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2005 Texas Labor Code CHAPTER 91. STAFF LEASING SERVICES
LABOR CODE SUBTITLE E. REGULATION OF CERTAIN OCCUPATIONS CHAPTER 91. STAFF LEASING SERVICES SUBCHAPTER A. GENERAL PROVISIONS § 91.001. DEFINITIONS. In this chapter: (1) "Applicant" means a business entity applying for a license or the renewal of a license under this chapter. (2) "Assigned employee" means an employee under a staff leasing services arrangement whose work is performed in this state. The term does not include an employee hired to support or supplement a client company's work force in a special work situation, including: (A) an employee absence; (B) a temporary skill shortage; (C) a seasonal workload; or (D) a special assignment or project. (3) "Client company" means a person that contracts with a license holder and is assigned employees by the license holder under that contract. (4) "Commission" means the Texas Commission of Licensing and Regulation. (5) Repealed by Acts 2003, 78th Leg., ch. 816, § 14.010(1). (6) "Common ownership" means a direct or indirect ownership interest in excess of 33-1/3 percent. The term includes ownership through subsidiaries or affiliates. (7) "Controlling person" means an individual who: (A) possesses direct or indirect control of 25 percent or more of the voting securities of a corporation that offers or proposes to offer staff leasing services; (B) possesses the authority to set policy and direct management of a company that offers or proposes to offer staff leasing services; (C) is employed, appointed, or authorized by a company that offers or proposes to offer staff leasing services to enter into a contract with a client company on behalf of the company; or (D) a person who is an officer or director of a corporation or a general partner of a partnership that offers or proposes to offer staff leasing services. (8) "Department" means the Texas Department of Licensing and Regulation. (8-a) "Executive director" means the executive director of the department. (9) "Governmental entity" means this state, or an agency, county, or municipality of this state. (10) "Independent contractor" means a person who contracts to perform work or provide a service for the benefit of another and who: (A) is paid by the job, not by the hour or some other time-measured basis; (B) is free to hire as many helpers as the person desires and to determine what each helper will be paid; and (C) is free to work for other contractors, or to send helpers to work for other contractors, while under contract to the hiring employer. (11) "License holder" means a person licensed under this chapter to provide staff leasing services. (12) "Net worth" of an applicant means the applicant's assets minus the applicant's liabilities, as shown on the applicant's financial statement or most recent federal tax return, plus the sum of any guarantees, letters of credit, or securities that may be submitted to the department. (13) "Offer" means a proposal for acceptance or rejection that is made in such a form that the promises or performance to be rendered by each party are reasonably certain. (14) "Staff leasing services" means an arrangement by which employees of a license holder are assigned to work at a client company and in which employment responsibilities are in fact shared by the license holder and the client company, the employee's assignment is intended to be of a long-term or continuing nature, rather than temporary or seasonal in nature, and a majority of the work force at a client company worksite or a specialized group within that work force consists of assigned employees of the license holder. The term includes professional employer organization services. The term does not include: (A) temporary help; (B) an independent contractor; (C) the provision of services that otherwise meet the definition of "staff leasing services" by one person solely to other persons who are related to the service provider by common ownership; or (D) a temporary common worker employer as defined by Chapter 92. (15) "Staff leasing services company" means a business entity that offers staff leasing services. The term includes a professional employer organization. (16) "Temporary help " means an arrangement by which an organization hires its own employees and assigns them to a client to support or supplement the client's work force in a special work situation, including: (A) an employee absence; (B) a temporary skill shortage; (C) a seasonal workload; or (D) a special assignment or project. (17) "Wages" means: (A) compensation for labor or services rendered by an assigned employee, whether computed on a time, task, piece, or other basis; and (B) vacation pay, holiday pay, sick leave