Bill not drafted by TLC or Senate E&E.
Line and page numbers may not match official copy.
By Haggerty H.B. No. 1465
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the regulation of staff leasing services; providing
1-3 penalties.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Subchapter A, Chapter 91, Labor Code, is amended
1-6 to read as follows:
1-7 Sec. 91.001. Definitions. In this chapter:
1-8 (1) "Applicant" means a business [entity applying for
1-9 a license] seeking to be registered or seeking the renewal of a
1-10 [license] registration under this chapter.
1-11 (2) "Assigned employee" means a full-time employee
1-12 whose normal work week is at least 25 hours and whose work is
1-13 performed in this state. The term does not include an employee
1-14 hired to support or supplement a client company's work force in a
1-15 special work situation, including:
1-16 (A) an employee absence;
1-17 (B) a temporary skill shortage;
1-18 (C) a seasonal workload; or
1-19 (D) a special assignment or project.
1-20 (3) "Client company" means a person that contracts
1-21 with a [license holder] registrant and is assigned employees by the
1-22 [license holder] registrant under that contract.
1-23 (4) "Commission" means the [Texas Commission of
1-24 Licensing and Regulation].
2-1 (5) "Commissioner" means the commissioner of
2-2 [licensing and regulation].
2-3 (6) "Controlling person" means:
2-4 (A) an officer or director of a corporation that
2-5 offers or proposes to offer staff leasing services, a shareholder
2-6 holding 10 percent or more of the voting stock of a corporation
2-7 that offers or proposes to offer staff leasing services, or a
2-8 partner of a partnership that offers or proposes to offer staff
2-9 leasing services; or
2-10 (B) an individual who directly or indirectly has
2-11 the power to direct or cause the direction of the management or
2-12 policies of a company that offers or proposes to offer staff
2-13 leasing services through:
2-14 (i) the ownership of voting securities;
2-15 (ii) contract; or
2-16 (iii) another means.
2-17 (7) "Department" means the [Texas Department of
2-18 Licensing and Regulation].
2-19 (8) "Independent contractor" means a person who
2-20 contracts to perform work or provide a service for the benefit of
2-21 another and who:
2-22 (A) is paid by the job, not by the hour or some
2-23 other time-measured basis;
2-24 (B) is free to hire as many helpers as the
2-25 person desires and to determine what each helper will be paid; and
2-26 (C) is free to work for other contractors, or to
2-27 send helpers to work for other contractors, while under contract to
2-28 the hiring employer.
2-29 (9) ["License holder"] Registrant means a person
2-30 [licensed] registered under this chapter and holding a certificate
3-1 issued by _____ to provide staff leasing services.
3-2 [(10) "Public company" means a corporation whose
3-3 shares are listed on the New York Stock Exchange and that has total
3-4 assets that exceed $1 billion.]
3-5 (10) Certificate if Registration means a certificate
3-6 issued by ____ pursuant to registration under this Act.
3-7 (11) "Staff leasing services" means an arrangement by
3-8 which employees of a [license holder] registrant are assigned to
3-9 work at a client company and in which employment responsibilities
3-10 are [in fact shared by the license holder] defined between the
3-11 employee leasing company and the client company, the employee's
3-12 assignment is intended to be of a long-term or continuing nature,
3-13 rather than temporary or seasonal in nature, and a majority of the
3-14 work force at a client company worksite or a specialized group
3-15 within that work force consists of assigned employees of the
3-16 [license holder] registrant. The term does not include:
3-17 (A) a temporary help service;
3-18 (B) an independent contractor;
3-19 (C) a public company or any other person in
3-20 which that public company has a direct or indirect ownership
3-21 interest in excess of 33 1/3 percent, including ownership through
3-22 subsidiaries and affiliates; or
3-23 (D) a temporary common worker employer as
3-24 defined by Chapter 92.
3-25 (12) "Staff leasing services company" means a business
3-26 entity that offers staff leasing services.
3-27 (13) "Temporary employee" means an employee hired for
3-28 a temporary help service.
