SENATE ENGROSSED
|
HOUSE COMMITTEE
SUBSTITUTE
|
SECTION 1. The heading to
Chapter 91, Labor Code, is amended.
|
SECTION 1. Same as engrossed
version.
|
SECTION 2. Section 91.001,
Labor Code, is amended.
|
SECTION 2. Same as engrossed
version.
|
SECTION 3. Subchapter A,
Chapter 91, Labor Code, is amended by adding Sections 91.0011 and 91.0012
to read as follows:
Sec. 91.0011. COEMPLOYMENT
RELATIONSHIP.
Sec. 91.0012. COVERED
EMPLOYEE. (a) A covered employee must meet all the following criteria:
(1) the individual must
receive written notice of the coemployment relationship with the
professional employer organization; and
(2) the individual's
coemployment relationship must be under a professional employer services
agreement subject to this chapter.
(b) An individual who is
an executive employee, as described by Section 406.097, of the client is a
covered employee, except to the extent the professional employer
organization and the client expressly agree in the professional employer
services agreement that the individual is not a covered employee, if the individual meets the criteria of this
section and acts as an operational manager or performs day-to-day
operational services for the client.
|
SECTION 3. Chapter 91, Labor
Code, is amended by adding Sections 91.0011 and 91.0012 to read as follows:
Sec. 91.0011. COEMPLOYMENT
RELATIONSHIP.
Sec. 91.0012. COVERED
EMPLOYEE. (a) A covered employee must meet all the following criteria:
(1) the individual must
receive written notice of the coemployment relationship with the
professional employer organization; and
(2) the individual's coemployment
relationship must be under a professional employer services agreement
subject to this chapter.
(b) An individual who is
an executive employee, as described by Section 406.097, of the client is a
covered employee, except to the extent the professional employer
organization and the client expressly agree in the professional employer
services agreement that the individual is not a covered employee.
|
SECTION 4. Subsections (b)
and (c), Section 91.002, Labor Code, are amended
|
SECTION 4. Same as engrossed
version except for recitation.
|
SECTION 5. Subsection (a),
Section 91.003, Labor Code, is amended.
|
SECTION 5. Same as engrossed
version except for recitation.
|
SECTION 6. Sections 91.004,
91.005, 91.006, 91.007, 91.011, and 91.012, Labor Code, are amended.
|
SECTION 6. Same as engrossed
version.
|
SECTION 7. Subsections (a)
and (c), Section 91.014, Labor Code, are amended.
|
SECTION 7. Same as engrossed
version except for recitation.
|
SECTION 8. Subsection (a),
Section 91.015, Labor Code, is amended.
|
SECTION 8. Same as engrossed
version except for recitation.
|
SECTION 9. Subsection (a),
Section 91.017, Labor Code, is amended to read as follows:
(a) Each applicant for an
original or renewal professional employer organization [staff
leasing services company] license shall pay to the department before
the issuance of the license or license renewal a fee set by the commission
by rule.
|
SECTION 9. Sections 91.017(a)
and (c), Labor Code, are amended to read as follows:
(a) Each applicant for an
original or renewal professional employer organization [staff
leasing services company] license shall pay to the department before
the issuance of the license or license renewal a fee set by the commission
by rule.
(c)
Fees collected by the department under this chapter may [shall]
be used only to implement this chapter.
|
SECTION 10. Subsections (e)
and (f), Section 91.018, Labor Code, are amended.
|
SECTION 10. Same as engrossed
version except for recitation.
|
SECTION 11. Subsections (a),
(b), and (c), Section 91.019, Labor Code, are amended.
|
SECTION 11. Same as engrossed
version except for recitation.
|
SECTION 12. Section 91.020,
Labor Code, is amended.
|
SECTION 12. Same as engrossed
version.
|
SECTION 13. Subsection (b),
Section 91.021, Labor Code, is amended.
|
SECTION 13. Same as engrossed
version except for recitation.
|
SECTION 14. Subchapter C,
Chapter 91, Labor Code, is amended.
|
SECTION 14. Same as engrossed
version.
|
SECTION 15. Section 91.041,
Labor Code, is amended.
|
SECTION 15. Same as engrossed
version.
|
SECTION 16. Subchapter D,
Chapter 91, Labor Code, is amended by adding Section 91.0411 to read as
follows:
Sec. 91.0411. SELF-FUNDED
HEALTH BENEFIT. (a) Notwithstanding Section 91.001, in this section, "department" means the Texas Department
of Insurance.