pay, parental leave pay, severance pay, bonuses, commissions, stock option grants, or deferred compensation owed to an assigned employee under a written agreement. Added by Acts 1995, 74th Leg., ch. 76, § 9.20(a), eff. Sept. 1, 1995. Amended by Acts 1997, 75th Leg., ch. 1379, § 1, eff. Sept. 1, 1997; Acts 1999, 76th Leg., ch. 771, § 1, eff. Sept. 1, 1999; Acts 2003, 78th Leg., ch. 816, § 14.001, 14.010(1), eff. Sept. 1, 2003; Acts 2003, 78th Leg., ch. 833, § 1, eff. Sept. 1, 2003. § 91.002. RULES. (a) The commission shall adopt rules as necessary to administer this chapter. (b) Each person who offers staff leasing services is subject to this chapter and the rules adopted by the commission. (c) Notwithstanding any other provision of this chapter, nothing in this chapter preempts the existing statutory or rulemaking authority of any other state agency or entity to regulate staff leasing services in a manner consistent with the statutory authority of that state agency or entity. Added by Acts 1995, 74th Leg., ch. 76, § 9.20(a), eff. Sept. 1, 1995. Amended by Acts 1997, 75th Leg., ch. 1379, § 2, eff. Sept. 1, 1997; Acts 1999, 76th Leg., ch. 771, § 2, eff. Sept. 1, 1999; Acts 2003, 78th Leg., ch. 816, § 14.002, eff. Sept. 1, 2003. § 91.003. INTERAGENCY COOPERATION. (a) Each state agency that in performing duties under other law affects the regulation of staff leasing services shall cooperate with the department and other state agencies as necessary to implement and enforce this chapter. (b) In particular, the Texas Workforce Commission, the division of workers' compensation of the Texas Department of Insurance, the Department of Assistive and Rehabilitative Services, and the attorney general's office shall assist in the implementation of this chapter and shall provide information to the department on request. Added by Acts 1995, 74th Leg., ch. 76, § 9.20(a), eff. Sept. 1, 1995. Amended by Acts 1997, 75th Leg., ch. 1379, § 3, eff. Sept. 1, 1997; Acts 2003, 78th Leg., ch. 816, § 26.016, eff. Sept. 1, 2003; Acts 2005, 79th Leg., ch. 265, § 3.001, eff. Sept. 1, 2005. § 91.004. EFFECT OF OTHER LAW ON CLIENTS AND EMPLOYEES. (a) This chapter does not exempt a client of a license holder, or any assigned employee, from any other license requirements imposed under local, state, or federal law. (b) An employee who is licensed, registered, or certified under law and who is assigned to a client company is considered to be an employee of the client company for the purpose of that license, registration, or certification. (c) A license holder is not engaged in the unauthorized practice of an occupation, trade, or profession that is licensed, certified, or otherwise regulated by a governmental entity solely by entering into a staff leasing agreement with a client company and assigned employees. Added by Acts 1995, 74th Leg., ch. 76, § 9.20(a), eff. Sept. 1, 1995. Amended by Acts 1997, 75th Leg., ch. 1379, § 4, eff. Sept. 1, 1997. § 91.005. APPLICATION OF CERTAIN PROCUREMENT LAWS. With respect to a bid, contract, purchase order, or agreement entered into with the state or a political subdivision of the state, a client company's status or certification as a small, minority-owned, disadvantaged, or woman-owned business enterprise or as a historically underutilized business is not affected because the client company has entered into an agreement with a license holder or uses the services of a license holder. Added by Acts 1999, 76th Leg., ch. 771, § 3, eff. Sept. 1, 1999. § 91.006. WORKERS' COMPENSATION COVERAGE. (a) A certificate of insurance coverage showing that a license holder maintains a policy of workers' compensation insurance constitutes proof of workers' compensation insurance coverage for the license holder and the client company with respect to all employees of the license holder assigned to the client company. The state and a political subdivision of the state shall accept a certificate of insurance coverage described by this section as proof of workers' compensation coverage under Chapter 406. (b) For a client company that has employees who are not assigned employees under a staff leasing services agreement, the state or a political subdivision of the state may require the client company to furnish separate proof of workers' compensation insurance coverage for those employees. Added by Acts 1999, 76th Leg., ch. 771, § 3, eff. Sept. 1, 1999. § 91.007. APPLICATION OF LABOR RELATIONS LAWS. This chapter does not relieve a client company of a right, obligation, or duty under: (1) Chapter 101; (2) the federal National Labor Relations Act (29 U.S.C. Section 151 et seq.); (3) the federal Railway Labor Act (45 U.S.C. Section 151 et seq.); or (4) any other law governing labor relations. Added by Acts 1999, 