3-29 (14) "Temporary help service" means an arrangement by
3-30 which an organization hires its own employees and assigns them to a
4-1 client to support or supplement the client's work force in a
4-2 special work situation, including:
4-3 (A) an employee absence;
4-4 (B) a temporary skill shortage;
4-5 (C) a seasonal workload; or
4-6 (D) a special assignment or project.
4-7 (15) "Person" means an individual, association,
4-8 corporation, organization, government or governmental subdivision
4-9 or agency, business trust, estate trust, joint venture,
4-10 partnership, or other legal entity.
4-11 Sec. 91.002. Rules. (a) The commissioner shall adopt rules
4-12 as necessary to administer this chapter[, including rules for the
4-13 form and content of a license issued under this chapter and a
4-14 notice required under Section 91.045]. These rules shall be
4-15 adopted in compliance with Article 6252-13a, Vernon's Texas Civil
4-16 Statutes.
4-17 (b) Each [license holder] registrant is subject to this
4-18 chapter and the rules adopted by the commissioner.
4-19 (c) Notwithstanding any other provision of this chapter,
4-20 nothing in this [This] chapter [does not] preempts the existing
4-21 statutory or rulemaking authority of any other state agency or
4-22 entity to regulate staff leasing services in a manner consistent
4-23 with the statutory authority of that state agency or entity.
4-24 SECTION 2. Subchapter B, Chapter 91, Labor Code, is amended
4-25 to read as follows:
4-26 Sec. 91.011. [LICENSE] REGISTRATION REQUIRED. (a) A person
4-27 may not engage in or offer staff leasing services in this state
4-28 without [unless the person holds a license issued] registering
4-29 under this chapter.
4-30 Sec. 91.012. GENERAL [LICENSE] REGISTRATION REQUIREMENTS.
5-1 (a) To be qualified to serve as a controlling person of a [license
5-2 holder] registrant under this chapter, that person must be at least
5-3 18 years of age, be of good moral character, and have educational,
5-4 managerial, or business experience relevant to:
5-5 (1) operation of a business entity offering staff
5-6 leasing services; or
5-7 (2) service as a controlling person of a staff leasing
5-8 services company.
5-9 [(b) For purposes of this section, "good moral character"
5-10 means a personal history of honesty, trustworthiness, fairness, a
5-11 good reputation for fair dealing, and respect for the rights of
5-12 others and for the laws of this state and nation.]
5-13 [Sec. 91.013. BACKGROUND INVESTIGATIONS. (a) The
5-14 department shall conduct a thorough background investigation of
5-15 each individual applicant and of each controlling person of each
5-16 applicant to determine whether that applicant or controlling person
5-17 is qualified under this chapter. The department may deny an
5-18 application for the issuance or renewal of a license if the
5-19 department finds that a controlling person is not qualified under
5-20 this chapter. The investigation must include:]
5-21 [(1) the submission of fingerprints for processing
5-22 through appropriate local, state, and federal law enforcement
5-23 agencies; and]
5-24 [(2) examination by the department of police or other
5-25 law enforcement records maintained by local, state, or federal law
5-26 enforcement agencies.]
5-27 [(b) Department background investigations are governed by
5-28 this chapter, Section 411.122, Government Code, and Article
5-29 6252-13c, Revised Statutes, and by Sections 2 through 5, Chapter
5-30 267, Acts of the 67th Legislature, Regular Session, 1981 (Article
6-1 6252-13d, Vernon's Texas Civil Statutes). Conviction of a crime
6-2 does not automatically disqualify a controlling person, require the
6-3 revocation of a license, or require the denial of an application
6-4 for a new or renewed license. The department shall consider
6-5 criminal convictions as provided by Section 411.122, Government
6-6 Code, Article 6252-13c, Revised Statutes, and Sections 2 through 5,
6-7 Chapter 267, Acts of the 67th Legislature, Regular Session, 1981
6-8 (Article 6252-13d, Vernon's Texas Civil Statutes).]
