Employment Policy in Texas

The number and scope of laws which governs the policy on employment in the state of Texas has grown steadily over the past years. Although some areas of labor and employment law are exclusively covered by federal law, others are governed by the “so-called” supplemental state laws, and many of which remain to be exclusively of state or even local concern. The basic of Texas employment laws cover the following topics:

  • Employment relationship

  • Employment discrimination

  • Wages and hours

  • Safety in the workplace

We will endeavor to cite the relevant Texas provisions of law whenever necessary. However, we would like to emphasize that none of these is an exhaustive discussion of the relevant provisions nor constitute any legal advice. For more detailed legal advice on your corresponding circumstance, one of our dedicated Business Specialists will be able to assist you accordingly.

In Texas, state and federal law differs and an employer is covered by both. In any event that there is inconsistency with state and federal law, the stricter standard must be followed.

Employment Relationship

  • Employment At-Will: Every employment relationship in Texas is "at-will", that is terminable by either party. Both the employer and the employee may terminate the employment relationship for any reason at any time. This however admits of the legal limits set by law as employers may not discharge an employee based on any legally prohibited reason such as: disability, gender, sexual preference, age, race, color, religion, ethnicity or participation in a general public evacuation under an emergency order.

    Written representations in an employee handbook do not give rise to a contractual obligation with the exception of payment for accrued vacation or sick leave. While in Texas it is acceptable that an employer and employee may agree that an employee can be terminated for good cause, the same can only be valid if expressly and unequivocally done. Another situation wherein an employee handbook may be found to have created a valid binding contract is when it contains detailed procedures regarding discipline and termination for good cause.

  • Labor Organizations and Relations: The labor regulations in the private sector are regulated primarily under federal law and in particular the National Labor Relations Act (NLRA) 29 U.S.C. § 151, et seq., which guarantees that employees have the right to: form, assist, or belong to labor organizations; collectively bargain through their choice of representatives; engage in other concerted activities; and employers are to refrain from activities which interferes, coerce, restraints with their rights.
    The state of Texas does not have a comprehensive set of traditional labor laws however those employers not covered by federal law, like small business owners who may be covered by Texas laws that afford workers the right to associate together and to form trade unions for the protection of their rights under Tex. Lab. Code § 101.001 et seq.
    Peaceful picketing by employees or their respective unions is duly protected under the First Amendment to the United States Constitution. As a result of participation in such, a group health or accident insurance for which an employer is under obligation to pay any percentage of the premiums under an agreed collective bargaining agreement may not be suspended during a strike for a period of 6 months if said premiums are timely paid by the employee.
    There is a Labor arbitration Board in the state of Texas and is available in arbitrating disputes not covered by the NLRA and was established under Tex. Lab. Code § 102.001 et seq.

  • Pre-Employment Screening: In Texas, an employer may require the following screening prior to employment in compliance various legislations:
    (i) Drug and Alcohol Testing, 41 U.S.C. §§ 701-707, 42 U.S.C. § 12114, DrugFree Workplace Act of 1988.
    (ii) Medical and Genetic Testing, Tex. Lab. Code § 21.402, Tex. Ins. Code§ 546.052 which can be done after an offer of employment has been given.
    (iii) Criminal Background Checks, Tex. Health & Safety Code § 765.001, et seq., Tex. Educ. Code § 22.0834.
    Texas law expressly allows employers who operate residential dwellings and whose employees will have access to individual dwellings to request that job applicants disclose their criminal history under Tex. Health & Safety Code, § 765.001 et seq. School workers are also required to obtain criminal background reports under Tex. Educ. Code § 22.0834. There is likewise a mandatory criminal history background check for Health Care Workers under Tex. Health & Safety Code §250.001, et seq. and school bus drivers under Tex. Educ. Code § 22.084. Although solely regulated by federal law, an employer may obtain a credit report for a prospective employee under 15 U.S.C. § 1681 et seq.

    An employee in Texas is entitled for a retirement benefit under 29 U.S.C. §§ 1101-1461 and an employer may purchase a life insurance policy for an employee that names the employer as the beneficiary only if the said employer has an "insurable interest" in that employee, or the death of the latter will cause the employer substantial financial hardship. A group life insurance may be issued to employers for the benefits of their employees and their dependents under Tex. Ins. Code § 1131.051, et seq. Each employee must have a mandatory time off under Tex. Lab. Code § 52.001.
    While private employers are usually not subject to the constitutional restrictions against governmental searches and seizures of private property, however an employee may have a cause of action under common law privacy principles. It is illegal in Texas to use information which was intercepted during a telephone conversation without the consent of all the parties, even if one party is your employee. Employees do not have the right to inspect their own personal records unless both the employer and employee agree in an employment contract or CBA under Tex. Lab. Code §§ 103.003-05.
    For more detailed advice regarding your employment relationship, feel free to contact us today and our dedicated Business Specialists will be more than happy to assist you.

Employment Discrimination.

