By: Carona S.B. No. 777
A BILL TO BE ENTITLED
AN ACT
1-1 relating to the authorization of certain deductions from an
1-2 employee's pay.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Section 61.018, Labor Code, is amended to read as
1-5 follows:
1-6 Sec. 61.018. DEDUCTION FROM WAGES. An employer may not
1-7 withhold or divert any part of an employee's wages unless the
1-8 employer:
1-9 (1) is ordered to do so by a court of competent
1-10 jurisdiction;
1-11 (2) is authorized to do so by state or federal law;
1-12 [or]
1-13 (3) has written authorization from the employee to
1-14 deduct part of the wages for a lawful purpose; or
1-15 (4) is authorized to do so for reimbursement under
1-16 Section 61.0185.
1-17 SECTION 2. Subchapter B, Chapter 61, Labor Code, is amended
1-18 by adding Section 61.0185 to read as follows:
1-19 Sec. 61.0185. WAGE DEDUCTIONS TO REIMBURSE EMPLOYER.
1-20 (a) Notwithstanding Section 42.001, Property Code, an employer may
1-21 withhold from any part of an employee's wages without authorization
1-22 from the employee a sum of money equal to the amount necessary to
1-23 reimburse the employer for:
2-1 (1) misappropriation by the employee in which the
2-2 employee obtained money from the employer without authorization;
2-3 (2) the overpayment of wages or another form of pay to
2-4 the employee regardless of the reason for the overpayment, if the
2-5 wage, salary, or other compensation agreement is in writing and
2-6 signed by the employer and employee;
2-7 (3) a loan in connection with the employee's
2-8 employment made by the employer to the employee;
2-9 (4) a wage advance from the employer to the employee;
2-10 or
2-11 (5) the reasonable cost to the employer of any benefit
2-12 received or obtained by the employee from the employer that the
2-13 employee failed to authorize the employer in writing to deduct from
2-14 the employee's wages.
2-15 (b) To withhold wages under Subsection (a), an employer must
2-16 show that a deduction from wages under Subsection (a) is permitted
2-17 by providing clear and convincing evidence or, if the deduction is
2-18 for a misappropriation under Subsection (a)(1), by a written
2-19 acknowledgement from the employee that the employee obtained the
2-20 money without authorization.
2-21 (c) A deduction from wages to reimburse an employer for a
2-22 loan or wage advance shall be permitted according to the terms of
2-23 any written agreement between the employer and employee. A loan
2-24 for which the repayment period exceeds one year must be evidenced
2-25 by a written repayment agreement signed by the employee or a person
3-1 legally authorized to sign for the employee.
3-2 (d) Unless a written agreement provides otherwise, an
3-3 employer may deduct from an employee's final paycheck the amount of
3-4 the loan or advance that is unpaid on the employee's separation
3-5 date if the deduction is permitted under Subsection (c).
3-6 (e) An employer making a deduction from wages under this
3-7 section must provide written notice to the employee of the reason
3-8 for each deduction. The notice must be delivered to the employee
3-9 not later than the scheduled payday for the wages from which the
3-10 deduction is to be made.
3-11 (f) An employer that makes a deduction from wages that is
3-12 not in accordance with the requirements of this section or Section
3-13 61.018 is subject to an administrative penalty under Section
3-14 61.053.
3-15 (g) In this section, "benefit" means anything of monetary
3-16 value, other than compensation for personal services, that an
3-17 employee requests and obtains from an employer and elects to
3-18 retain, in the following categories:
3-19 (1) benefits relating to the participation by the
3-20 employee or the employee's family in a health or legal insurance
3-21 plan;
3-22 (2) benefits relating to a pension or retirement plan
3-23 that is maintained for the benefit of the employee and in which the
3-24 employee has elected to participate;
3-25 (3) goods or services purchased on credit from the
4-1 employer for the personal use and convenience of the employee; or
4-2 (4) the personal, nonwork-related use of materials,
4-3 supplies, or equipment, other than materials, supplies, or
4-4 equipment that is customarily furnished by the employer for the
4-5 convenience of an employee during a rest or meal period, that
4-6 belongs to the employer and the use of which results in a charge or
4-7 expense that is incurred by the employer.
4-8 (h) The use by an employee of materials, supplies, or
4-9 equipment under Subsection (g)(4), the use of which is at the
4-10 election of and for the convenience of the employee, is considered
4-11 to have been requested and obtained by the employee from the
4-12 employer.
4-13 SECTION 3. This Act takes effect September 1, 1997, and
4-14 applies only to a claim for wages that arises on or after that
4-15 date. A claim for wages that arises before the effective date of
4-16 this Act is governed by the law in effect on the date the claim
4-17 arises, and the former law is continued in effect for that purpose.
4-18 SECTION 4. The importance of this legislation and the
4-19 crowded condition of the calendars in both houses create an
4-20 emergency and an imperative public necessity that the
4-21 constitutional rule requiring bills to be read on three several
4-22 days in each house be suspended, and this rule is hereby suspended.