6-9 [Sec. 91.014. NET WORTH REQUIREMENTS. (a) An applicant for
6-10 an original or renewal license must demonstrate a net worth as
6-11 follows:]
6-12 [(1) $50,000 if the applicant employs fewer than 250
6-13 assigned employees;]
6-14 [(2) $75,000 if the applicant employs at least 250 but
6-15 not more than 750 assigned employees; and]
6-16 [(3) $100,000 if the applicant employs more than 750
6-17 assigned employees.]
6-18 [(b) The applicant may demonstrate the applicant's net worth
6-19 to the department by providing the department with the applicant's
6-20 financial statement or a copy of the applicant's most recent
6-21 federal tax return. The applicant may also satisfy the net worth
6-22 requirement through guarantees, letters of credit, or other
6-23 security acceptable to the department. A guaranty is not
6-24 acceptable to satisfy this subsection unless the applicant submits
6-25 sufficient evidence to satisfy the department that the guarantor
6-26 has adequate resources to satisfy the obligations of the guaranty.]
6-27 [(c) In computing net worth, an applicant shall include
6-28 adequate reserves for all taxes and insurance, including reserves
6-29 for claims incurred but not paid and for claims incurred but not
6-30 reported under plans of self-insurance for health benefits. The
7-1 computation of net worth by an applicant is to be made according to
7-2 Section 448, Internal Revenue Code (26 U.S.C. Section 448).]
7-3 [(d) A document submitted to establish net worth must show
7-4 the net worth on a date not earlier than six months before the date
7-5 on which the application is submitted. A document submitted to
7-6 establish net worth must be prepared or certified by an independent
7-7 certified public accountant. Information supplied about net worth,
7-8 including copies of federal tax returns, is proprietary and
7-9 confidential and is exempt from disclosure to persons other than
7-10 other governmental agencies having a reasonable, legitimate purpose
7-11 for obtaining the information.]
7-12 Sec. 91.015. [LICENSE] REGISTRATION APPLICATION. (a) To
7-13 receive a staff leasing services company original or renewal
7-14 [license] Certificate of Registration, a person must file with the
7-15 department a written application accompanied by the application
7-16 fee.
7-17 [(b) The department may require an applicant for a license
7-18 to provide information and certifications necessary to determine
7-19 that the applicant meets the licensing requirements of this
7-20 chapter. The department may also require the applicant to provide
7-21 information and certifications necessary to determine whether
7-22 individuals affiliated with the applicant are qualified to serve as
7-23 controlling persons.]
7-24 [(c) An applicant or license holder is ineligible for a
7-25 license for two years after the date of a final department action
7-26 on the denial or revocation of a license applied for or issued
7-27 under this chapter. This restriction does not apply to a denial or
7-28 revocation of a license because of:]
7-29 [(1) an inadvertent error or omission in the
7-30 application if that error or omission is promptly corrected;]
8-1 [(2) insufficient experience documented to the
8-2 department at the time of the previous application; or]
8-3 [(3) the inability of the department to complete the
8-4 criminal background investigation required under Section 91.013
8-5 because of insufficient information received from a local, state,
8-6 or federal law enforcement agency.]
8-7 [(d) An applicant or license holder is ineligible for a
8-8 license for one year after the date of a final department action on
8-9 the denial or revocation of a license applied for or issued under
8-10 this chapter if the reason for the denial or revocation was that
8-11 one or more of the controlling persons affiliated with the
8-12 applicant or license holder was determined by the department to be
8-13 unsuitable and each unsuitable controlling person has in fact
8-14 ceased to be a controlling person of the applicant or license
8-15 holder.]
8-16 Sec. 91.016. [LICENSE ISSUANCE; TERM] ISSUANCE AND TERM OF
8-17 CERTIFICATE OF REGISTRATION. (a) The department shall issue a
8-18 [license] certificate of registration to an applicant determined to
8-19 meet the requirements of this chapter. [The department shall issue
8-20 the license not later than the 90th day after the date on which the
8-21 completed application is filed with the department.]