76th Leg., ch. 771, § 3, eff. Sept. 1, 1999. § 91.008. APPLICABILITY OF CONTINUING EDUCATION LAW. Section 51.405, Occupations Code, does not apply to this chapter. Added by Acts 2003, 78th Leg., ch. 816, § 14.003, eff. Sept. 1, 2003.SUBCHAPTER B. LICENSE REQUIREMENTS § 91.011. LICENSE REQUIRED. A person may not engage in or offer staff leasing services in this state unless the person holds a license issued under this chapter. Added by Acts 1995, 74th Leg., ch. 76, § 9.20(a), eff. Sept. 1, 1995. § 91.012. GENERAL LICENSE REQUIREMENTS. To be qualified to serve as a controlling person of a license holder under this chapter, that person must be at least 18 years of age and have educational, managerial, or business experience relevant to: (1) operation of a business entity offering staff leasing services; or (2) service as a controlling person of a staff leasing services company. Added by Acts 1995, 74th Leg., ch. 76, § 9.20(a), eff. Sept. 1, 1995. Amended by Acts 1997, 75th Leg., ch. 1379, § 5, eff. Sept. 1, 1997. § 91.013. BACKGROUND INVESTIGATIONS. (a) On receipt of an original application for a license, the department shall conduct a thorough background investigation of each individual applicant and of each controlling person of each applicant to determine whether that applicant or controlling person is qualified under this chapter. The department may deny an application for the issuance of a license if the department finds that an applicant or a controlling person is not qualified under this chapter. The investigation must include: (1) the submission of fingerprints for processing through appropriate local, state, and federal law enforcement agencies; and (2) examination by the department of police or other law enforcement records maintained by local, state, or federal law enforcement agencies. (b) Department background investigations are governed by this chapter, Section 411.122, Government Code, and Chapter 53, Occupations Code. Conviction of a crime does not automatically disqualify a controlling person, require the revocation of a license, or require the denial of an application for a new or renewed license. The department shall consider criminal convictions as provided by Section 411.122, Government Code, and Chapter 53, Occupations Code. Added by Acts 1995, 74th Leg., ch. 76, § 9.20(a), eff. Sept. 1, 1995. Amended by Acts 1997, 75th Leg., ch. 1379, § 6, eff. Sept. 1, 1997; Acts 2001, 77th Leg., ch. 1420, § 14.815, eff. Sept. 1, 2001. § 91.014. NET WORTH REQUIREMENTS. (a) An applicant for an original or renewal license must demonstrate a net worth as follows: (1) $50,000 if the applicant employs fewer than 250 assigned employees; (2) $75,000 if the applicant employs at least 250 but not more than 750 assigned employees; and (3) $100,000 if the applicant employs more than 750 assigned employees. (b) The applicant may demonstrate the applicant's net worth to the department by providing the department with the applicant's financial statement or a copy of the applicant's most recent federal tax return. The applicant may also satisfy the net worth requirement through guarantees, letters of credit, a bond in an amount that demonstrates compliance with the requirements of Subsection (a), or other security acceptable to the department. A guaranty is not acceptable to satisfy this subsection unless the applicant submits sufficient evidence to satisfy the department that the guarantor has adequate resources to satisfy the obligations of the guaranty. (c) In computing net worth, an applicant shall include adequate reserves for all taxes and insurance, including reserves for claims incurred but not paid and for claims incurred but not reported under plans of self-insurance for health benefits. The computation of net worth by an applicant is to be made according to Section 448, Internal Revenue Code (26 U.S.C. Section 448). (d) A document submitted to establish net worth must show the net worth on a date not earlier than nine months before the date on which the application is submitted. A document submitted to establish net worth must be prepared or certified by an independent certified public accountant. Information submitted to or maintained by the department is subject to Chapter 552, Government Code, other than information related to: (1) identification of client companies; (2) net worth; (3) financial statements; or (4) federal tax returns. Added by Acts 1995, 74th Leg., ch. 76, § 9.20(a), eff. Sept. 1, 1995. Amended by Acts 1997, 75th Leg., ch. 1379, § 7, eff. Sept. 1, 1997. § 91.015. LICENSE APPLICATION. (a) To receive a staff leasing services company original license, a person shall file with the department a written application accompanied by the application fee. (b) The department