(b) A license holder may
sponsor benefits that are not fully insured if the license holder meets the
requirements of Subsection (c) and is
approved by the department.
(c) The department may, on notice and opportunity
for all interested persons to be heard, adopt rules and issue orders
reasonably necessary to augment and implement the regulation of benefit
plans sponsored by a license holder that are not fully insured. The department may not adopt a rule that
requires clients or covered employees to be members of an association or
group in the same trade or industry.
The rules must include
all requirements that must be met by the license holder and the plan,
including:
(1) initial and final
approval requirements;
(2) authority to prescribe
forms and items to be submitted to the department
by the license holder;
(3) a fidelity bond;
(4) use of an independent
actuary;
(5) use of a third-party
administrator;
(6) authority for the department to examine an application or a
plan;
(7) the minimum number of
clients and covered employees covered by the plan;
(8) standards for those
natural persons managing the plan;
(9) the minimum amount of
gross contributions;
(10) the minimum amount of
written commitment, binder, or policy for stop-loss insurance;
(11) the minimum amount of
reserves; and
(12) a fee in an amount
reasonable and necessary to defray the costs of administering this section
to be deposited to the credit of the department's operating fund.
(d) Information submitted
under this section is confidential and not subject to public inspection.
(e) Each license holder
under this section shall appoint the commissioner
of the department as its resident agent for purposes of service of
process. The fee for that service is $50, payable at the time of
appointment.
(f) The department may examine the affairs of any
plan and shall have access to the records of the plan. The department may examine under oath a manager
or employee of the license holder in connection with the plan.
(g) In addition to any
requirement or remedy under a law, the department
may suspend, revoke, or limit the certificate of authority of a plan if the
department determines, after notice
and hearing, that the plan does not comply with this section. The department may notify the attorney general
of a violation of this section, and the attorney general may apply to a
district court in Travis County for leave to file suit in the nature of quo
warranto or for injunctive relief or both.
(h) A plan under this
section is subject to Chapters 404, 441, and 443, Insurance Code.
|
SECTION 16. Subchapter D,
Chapter 91, Labor Code, is amended by adding Section 91.0411 to read as
follows:
Sec. 91.0411. SELF-FUNDED
HEALTH BENEFIT PLAN. (a) In this section, "commissioner"
means the commissioner of insurance.
(b) A license holder may
sponsor a benefit plan that is not fully insured if the license holder
meets the requirements of this section
and is approved to sponsor the plan by the
commissioner.
(c) The commissioner may, on notice and opportunity
for all interested persons to be heard, adopt rules and issue orders
reasonably necessary to augment and implement the regulation of benefit
plans sponsored by a license holder that are not fully insured. The commissioner may not adopt a rule that
requires clients or covered employees to be members of an association or
group in the same trade or industry in order
to be covered by a license holder-sponsored benefit plan that is not fully
insured.
The rules must include all
requirements that must be met by the license holder and the plan,
including:
(1) initial and final
approval requirements;
(2) authority to prescribe
forms and items to be submitted to the commissioner
by the license holder;
(3) a fidelity bond;
(4) use of an independent
actuary;
(5) use of a third-party
administrator;
(6) authority for the commissioner to examine an application or a
plan;
(7) the minimum number of
clients and covered employees covered by the plan;
(8) standards for those
natural persons managing the plan;
(9) the minimum amount of
gross contributions;
(10) the minimum amount of
written commitment, binder, or policy for stop-loss insurance;
(11) the minimum amount of
reserves; and
(12) a fee in an amount
reasonable and necessary to defray the costs of administering this section
to be deposited to the credit of the operating fund of the Texas Department
of Insurance.
(d) Information submitted
under this section is confidential and not subject to disclosure under Chapter 552, Government Code.
(e) Each license holder
under this section shall appoint the commissioner
as its resident agent for purposes of service of process. The fee for that
service is $50, payable at the time of appointment.