8-22 (b) A [license] certificate of registration issued by the
8-23 department under this chapter is valid for [one] two year. The
8-24 department shall renew a [license] certificate of registration on
8-25 receipt of a renewal application approved by the department and
8-26 payment of the required renewal fees.
8-27 Sec. 91.017. Fees. (a) Each applicant for an original or
8-28 renewal staff leasing services company [license] certificate of
8-29 registration shall pay to the department on the issuance of the
8-30 [license] certificate of registration or [license] certificate of
9-1 registration renewal a fee set by the commission by rule in an
9-2 amount not to exceed [$3,000] $1,000.
9-3 (b) The commission is authorized to charge reasonable fees
9-4 for [license] applications and renewals, [investigations,]
9-5 inspections, and any other administrative or enforcement
9-6 responsibilities created under this chapter.
9-7 (c) Fees collected by the department under this chapter
9-8 shall be used to implement this chapter.
9-9 Sec. 91.018. [LICENSE] CERTIFICATE OF REGISTRATION NOT
9-10 ASSIGNABLE; CHANGE OF NAME OR LOCATION. (a) A [license holder]
9-11 registrant may not conduct business under any name other than that
9-12 specified in the [license] certificate of registration. A
9-13 [license] certificate of registration issued under this chapter is
9-14 not assignable. A [license holder] registrant may not conduct
9-15 business under any fictitious or assumed name without prior written
9-16 authorization from the department. The department may not
9-17 authorize the use of a name that is so similar to that of a public
9-18 office or agency or to that of another [license holder] registrant
9-19 that the public may be confused or misled by the name's use. A
9-20 [license holder] registrant may not conduct business under more
9-21 than one name unless the [license holder] registrant has obtained a
9-22 separate [license] certificate of registration for each name.
9-23 (b) A [license holder] registrant may change the [license
9-24 holder's] registrant's [licensed] registered name at any time by
9-25 notifying the department and paying a fee for each change of name.
9-26 The commission by rule shall set the fee for a name change in an
9-27 amount not to exceed $50. A [license holder] registrant may change
9-28 the [license holder's] registrant's name on renewal of the
9-29 [license] certificate of registration without the payment of the
9-30 name change fee.
10-1 (c) A [license holder] registrant must notify the department
10-2 in writing of:
10-3 (1) any change in the location of the [license
10-4 holder's] registrant's primary business office;
10-5 (2) the addition of more business offices; or
10-6 (3) a change in the location of business records
10-7 maintained by the [license holder].
10-8 [Sec. 91.019. LIMITED LICENSE. (a) The commissioner by
10-9 rule shall provide for the issuance of a limited license for a
10-10 person who offers limited staff leasing services in this state and
10-11 is primarily engaged in offering staff leasing services in another
10-12 state. The principal place of business of a person offering staff
10-13 leasing services and who applies for a license under this section
10-14 must be located in a state other than this state.]
10-15 [(b) For purposes of this section, a person offers limited
10-16 staff leasing services if the person employs fewer than 20 assigned
10-17 employees.]
10-18 [(c) A person offering limited staff leasing services must
10-19 comply with all provisions of this chapter with respect to those
10-20 services performed within this state.]
