interinsurance exchange, Lloyd's association, or other entity
5-7 authorized to write workers' compensation insurance in this state.
5-8 The term includes the Texas workers' compensation insurance
5-9 facility and the Texas workers' compensation insurance fund.
5-10 (b) This article applies to an employer who establishes an
5-11 employment security program under Chapter 551, Labor Code.
5-12 (c) The board by rule shall adopt a plan under which each
5-13 insurer shall grant a discount to an employer subject to Subsection
5-14 (b) of this article who obtains workers' compensation insurance
5-15 coverage from that insurer and applies for the discount in the
5-16 manner prescribed by the board. The insurer shall grant a discount
5-17 of 10 percent on the amount of the employer's workers' compensation
5-18 premium.
5-19 (d) A discount established under this article is valid for
5-20 the term of the policy or contract of insurance. On renewal of the
5-21 policy, the employer must reapply for the discount in the manner
5-22 prescribed by the board.
5-23 (e) A discount under this article is in addition to any
5-24 other premium discount to which the employer is eligible under this
5-25 code.
5-26 SECTION 3. This Act takes effect September 1, 1995, and
5-27 applies only to a workers' compensation insurance policy that is
6-1 delivered, issued for delivery, or renewed on or after January 1,
6-2 1996. A policy that is delivered, issued for delivery, or renewed
6-3 before January 1, 1996, is governed by the law as it existed
6-4 immediately before the effective date of this Act, and that law is
6-5 continued in effect for that purpose.
6-6 SECTION 4. The importance of this legislation and the
6-7 crowded condition of the calendars in both houses create an
6-8 emergency and an imperative public necessity that the
6-9 constitutional rule requiring bills to be read on three several
6-10 days in each house be suspended, and this rule is hereby suspended.