(f) The commissioner may examine the affairs of any
plan and shall have access to the records of the plan. The commissioner may examine under oath a
manager or employee of the license holder in connection with the plan.
(g) In addition to any
requirement or remedy under a law, the commissioner
may suspend, revoke, or limit the authorization of a plan if the commissioner determines, after notice and
hearing, that the plan does not comply with this section. The commissioner may notify the attorney general
of a violation of this section, and the attorney general may apply to a
district court in Travis County for leave to file suit in the nature of quo
warranto or for injunctive relief or both.
(h) A plan under this
section is subject to Chapters 401,
404, 441, and 443, Insurance Code.
|
SECTION 17. Section 91.042,
Labor Code, is amended by amending Subsections (a) through (h) and adding
Subsections (a-1) and (a-2) to read as follows:
(a) A license holder or
client may elect to obtain workers' compensation insurance coverage for
covered [the license holder's assigned] employees through an
insurance company as defined under Section 401.011(28) or through
self-insurance as provided under Chapter 407.
(a-1) The client and the
professional employer organization shall specify in the professional
employer services agreement whether the parties have elected to obtain
workers' compensation insurance coverage for the covered employees and
shall specify which party must maintain coverage.
A copy of the professional
employer services agreement must be provided to the Texas Department of
Insurance on request. Information obtained by the Texas Department of
Insurance under this section is confidential and not subject to disclosure
under Chapter 552, Government Code.
(a-2) If the client elects
to maintain workers' compensation insurance coverage for the covered
employees under the client's policy or other coverage, the client shall pay
workers' compensation insurance premiums for the covered employees based on
the experience rating of the client.
(b) If a license holder
maintains workers' compensation insurance coverage for covered employees,
the license holder shall pay workers' compensation insurance premiums for
the covered employees based on the experience rating of the client [company]
for the first two years the covered employees are covered under the
professional employer organization's policy [client company has a
contract with the license holder] and as further provided by rule by
the Texas Department of Insurance.
(c) For workers' compensation
insurance purposes, a license holder and the license holder's client [company]
shall be coemployers. If either a license holder or a client
elects to obtain workers' compensation insurance coverage for covered
employees, the client [company] and the license holder are
subject to Sections 406.005, 406.034, [and] 408.001,
and 411.032.
(d) If a license holder or
a client does not elect to obtain workers' compensation insurance coverage
for covered employees, both the license holder and the client [company]
are subject to Sections 406.004, 406.005, [and] 406.033,
and 411.032.
(e) After the expiration of
the two-year period under Subsection (b), if the client elects to obtain
[company obtains a new] workers' compensation insurance coverage
for covered employees through coverage maintained by the client, or if the
professional employer services agreement is terminated and the client
elects to maintain, through coverage maintained by the client or through
coverage maintained by a successor professional employer organization,
workers' compensation insurance coverage for employees previously covered by
the former professional employer organization's policy [policy in
the company's own name or adds the company's former assigned workers to an
existing policy], the premium for the workers' compensation insurance coverage
for the client [policy of the company] shall be based on the
lower of:
(1) the experience modifier
of the client [company] before being covered under the
professional employer organization's coverage [entering into the
staff leasing arrangement]; or
(2) the experience modifier
of the license holder at the time the client's coverage under the
professional employer organization's coverage is [staff leasing
arrangement] terminated.
(f) On request, an insurer
[the Texas Department of Insurance] shall provide the necessary
computations to the prospective workers' compensation insurer of the client
[company] to comply with Subsection (e).
(g) On the written request of
a client [company], a license holder that elects to provide workers'
compensation insurance for covered [assigned] employees shall
provide to the client [company] a list of:
(1) claims associated with
that client [company] made against the license holder's workers'
compensation policy; and
(2) payments made and
reserves established on each claim.
(h) The license holder shall
provide the information described by Subsection (g) in writing from the
license holder's own records, if the license holder is a qualified
self-insurer, or from information the license holder received from the
license holder's workers' compensation insurance provider following the
license holder's request under Section 2051.151, Insurance Code, not later
than the 60th day after the date the license holder receives the client's
[client company's] written request. For purposes of this subsection,
information is considered to be provided to the client [company] on
the date the information is:
(1) received by the United
States Postal Service; or
(2) personally delivered to
the client [company].
|
SECTION 17. Section 91.042,
Labor Code, is amended by amending Subsections (a) through (h) and adding
Subsections (a-1), (a-2), and (c-1) to read as follows:
(a) A license holder or
client may elect to obtain workers' compensation insurance coverage for
covered [the license holder's assigned] employees through an
insurance company as defined under Section 401.011(28) or through
self-insurance as provided under Chapter 407.