10-21 Sec. 91.020. GROUNDS FOR DISCIPLINARY ACTION. (a) The
10-22 department may take disciplinary action against a [license holder]
10-23 registrant on any of the following grounds:
10-24 (1) being convicted or having a controlling person of
10-25 the [license holder] who is convicted of:
10-26 (A) bribery, fraud, or intentional or material
10-27 misrepresentation in obtaining, attempting to obtain, or renewing a
10-28 [license] certificate of registration;
10-29 (B) a crime that relates to the operation of a
10-30 staff leasing service or the ability of the [license holder]
11-1 registrant or any controlling person of the [license holder]
11-2 registrant to operate a staff leasing service;
11-3 (C) a crime that relates to the classification,
11-4 misclassification, or under-reporting of employees under Subtitle
11-5 A, Title 5;
11-6 (D) a crime that relates to the establishment or
11-7 maintenance of a self-insurance program, whether health insurance,
11-8 workers' compensation insurance, or other insurance; or
11-9 (E) a crime that relates to fraud, deceit, or
11-10 misconduct in the operation of a staff leasing service;
11-11 (2) [engaging] performing in staff leasing services
11-12 without a [license] certificate of registration;
11-13 (3) transferring or attempting to transfer a [license]
11-14 certificate of registration issued under this chapter;
11-15 (4) violating this chapter or any order or rule issued
11-16 by the department or commissioner under this chapter;
11-17 (5) failing after the 31st day after the date on which
11-18 a felony conviction of a controlling person is final to notify the
11-19 department in writing of the conviction;
11-20 (6) failing to cooperate with an investigation,
11-21 examination, or audit of the [license holder's] registrant's
11-22 records conducted by the [license holder's] registrant's insurance
11-23 company or the insurance company's designee, as allowed by the
11-24 insurance contract or as authorized by law by the Texas Department
11-25 of Insurance;
11-26 (7) failing after the 31st day after the effective
11-27 date of a change in ownership, principal business address, or the
11-28 address of accounts and records to notify the department and the
11-29 Texas Department of Insurance of the change;
11-30 (8) failing to correct any tax filings or payment
12-1 deficiencies within a reasonable time as determined by the
12-2 commissioner;
12-3 (9) refusing, after reasonable notice, to meet
12-4 reasonable health and safety requirements within the [license
12-5 holder's] registrant's control and made known to the [license
12-6 holder] registrant by a federal or state agency;
12-7 (10) being delinquent in the payment of the [license
12-8 holder's] registrant's insurance premiums other than those subject
12-9 to a legitimate dispute;
12-10 (11) being delinquent in the payment of any employee
12-11 benefit plan premiums or contributions other than those subject to
12-12 a legitimate dispute;
12-13 (12) knowingly making a material misrepresentation to
12-14 an insurance company or to the department or other governmental
12-15 agency; or
12-16 [(13) failing to maintain the net worth requirements
12-17 required under Section 91.014; or]
12-18 (14) using staff leasing services to avert or avoid an
12-19 existing collective bargaining agreement.
12-20 (b) For purposes of this section, "conviction" includes a
12-21 plea of nolo contendere or a finding of guilt, regardless of
12-22 adjudication.
12-23 Sec. 91.021. Disciplinary Procedures; Reinstatement.
12-24 (a) On a finding that a ground for disciplinary action exists
12-25 under one or more provisions of Section 91.020(a), the department
12-26 may:
12-27 (1) deny an application for a [license] certificate of
12-28 registration;
12-29 (2) revoke, restrict, or refuse to renew a [license]
12-30 certificate of registration;
13-1 (3) impose an administrative penalty in an amount not
13-2 less than [$1,000] $500 for each violation, but not more than
13-3 $50,000;
13-4 (4) issue a reprimand; or
13-5 (5) place the [license holder] registrant on probation
13-6 for the period and subject to conditions that the department
13-7 specifies.
13-8 (b) On revocation of a [license] certificate of
13-9 registration, the [license holder] registrant shall immediately
13-10 return the revoked [license] certificate of registration to the
13-11 department.
13-12 (c) Disciplinary action may be taken, an application for a
13-13 new or renewal [license] certificate of registration may be denied,
13-14 a [license] certificate of registration may be revoked, or a
13-15 determination that a controlling person is unqualified may be made
13-16 by the department only subject to Chapter 2001, Government Code,
13-17 with notice and an opportunity for hearing provided to the affected
13-18 applicant, [license holder] registrant, or controlling person.
13-19 (d) If a [license] certificate of registration is revoked or
13-20 renewal is denied, the affected [license holder] registrant may
13-21 request a reinstatement hearing after a minimum of one year. The
13-22 department may reinstate or renew the [license] certificate of
13-23 registration only if the cause of the revocation or nonrenewal has
13-24 been corrected.