shall require an applicant for a license to provide information necessary to determine that the applicant meets the licensing requirements of this chapter. The department shall also require the applicant to provide information necessary to determine whether individuals affiliated with the applicant are qualified to serve as controlling persons. (c) Before denying a license application, the department shall provide written notice to an applicant specifying the reasons for the denial. The department shall provide the applicant at least 30 days after the date of the notice to address the reasons for the denial. For good cause and on a showing of a good faith effort to remedy the reasons for the denial, the executive director may grant an additional 30 days to remedy the reasons for denial. (d) Removal, demotion, or discharge of a controlling person in response to notice from the department of the alleged unsuitability of that controlling person is an affirmative defense to any claim by that individual based on the removal, demotion, or discharge. (e) A controlling person who has been evaluated by the department under this chapter is not required to be reevaluated if that person changes the person's affiliation or employment from one applicant or license holder to another applicant or license holder. (f) Following denial or revocation of a license, and prior to issuing a new license or reinstating a license, the department shall consider: (1) the extent to which the applicant or license holder has adequately corrected any problems; and (2) whether the applicant or license holder has demonstrated that the applicant or license holder had exercised due diligence to avoid the reason or reasons for the denial or revocation. The applicant or license holder shall bear the burden of proof with respect to Subdivisions (1) and (2). Added by Acts 1995, 74th Leg., ch. 76, § 9.20(a), eff. Sept. 1, 1995. Amended by Acts 1997, 75th Leg., ch. 1379, § 8, eff. Sept. 1, 1997; Acts 1999, 76th Leg., ch. 771, § 4, eff. Sept. 1, 1999; Acts 2003, 78th Leg., ch. 816, § 26.017, eff. Sept. 1, 2003. § 91.016. LICENSE ISSUANCE; TERM. (a) The department shall issue a license to an applicant who the department determines has met the requirements of this chapter. The department shall notify an applicant of any deficiency in the application not later than the 30th day after the date on which the department receives the application forms. The department shall issue the license not later than the 90th day after the date on which the completed application is filed with the department. (b) A license issued or renewed by the department under this chapter is valid for one year from the date of the issuance or renewal. The department shall renew a license on receipt of a complete renewal application form and payment of the license renewal fee. (c) Each applicant or license holder shall disclose to the department the addition of a new controlling person not later than the 45th day after the date on which the person assumes the duties of a controlling person. That person may serve as a controlling person while the department is conducting any necessary investigation. If the department determines not to approve the new controlling person, the department shall notify the applicant or license holder and that controlling person at least 20 days before taking action against the applicant or license holder. Added by Acts 1995, 74th Leg., ch. 76, § 9.20(a), eff. Sept. 1, 1995. Amended by Acts 1997, 75th Leg., ch. 1379, § 9, eff. Sept. 1, 1997; Acts 2003, 78th Leg., ch. 816, § 14.004, eff. Sept. 1, 2003. § 91.017. FEES. (a) Each applicant for an original or renewal 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. (b) The commission is authorized to charge reasonable fees for license applications and renewals, investigations, inspections, and any other administrative or enforcement responsibilities created under this chapter. (c) Fees collected by the department under this chapter shall be used to implement this chapter. Added by Acts 1995, 74th Leg., ch. 76, § 9.20(a), eff. Sept. 1, 1995. Amended by Acts 1997, 75th Leg., ch. 1379, § 10, eff. Sept. 1, 1997; Acts 2003, 78th Leg., ch. 816, § 14.005, eff. Sept. 1, 2003. § 91.018. LICENSE NOT ASSIGNABLE; CHANGE OF NAME OR LOCATION. (a) A license holder may not conduct business under any name other than that specified in the license. A license issued under this chapter is not assignable. A license holder may not conduct business under any fictitious or assumed name without prior written authorization from the department. The department may not authorize the use of a name that is so similar to that of a public office or agency or to that of another license holder that the public may