Under Title VII of the federal Civil Rights Act of 1964, employers with at least 15 employees are prohibited from discriminating employees on the basis of race, color, religion, gender and national origin as well as against retaliation against employees who oppose unlawful discrimination and allows the employees to sue for back wages, reinstatement, and attorney’s fees. The plaintiff may also recover compensatory and punitive damages up to a maximum combined amount of $300,000 depending on the size of the employer.
Employment rights in the workplace is enforced by the Texas Workforce Commission Civil Rights Division which provides assistance to employers seeking to avoid civil rights violations in their business environment. The Commission enforces Texas Civil Rights Statutes prohibiting discrimination against employees on the basis of race, color, national origin, sex, disability, age or religion.
Foreign language speakers are likewise protected against discrimination in the state of Texas. Nowadays, Texas is faced with an increasingly multilingual workforce. While the law does not prohibit “English only” policies, these rules may still amount to prohibited national origin discrimination under certain circumstances.
When in doubt as to whether the action of your employer constitutes discrimination in the workplace, contact us for a detailed assessment and legal advice of your circumstance.

Wages and Hours.

The current federal minimum wage for adults is $7.25 per hour and employers may pay those under the age of 20 for $4.25 an hour for the first 90 days of employment under Tex. Lab. Code § 62.051. The Federal Fair Labor Standards Act (FLSA) applies to those employers who make at least $500,000 in yearly business or to smaller businesses engaged in interstate commerce and also applies to schools, hospitals, most domestic workers, and federal state and local agencies. If an employer is not covered under FLSA, then they are covered by the Texas Minimum Wage Act (TMWA).
The pay requirements under Tex. Lab. Code § 62.001 et seq. allows an employer to pay an employee with a wage as low as 60% of the state minimum wage if the person’s earning capacity is impaired by factors such as age, physical or mental challenges, injury or when over the age of 65 and agricultural employers may pay hand harvest laborers by the piece at the rate allowed by the Commissioner of Agriculture.
Both FLSA and the TMWA require that an employer pays for overtime in excess of over 40 hours per week of service rendered by the employee. Said employee must be paid at a rate of 1.5 times the employee’s regular hourly rate. In addition, there is a voluntary workers’ compensation system in Texas. A workers’ compensation insurance will provide for lost wages and medical benefits to employees or their heirs after being injured or killed while in the performance of their tasks within the course and scope of their employment or has developed a work-related injury
Texas employers are not required to pay their employees for vacation, holiday, or sick time under Tex. Lab. Code § 61.001, 29 U.S.C. § 2600 et seq. however, most choose to do so. Employers must permit employees to be absent from work on Election Day for the purpose of voting under Tex. Election Code § 276.004. In addition the Texas Unemployment Compensation Act (TUCA) provides that all covered employers must pay taxes into a state fund for later use as unemployment benefits to qualified employees and is administered by the Texas Workforce Commission.
For more detailed legal advice with regards to your wages, hours and entitlement under Texas law, feel free to contact us today and our dedicated team of Business Specialists will be able to assist you.

Safety in the Workplace.

All employers in the state of Texas regardless of their number of employees are subject to the provision of the federal Occupational Safety and Health Act 1970 which established the Occupational Safety and Health Administration (OSHA). This regulation imposes a general duty for employers to provide a safe and healthy working environment for its employees.
Tex. Penal Code § 48.01 prohibits smoking or possession of a burning cigarette inside a public primary or secondary school, elevator, enclosed theater, library, hospital, museum, transit system, train, plane which is a public place. Employers may designate all or part of their place of business to be a non-smoking environment. Hazardous chemicals under Tex. Health & Safety Code, § 502.003 et seq. provides for the Texas Hazard Communication Act which requires employers to advise their employees of the dangers and possible effects of potential exposures to hazardous chemicals used within the business premises. The employer must report the accident to the Texas Department of State Health Services (DSHS) within 48 hours which directly or indirectly involved chemical exposure which is fatal to at least one employee or resulted in hospitalization of at least five employees.
The Agricultural Hazard Act applies to all agricultural workers who cultivate, harvest, or handle raw agricultural products for an employer who uses more than 55 gallons or 500 lbs. of toxic chemicals or a lesser amount as determined by the DSHS, or whose payroll is at least $50,000 a year for regular workers and $15,000 for seasonal workers. Only chemicals under the federal Insecticide, Fungicide, and Rodenticide Act, 7 U.S.C. § 136, et seq., and fertilizers with chemicals classified as dangerous in 29 C.F.R. 1910.1200(c) or 1910.1200(d) (3), including those listed or defined in subsequent comparable regulations.
There are numerous state and federal laws regulating areas of labor and employee relations that each employer based in Texas must comply with. While this article is designed to help both employees and employers obtain the desired protection under Texas employment policy, this does not constitute any form of legal advice. For detailed legal advice and assessment of your unique circumstance, please contact us and one of our dedicated Business Specialist will be more than happy to assist you.