13-25 SECTION 3. Subchapter C, Chapter 91, Labor Code, is amended
13-26 to read as follows:
13-27 Sec. 91.031. Agreement; Notice. (a) A [license holder]
13-28 registrant shall establish the terms of a staff leasing services
13-29 agreement by a written contract between the [license holder]
13-30 registrant and the client company.
14-1 (b) The [license holder] registrant shall give written
14-2 notice of the agreement as it affects assigned employees to each
14-3 employee assigned to a client company worksite.
14-4 Sec. 91.032. Contract Requirements. (a) A contract between
14-5 a [license holder] registrant and a client company must provide
14-6 that the [license holder]:
14-7 [(1) reserves the right of direction and control over
14-8 employees assigned to a client's worksites;]
14-9 (1) [(2)] assumes responsibility for the payment of
14-10 wages to the assigned employees [without regard to payments by the
14-11 client to the license holder;]
14-12 (2) [(3)] assumes administrative responsibility for
14-13 the payment of payroll taxes and collection of taxes from payroll
14-14 on assigned employees;
14-15 (3) [(4) retains the] reserves a right to hire, fire,
14-16 discipline, and reassign the assigned employees; and
14-17 (4) [(5) retains the right of direction and control]
14-18 reserves a contractual right over the adoption of employment and
14-19 safety policies and the management of workers' compensation claims,
14-20 claim filings, and related procedures.
14-21 SECTION 4. Subchapter D, Chapter 91, Labor Code, is amended
14-22 to read as follows:
14-23 Sec. 91.041. Employee Benefit Plans; Required Disclosure;
14-24 Other Reports. (a) A [license holder] registrant may sponsor and
14-25 maintain employee benefit plans for the benefit of assigned
14-26 employees. A client company may, but is not required to, include
14-27 assigned employees in any benefit plan, including workers'
14-28 compensation, sponsored by the client company.
14-29 (b) Each [license holder] registrant shall disclose to the
14-30 department, each client company, and its assigned employees
15-1 information relating to any insurance or benefit plan provided for
15-2 the benefit of its assigned employees. The information must
15-3 include:
15-4 (1) the type of coverage;
15-5 (2) the identity of each insurer for each type of
15-6 coverage;
15-7 (3) the amount of benefits provided for each type of
15-8 coverage and to whom or in whose behalf benefits are to be paid;
15-9 (4) the policy limits on each insurance policy; and
15-10 (5) whether the coverage is fully insured, partially
15-11 insured, or fully self-funded.
15-12 (c) The commissioner by rule may require a [license holder]
15-13 registrant to file other reports that are reasonably necessary for
15-14 the implementation of this chapter.
15-15 Sec. 91.042. Workers' Compensation Insurance. (a) A
15-16 [license holder] registrant may elect to obtain workers'
15-17 compensation insurance coverage for the [license holder's]
15-18 registrant's assigned employees through an insurance company as
15-19 defined under Section 401.011(28) or through self-insurance as
15-20 provided under Chapter 407.
15-21 (b) If a [license holder] registrant maintains a policy of
15-22 workers' compensation insurance provided by the Texas Workers'
15-23 Compensation Insurance Fund, the [license holder] registrant shall
15-24 pay workers' compensation insurance premiums based on the
15-25 experience rating of the client company for the first two years the
15-26 client company has a contract with the [license holder] registrant
15-27 and as further provided by rule by the Texas Department of
15-28 Insurance.
15-29 (c) [For workers' compensation insurance purposes, a license
15-30 holder and the license holder's client company shall be
16-1 coemployers.] If a [license holder] registrant elects to obtain
16-2 workers' compensation insurance, the client company and the
16-3 [license holder] registrant are subject to Sections 406.034 and
16-4 408.001. Accordingly, the client company is afforded the same
16-5 protection of exclusive remedy as the registrant.