(a-1) The client and the
professional employer organization shall specify in the professional
employer services agreement whether the parties have elected to obtain
workers' compensation insurance coverage for the covered employees and
shall specify which party must maintain coverage. If the license holder maintains workers' compensation insurance
coverage for the client, an individual who is an executive employee, as
described by Section 406.097, of the client is eligible to be treated as an
executive employee for premium calculation and classification purposes.
A copy of the professional
employer services agreement must be provided to the Texas Department of Insurance
on request. Information obtained by the Texas Department of Insurance under
this section is confidential and not subject to disclosure under Chapter
552, Government Code.
(a-2) If the client elects
to maintain workers' compensation insurance coverage for the covered
employees under the client's policy or other coverage, the client shall pay
workers' compensation insurance premiums for the covered employees based on
the experience rating of the client.
(b) If a license holder
maintains workers' compensation insurance coverage for covered employees,
the license holder shall pay workers' compensation insurance premiums for
the covered employees based on the experience rating of the client [company]
for the first two years the covered employees are covered under the
professional employer organization's policy [client company has a
contract with the license holder] and as further provided by rule by
the Texas Department of Insurance.
(c) For workers' compensation
insurance purposes, a license holder and the license holder's client [company]
shall be coemployers. If either a license holder or a client
elects to obtain workers' compensation insurance coverage for covered
employees, the client [company] and the license holder are
subject to Sections 406.005, 406.034, [and] 408.001,
and 411.032.
(c-1) Notwithstanding Subsection (c), for purposes of Section
462.308(a)(2), Insurance Code, the client is considered to be the insured
employer.
(d) If a license holder or
a client does not elect to obtain workers' compensation insurance coverage
for covered employees, both the license holder and the client [company]
are subject to Sections 406.004, 406.005, [and] 406.033,
and 411.032.
(e) After the expiration of
the two-year period under Subsection (b), if the client elects to obtain
[company obtains a new] workers' compensation insurance coverage
for covered employees through coverage maintained by the client, or if the
professional employer services agreement is terminated and the client
elects to maintain, through coverage maintained by the client or through
coverage maintained by a successor professional employer organization,
workers' compensation insurance coverage for employees previously covered
by the former professional employer organization's policy [policy in
the company's own name or adds the company's former assigned workers to an
existing policy], the premium for the workers' compensation insurance coverage
for the client [policy of the company] shall be based on the
lower of:
(1) the experience modifier
of the client [company] before being covered under the
professional employer organization's coverage [entering into the
staff leasing arrangement]; or
(2) the experience modifier
of the license holder at the time the client's coverage under the
professional employer organization's coverage is [staff leasing
arrangement] terminated.
(f) On request, an insurer
[the Texas Department of Insurance] shall provide the necessary
computations to the prospective workers' compensation insurer of the client
[company] to comply with Subsection (e).
(g) On the written request of
a client [company], a license holder that elects to provide workers'
compensation insurance for covered [assigned] employees shall
provide to the client [company] a list of:
(1) claims associated with
that client [company] made against the license holder's workers'
compensation policy; and
(2) payments made and
reserves established on each claim.
(h) The license holder shall
provide the information described by Subsection (g) in writing from the
license holder's own records, if the license holder is a qualified
self-insurer, or from information the license holder received from the
license holder's workers' compensation insurance provider following the
license holder's request under Section 2051.151, Insurance Code, not later
than the 60th day after the date the license holder receives the client's
[client company's] written request. For purposes of this subsection,
information is considered to be provided to the client [company] on
the date the information is:
(1) received by the United
States Postal Service; or
(2) personally delivered to
the client [company].
|
SECTION 18. Sections 91.044,
91.046, 91.048, 91.050, 91.061, 92.012, and 201.030, Labor Code, are
amended.