be confused or misled by the name's use. A license holder may not conduct business under more than one name unless the license holder has obtained a separate license for each name. (b) A license holder may change the license holder's licensed name at any time by notifying the department and paying a fee for each change of name. The commission by rule shall set the fee for a name change. A license holder may change the license holder's name on renewal of the license without the payment of the name change fee. (c) A license holder must notify the department in writing of: (1) any change in the location of the license holder's primary business office; (2) the addition of more business offices; or (3) a change in the location of business records maintained by the license holder. (d) A license holder may amend the name specified in its license to add a trade name, trademark, service mark, or parent company name. An amendment made under this subsection must comply with the requirements imposed under Subsection (a). The department may charge a fee for processing of such an amendment. (e) A license holder offering staff leasing services in more than one state may advertise in this state using the name of its parent company or under a trade name, trademark, or service mark. The trade name, trademark, service mark, or parent company name must be listed on the license in addition to the licensed name used by the license holder in this state. (f) Each written proposal provided to a prospective client company and each contract between a license holder and a client company or assigned employee shall clearly identify the name of the license holder. A proposal or contract may also identify the trade name, trademark, service mark, or parent company name of the license holder. A license holder may use written materials including forms, benefit information, letterhead, and business cards that bear only the trade name, trademark, service mark, or parent company name of the license holder. Added by Acts 1995, 74th Leg., ch. 76, § 9.20(a), eff. Sept. 1, 1995. Amended by Acts 1997, 75th Leg., ch. 1379, § 11, eff. Sept. 1, 1997; Acts 2003, 78th Leg., ch. 816, § 14.006, eff. Sept. 1, 2003. § 91.019. LIMITED LICENSE. (a) The commission by rule shall provide for the issuance of a limited license to a person who seeks to offer limited staff leasing services in this state. (b) For purposes of this section, a staff leasing services company is considered to be offering limited staff leasing services if the staff leasing services company: (1) employs fewer than 50 assigned employees in this state at any one time; (2) does not provide assigned employees to a client company based or domiciled in this state; and (3) does not maintain an office in this state or solicit client companies located or domiciled in this state. (c) A staff leasing services company that offers limited staff leasing services shall complete the application forms and pay the fees for a limited license as prescribed by the department. A limited license is valid for one year from the date of issuance and may be renewed annually on submission of a renewal application and payment of the required fees. (d) The department may use information obtained from regulatory agencies in other states in evaluating an applicant for a limited license. Added by Acts 1995, 74th Leg., ch. 76, § 9.20(a), eff. Sept. 1, 1995. Amended by Acts 1997, 75th Leg., ch. 1379, § 12, eff. Sept. 1, 1997; Acts 1999, 76th Leg., ch. 771, § 5, eff. Sept. 1, 1999; Acts 2003, 78th Leg., ch. 816, § 14.007, eff. Sept. 1, 2003. § 91.020. GROUNDS FOR DISCIPLINARY ACTION. The department may take disciplinary action against a license holder on any of the following grounds: (1) engaging in staff leasing services or offering to engage in the provision of staff leasing services without a license; (2) transferring or attempting to transfer a license issued under this chapter; (3) violating this chapter or any order or rule issued by the executive director or commission under this chapter; (4) failing after the 31st day after the date on which a felony conviction of a controlling person is final to notify the department in writing of the conviction; (5) failing to cooperate with an investigation, examination, or audit of the license holder's records conducted by the license holder's insurance company or the insurance company's designee, as allowed by the insurance contract or as authorized by law by the Texas Department of Insurance; (6) failing after the 31st day after the effective date of a change in ownership, principal business address, or the address of accounts and records to notify the department and the Texas Department of Insurance of the change; (7) failing to correct any tax filings