16-6 (d) If a [license holder] registrant does not elect to
16-7 obtain workers' compensation insurance, both the [license holder]
16-8 registrant and the client company are subject to Sections 406.004
16-9 and 406.033, except when a client company elects to obtain a
16-10 workers' compensation policy on its own employees not assigned by
16-11 the registrant. Any policy of workers' compensation issued to the
16-12 client company for its own employees shall cover only those
16-13 employees and shall not extend to those employees assigned to the
16-14 client company by the registrant.
16-15 (e) After the expiration of the two-year period under
16-16 Subsection (b), if the client company obtains a new workers'
16-17 compensation insurance policy provided by the Texas Workers'
16-18 Compensation Insurance Fund in the company's own name or adds the
16-19 company's former assigned workers to an existing policy, the
16-20 premium for the workers' compensation insurance policy of the
16-21 company shall be based on the lower of:
16-22 (1) the experience modifier of the company before
16-23 entering into the staff leasing arrangement; or
16-24 (2) the experience modifier of the [license holder]
16-25 registrant's at the time the staff leasing arrangement terminated.
16-26 (f) On request, the Texas Department of Insurance shall
16-27 provide the necessary computations to the prospective workers'
16-28 compensation insurer of the client company to comply with
16-29 Subsection (e).
16-30 Sec. 91.043. Health Benefit Plans. (a) A [license holder]
17-1 registrant may not sponsor a plan of self-insurance for health
17-2 benefits [except as permitted by the Employee Retirement Income
17-3 Security Act of 1974 (29 U.S.C. Section 1001 et seq.)].
17-4 (b) For purposes of this section, a "plan of self-insurance"
17-5 includes any arrangement except an arrangement under which an
17-6 insurance carrier authorized to do business in this state has
17-7 issued an insurance policy that covers all of the obligations of
17-8 the health benefits plan.
17-9 Sec. 91.044. Unemployment Taxes; Payroll. (a) A [license
17-10 holder] registrant is the employer of an assigned employee for
17-11 purposes of Subtitle A, Title 4, Vernon's Texas Civil Statutes,
17-12 Labor Code, Section 201.001 et seq., and Chapter 61. In addition
17-13 to any other reports required to be filed by law, a [license
17-14 holder] registrant shall report quarterly to the Texas Employment
17-15 Commission on a form prescribed by the Texas Employment Commission
17-16 the name, address, telephone number, federal income tax
17-17 identification number, and classification code as described in the
17-18 "Standard Industrial Classification Manual" published by the United
17-19 States Office of Management and Budget of each client company.
17-20 (b) On contracting with a client company, a [license holder]
17-21 registrant shall notify the Texas Employment Commission of the
17-22 contract. The notification shall be made in the form prescribed by
17-23 the Texas Employment Commission.
17-24 (c) For purposes of Subtitle A, Title 4, in the event of the
17-25 termination of a contract between a [license holder] registrant and
17-26 a client company or the failure by a staff leasing entity to submit
17-27 reports or make tax payments as required by that subtitle, the
17-28 contracting client company shall be treated as a new employer
17-29 without a previous experience record unless that client company is
17-30 otherwise eligible for an experience rating.
18-1 (d) Confidentiality
18-2 Sec. 91.045. Posting Requirements. (a) Each [license
18-3 holder] registrant shall post in a conspicuous place in the
18-4 [license holder's] registrant's principal place of business in this
18-5 state the [license] certificate of registration issued under this
18-6 chapter.
18-7 (b) Each [license holder] registrant shall display, in a
18-8 place that is in clear and unobstructed public view, a notice
18-9 stating that the business operated at the location is [licensed]
18-10 registered and regulated by the department and that any questions
18-11 or complaints should be directed to the department.
18-12 (c) The Commissioner by rule shall determine the form and
18-13 content of the certificate of registration issued under this
18-14 chapter and the notices required to be posted under this section.
