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A BILL TO BE ENTITLED
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AN ACT
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relating to the minimum wage. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 62.051, Labor Code, is amended to read as |
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follows: |
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Sec. 62.051. MINIMUM WAGE. (a) Except as otherwise |
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provided by this section [Section 62.057], an employer shall pay to |
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each employee not less than $19 an hour. |
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(b) Notwithstanding Subsection (a), and except as provided |
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by Subsection (c), an employer shall pay to each employee not less |
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than the greater of: |
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(1) the minimum wage established under Subsection (a); |
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or |
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(2) the amount set as the federal minimum wage under |
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Section 6, Fair Labor Standards Act of 1938 (29 U.S.C. Section 206). |
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(c) Beginning on October 1, 2026, an employer shall pay to |
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an employee not less than the minimum wage established under |
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Subsection (d). |
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(d) Except as provided by Subsection (e), on June 1, 2026, |
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and every year thereafter, the commission shall adjust the minimum |
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wage established under Subsection (b) for inflation. The adjusted |
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minimum wage rate shall be computed to the nearest cent using the |
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consumer price index for all urban consumers (CPI-U), as computed |
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by the United States Department of Labor for the preceding 12 |
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months, or an analogous index adopted by the commission by rule. |
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The commission by rule shall: |
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(1) describe the process used in computing inflation |
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rates and the procedure for determining the level of inflation used |
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in the commission's computations; and |
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(2) based on the computations under Subdivision (1), |
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set the state minimum wage for the subsequent calendar year. |
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(e) The commission may not adjust the minimum wage under |
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Subsection (d) to an amount that is less than the minimum wage for |
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the preceding calendar year. |
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(f) This section does not apply to compensation paid to a |
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person under Section 62.057 or to a tipped employee under Section |
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62.052. |
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SECTION 2. Section 62.052, Labor Code, is amended to read as |
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follows: |
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Sec. 62.052. TIPPED EMPLOYEES. (a) [In determining the |
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wage of a tipped employee, the amount paid the employee by the |
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employer is the amount described as paid to a tipped employee under |
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Section 3(m), Fair Labor Standards Act of 1938 (29 U.S.C. Section |
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203(m)). |
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[(b)] In this section, "tipped employee" means an employee |
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engaged in an occupation in which the employee customarily and |
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regularly receives more than $20 a month in tips. |
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(b) An employer shall pay to each tipped employee the |
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federal minimum wage under Section 6, Fair Labor Standards Act of |
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1938 (29 U.S.C. Section 206(a)(1)). The amount paid to an employee |
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may not be reduced by a tip credit against the minimum wage. |
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(c) This section may not be construed to allow an employer |
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to keep any portion of a tipped employee's tips. |
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SECTION 3. Section 497.004(a), Government Code, is amended |
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to read as follows: |
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(a) The board shall [may] develop by rule and the department |
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shall [may] administer an incentive pay scale for work program |
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participants consistent with rules adopted by the board under |
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Subchapter C. The board shall set pay levels at a minimum of the |
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federal minimum wage under Section 6, Fair Labor Standards Act of |
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1938 (29 U.S.C. Section 206(a)(1)). Prison industries may be |
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financed through contributions donated for this purpose by private |
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businesses contracting with the department. The department shall |
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apportion pay earned by a work program participant in the same |
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manner as is required by rules adopted by the board under Section |
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497.0581. |
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SECTION 4. Section 497.099(b), Government Code, is amended |
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to read as follows: |
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(b) The board shall [may] develop by rule and the department |
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shall [may] administer an incentive pay scale program for inmates |
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required to work in agricultural, industrial, or other work |
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programs. In developing the program, the board shall set pay levels |
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not to unjustly reward inmates, but rather to instruct inmates on |
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the virtues of diligent participation in the workplace, provided |
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that the board shall set pay levels at a minimum of the federal |
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minimum wage under Section 6, Fair Labor Standards Act of 1938 (29 |
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U.S.C. Section 206(a)(1)). The department shall deposit an amount |
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earned by an inmate under this subsection into the inmate's trust |
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fund and may deduct not more than 80 percent of the amount deposited |
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under this subsection for payment of restitution and dependent care |
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owed by the inmate. [This subsection does not apply to the |
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compensation of an inmate participating in a Texas Correctional |
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Industries program under Subchapter A or an inmate participating in |
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a private sector prison industries program under Subchapter C.] |
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SECTION 5. Section 62.151, Labor Code, is repealed. |
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SECTION 6. Not later than December 1, 2025, the Texas Board |
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of Criminal Justice shall adopt the rules required by Sections |
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497.004(a) and 497.099(b), Government Code, as amended by this Act. |
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SECTION 7. This Act takes effect September 1, 2025. |