or payment deficiencies within a reasonable time as determined by the executive director; (8) refusing, after reasonable notice, to meet reasonable health and safety requirements within the license holder's control and made known to the license holder by a federal or state agency; (9) being delinquent in the payment of the license holder's insurance premiums other than those subject to a legitimate dispute; (10) being delinquent in the payment of any employee benefit plan premiums or contributions other than those subject to a legitimate dispute; (11) knowingly making a material misrepresentation to an insurance company or to the department or other governmental agency; (12) failing to maintain the net worth requirements required under Section 91.014; or (13) using staff leasing services to avert or avoid an existing collective bargaining agreement. Added by Acts 1995, 74th Leg., ch. 76, § 9.20(a), eff. Sept. 1, 1995. Amended by Acts 1997, 75th Leg., ch. 1379, § 13, eff. Sept. 1, 1997; Acts 2003, 78th Leg., ch. 816, § 14.008, eff. Sept. 1, 2003.SUBCHAPTER C. STAFF LEASING SERVICES AGREEMENT § 91.031. AGREEMENT; NOTICE. (a) A license holder shall establish the terms of a staff leasing services agreement by a written contract between the license holder and the client company. (b) The license holder shall give written notice of the agreement as it affects assigned employees to each employee assigned to a client company worksite. (c) The written notice required by Subsection (b) must be given to each assigned employee not later than the first payday after the date on which that individual becomes an assigned employee. Added by Acts 1995, 74th Leg., ch. 76, § 9.20(a), eff. Sept. 1, 1995. Amended by Acts 1997, 75th Leg., ch. 1379, § 15, eff. Sept. 1, 1997. § 91.032. CONTRACT REQUIREMENTS. (a) A contract between a license holder and a client company must provide that the license holder: (1) shares, as provided by Subsection (b), with the client company the right of direction and control over employees assigned to a client's worksites; (2) assumes responsibility for the payment of wages to the assigned employees without regard to payments by the client to the license holder; (3) assumes responsibility for the payment of payroll taxes and collection of taxes from payroll on assigned employees; (4) shares, as provided by Subsection (b), with the client company the right to hire, fire, discipline, and reassign the assigned employees; and (5) shares, as provided by Subsection (b), with the client company the right of direction and control over the adoption of employment and safety policies and the management of workers' compensation claims, claim filings, and related procedures. (b) Notwithstanding any other provision of this chapter, a client company retains responsibility for: (1) the direction and control of assigned employees as necessary to conduct the client company's business, discharge any applicable fiduciary duty, or comply with any licensure, regulatory, or statutory requirement; (2) goods and services produced by the client company; and (3) the acts, errors, and omissions of assigned employees committed within the scope of the client company's business. (c) Notwithstanding Subsection (a)(2), a client company is solely obligated to pay any wages for which: (1) obligation to pay is created by an agreement, contract, plan, or policy between the client company and the assigned employee; and (2) the staff leasing services company has not contracted to pay. (d) Each staff leasing services company shall disclose the requirements of Subsection (c) in writing to each assigned employee. Added by Acts 1995, 74th Leg., ch. 76, § 9.20(a), eff. Sept. 1, 1995. Amended by Acts 1999, 76th Leg., ch. 771, § 7, eff. Sept. 1, 1999; Acts 2003, 78th Leg., ch. 833, § 2, eff. Sept. 1, 2003.SUBCHAPTER D. POWERS AND DUTIES OF LICENSE HOLDER § 91.041. EMPLOYEE BENEFIT PLANS; REQUIRED DISCLOSURE; OTHER REPORTS. (a) A license holder may sponsor and maintain employee benefit plans for the benefit of assigned employees. A client company may include assigned employees in any benefit plan sponsored by the client company. (b) With respect to any insurance or benefit plan provided by a license holder for the benefit of its assigned employees, a license holder shall disclose the following information to the department, each client company, and its assigned employees: (1) the type of coverage; (2) the identity of each insurer for each type of coverage; (3) the amount of benefits provided for each type of coverage and to whom or in whose behalf benefits are to be paid; (4) the policy limits on each insurance policy; and (5) whether the coverage is fully insured, partially insured, or fully self-funded. (c) The commission