18-15 Sec. 91.046. Contractual Duties. Each [license holder]
18-16 registrant is responsible for the [license holder's] registrant's
18-17 contractual duties and responsibilities to manage, maintain,
18-18 collect, and make timely payments for:
18-19 (1) insurance premiums;
18-20 (2) benefit and welfare plans;
18-21 (3) other employee withholding; and
18-22 (4) any other expressed responsibility within the
18-23 scope of the contract for fulfilling the duties imposed under this
18-24 section and Sections 91.032, 91.047, and 91.048.
18-25 Sec. 91.047. Compliance with Other Laws. Each [license
18-26 holder] registrant shall comply with all appropriate state and
18-27 federal laws relating to reporting, sponsoring, filing, and
18-28 maintaining benefit and welfare plans.
18-29 Sec. 91.048. Required Information. Each [license holder]
18-30 registrant shall:
19-1 (1) maintain adequate books and records regarding the
19-2 license holder's duties and responsibilities;
19-3 (2) maintain and make available at all times to the
19-4 commissioner the following information, which shall be treated as
19-5 proprietary and confidential and is exempt from disclosure to
19-6 persons other than other governmental agencies having a reasonable,
19-7 legitimate purpose for obtaining the information:
19-8 (A) the correct name, address, and telephone
19-9 number of each client company;
19-10 (B) each client company contract; and
19-11 (C) a listing by classification code as
19-12 described in the "Standard Industrial Classification Manual"
19-13 published by the United States Office of Management and Budget of
19-14 each client company;
19-15 (3) notify the department of any addition or deletion
19-16 of a controlling person as listed on the [license] certificate of
19-17 registration application or renewal form by providing the name of
19-18 the person not later than the 30th day after the date on which the
19-19 person is added or deleted as a controlling person; and
19-20 (4) provide a notarized biographical history to the
19-21 department in connection with the addition of a new controlling
19-22 person.
19-23 Sec. 91.049. Agent for Service of Process. Each [license
19-24 holder] registrant shall maintain a registered agent for the
19-25 service of process in this state.
19-26 SECTION 5. Subchapter E, Chapter 91, Labor Code, is amended
19-27 to read as follows:
19-28 Sec. 91.061. Prohibited Acts. A person may not:
19-29 (1) [engage in] perform staff leasing services without
19-30 holding a [license] certificate of registration under this chapter
20-1 as a staff leasing services company;
20-2 (2) use the name or title "staff leasing company,"
20-3 "employee leasing company," "[licensed] registered staff leasing
20-4 company," or "staff leasing services company" or otherwise
20-5 represent that the entity is [licensed] registered under this
20-6 chapter unless the entity holds a [license] certificate of
20-7 registration issued under this chapter;
20-8 (3) represent as the person's own the [license]
20-9 certificate of registration of another person or represent that a
20-10 person is [licensed] registered if the person does not hold a
20-11 [license] certificate of registration;
20-12 (4) give materially false or forged evidence to the
20-13 department in connection with obtaining or renewing a [license]
20-14 certificate of registration or in connection with disciplinary
20-15 proceedings under this chapter; or
20-16 (5) use or attempt to use a [license] certificate of
20-17 registration that has expired or been revoked.
20-18 Sec. 91.062. Action by Attorney General. (a) The
20-19 commissioner may notify the attorney general of a violation of this
20-20 chapter. The attorney general may apply to a district court in
20-21 Travis County for permission to file for quo warranto relief,
20-22 injunctive relief, or both.
20-23 (b) The attorney general may not be required to post a bond
20-24 for injunctive relief under this section.
20-25 Sec. 91.063. Criminal Penalty. (a) A person who violates
20-26 Section 91.061 commits an offense.
20-27 (b) An offense under this section is a Class A misdemeanor.
20-28 SECTION 6. This Act takes effect September 1, 1997.
20-29 SECTION 7. The importance of this legislation and the
20-30 crowded condition of the calendars in both houses create an
21-1 emergency and an imperative public necessity that the
21-2 constitutional rule requiring bills to be read on three several
21-3 days in each house be suspended, and this rule is hereby suspended.