SRC-JFA S.B. 445 75(R)    BILL ANALYSIS


Senate Research CenterS.B. 445
By: Haywood
Economic Development
3-17-97
As Filed


DIGEST 

Currently, Workers' Compensation Insurance Coverage, codified in Chapter
406 of the Labor Code, does not provide the conditions under which certain
oil and gas well workers or service providers are independent contractors.
In the oil and gas production business, it is common for an operator of an
oil and natural gas well to hire an individual to perform certain services
on the well.  The hired individual is usually an independent contractor
who is in business as a sole proprietor and does not have any employees.
Under recent interpretations of the Labor Code, the operator is being
required to provide workers' compensation insurance coverage for the hired
individual.  The operator does not pay employment taxes or withhold FICA
or federal income taxes for that individual since that individual is not
the operator's employee.  This bill would set forth the conditions under
which such an individual is an independent contractor in regard to the
operator for purposes of workers' compensation insurance coverage.  
 
PURPOSE

As proposed, S.B. 445 sets forth the conditions under which a person who
performs work or provides a service for an oil or gas well operator is an
independent contractor for purposes of workers' compensation insurance
coverage.  

RULEMAKING AUTHORITY

This bill does not grant any additional rulemaking authority to a state
officer, institution, or agency. 

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Section 406.122, Labor Code, by adding Subsection (d),
to set forth the conditions under which a person who performs work or
provides a service for an oil or gas well operator is an independent
contractor for purposes of workers' compensation insurance coverage.  

SECTION 2. Effective date: September 1, 1997.

SECTION 3. Emergency clause.