|
SECTION 18. Same as engrossed
version.
|
SECTION 19. Subsection (i),
Section 207.045, Labor Code, is amended.
|
SECTION 19. Same as engrossed
version except for recitation.
|
SECTION 20. The heading to
Section 415.011, Labor Code, is amended.
|
SECTION 20. Same as engrossed
version.
|
SECTION 21. Section 415.011,
Labor Code, is amended.
|
SECTION 21. Same as engrossed
version.
|
SECTION 22. Section 151.057,
Tax Code, is amended.
|
SECTION 22. Same as engrossed
version.
|
SECTION 23. Subdivision (15),
Section 171.0001, Tax Code, is amended to read as follows:
(15) "Professional
employer organization" ["Staff leasing services
company"] means:
(A) a business entity that
offers professional employer [staff leasing] services, as
that term is defined by Section 91.001, Labor Code; or
(B) a temporary employment
service, as that term is defined by Section 93.001, Labor Code.
|
SECTION 23. Section 171.0001,
Tax Code, is amended by amending Subdivisions (6) and (15) and adding
Subdivision (8-a) to read as follows:
(6)
"Client [company]" means:
(A)
a client as that term is defined by Section 91.001 [person that
contracts with a license holder under Chapter 91], Labor Code[, and
is assigned employees by the license holder under that contract]; or
(B)
a client of a temporary employment service, as that term is defined by
Section 93.001(2), Labor Code, to whom individuals are assigned for a
purpose described by that subdivision.
(8-a) "Covered employee" has the meaning assigned by
Section 91.001, Labor Code.
(15) "Professional
employer organization" ["Staff leasing services
company"] means:
(A) a business entity that
offers professional employer [staff leasing] services, as
that term is defined by Section 91.001, Labor Code; or
(B) a temporary employment
service, as that term is defined by Section 93.001, Labor Code.
|
SECTION 24. Subsection (b),
Section 171.101, Tax Code, is amended.
|
SECTION 24. Same as engrossed
version except for recitation.
|
SECTION 25. Subsection (k),
Section 171.1011, Tax Code, is amended.
|
SECTION 25. Same as engrossed
version except for recitation.
|
SECTION 26. Subsections (d)
and (e), Section 171.1013, Tax Code, are amended.
|
SECTION 26. Same as engrossed
version except for recitation.
|
SECTION 27. Section 171.2125,
Tax Code, is amended.
|
SECTION 27. Same as engrossed
version.
|
SECTION 28. The following
laws are repealed:
(1) Subdivision (2), Section
91.001, Labor Code; and
(2) Section 91.043, Labor
Code.
|
SECTION 28. The following
laws are repealed:
(1) Section 91.001(2), Labor
Code;
(2) Section 91.043, Labor
Code; and
(3)
Section 171.0001(2), Tax Code.
|
SECTION 29. (a) Not later
than January 1, 2014, the Texas Commission of Licensing and Regulation
shall adopt any rules necessary to administer Chapter 91, Labor Code, as
amended by this Act.
(b) The changes in law made
by this Act apply only to a professional employer services agreement
entered into on or after the effective date of this Act. An agreement
entered into before the effective date of this Act is governed by the law
in effect on the date the agreement is entered into, and the former law is
continued in effect for that purpose.
|
SECTION 29. (a) Not later
than January 1, 2014, the Texas Commission of Licensing and Regulation
shall adopt any rules necessary to administer Chapter 91, Labor Code, as
amended by this Act.
(b) The changes in law made
by this Act apply only to a professional employer services agreement
entered into on or after the effective date of this Act. An agreement
entered into before the effective date of this Act is governed by the law
in effect on the date the agreement is entered into, and the former law is
continued in effect for that purpose.
(c)
Section 91.042(c-1), Labor Code, as added by this Act, is not intended to
change the interpretation of Section 462.308, Insurance Code, but is
intended to clarify the application of that section.
(d)
In adopting rules to implement Section 91.0411, Labor Code, as added by
this Act, the commissioner of insurance shall consider rules adopted with
respect to similar benefit plans.
|
|
.
|
SECTION 30. This Act takes
effect September 1, 2013.
|
SECTION 30. Same as engrossed
version.
|
|