by rule may require a license holder to file other reports that are reasonably necessary for the implementation of this chapter. Added by Acts 1995, 74th Leg., ch. 76, § 9.20(a), eff. Sept. 1, 1995. Amended by Acts 1997, 75th Leg., ch. 1379, § 16, eff. Sept. 1, 1997; Acts 2003, 78th Leg., ch. 816, § 14.009, eff. Sept. 1, 2003. § 91.042. WORKERS' COMPENSATION INSURANCE. (a) A license holder may elect to obtain workers' compensation insurance coverage for 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. (b) If a license holder maintains workers' compensation insurance, the license holder shall pay workers' compensation insurance premiums based on the experience rating of the client company for the first two years the 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 a license holder elects to obtain workers' compensation insurance, the client company and the license holder are subject to Sections 406.034 and 408.001. (d) If a license holder does not elect to obtain workers' compensation insurance, both the license holder and the client company are subject to Sections 406.004 and 406.033. (e) After the expiration of the two-year period under Subsection (b), if the client company obtains a new workers' compensation insurance 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 policy of the company shall be based on the lower of: (1) the experience modifier of the company before entering into the staff leasing arrangement; or (2) the experience modifier of the license holder at the time the staff leasing arrangement terminated. (f) On request, 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). Added by Acts 1995, 74th Leg., ch. 76, § 9.20(a), eff. Sept. 1, 1995. § 91.043. HEALTH BENEFIT PLANS. (a) A license holder may not sponsor a plan of self-insurance for health benefits except as permitted by the Employee Retirement Income Security Act of 1974 (29 U.S.C. Section 1001 et seq.). (b) For purposes of this section, a "plan of self-insurance" includes any arrangement except an arrangement under which an insurance carrier authorized to do business in this state has issued an insurance policy that covers all of the obligations of the health benefits plan. Added by Acts 1995, 74th Leg., ch. 76, § 9.20(a), eff. Sept. 1, 1995. § 91.044. UNEMPLOYMENT TAXES; PAYROLL. (a) A license holder is the employer of an assigned employee for purposes of Subtitle A, Title 4, and, except for wages subject to Section 91.032(c), for purposes of Chapter 61. In addition to any other reports required to be filed by law, a license holder shall report quarterly to the Texas Workforce Commission on a form prescribed by the Texas Workforce Commission the name, address, telephone number, federal income tax identification number, and classification code as described in the "Standard Industrial Classification Manual" published by the United States Office of Management and Budget of each client company. (b) For purposes of Subtitle A, Title 4, in the event of the termination of a contract between a license holder and a client company or the failure by a staff leasing entity to submit reports or make tax payments as required by that subtitle, the contracting client company shall be treated as a new employer without a previous experience record unless that client company is otherwise eligible for an experience rating. Added by Acts 1995, 74th Leg., ch. 76, § 9.20(a), eff. Sept. 1, 1995. Amended by Acts 1997, 75th Leg., ch. 1379, § 17, eff. Sept. 1, 1997; Acts 2003, 78th Leg., ch. 833, § 3, eff. Sept. 1, 2003. § 91.045. POSTING REQUIREMENTS. (a) Each license holder shall post in a conspicuous place in the license holder's principal place of business in this state the license issued under this chapter. (b) Each license holder shall display, in a place that is in clear and unobstructed public view, a notice stating that the business operated at the location is licensed and regulated by the department and that any questions or complaints should be directed to the department. Added by Acts 1995, 74th Leg., ch. 76, § 9.20(a), eff. Sept. 1, 1995. § 91.046. CONTRACTUAL DUTIES. Each license holder is responsible for the license holder's contractual duties and responsibilities to manage, maintain, collect, and make timely payments for: (1) insurance premiums; (2) benefit and welfare plans; (3) other employee withholding; and (4) any other expressed responsibility within the scope of the contract for fulfilling the duties imposed under this section and Sections 91.032, 91.047, and 91.048. Added by Acts 1995, 74th Leg., ch. 76, § 9.20(a), eff. Sept. 1, 1995. § 91.047. COMPLIANCE WITH OTHER LAWS. Each license holder shall comply with all appropriate state and federal laws relating to reporting, sponsoring, filing, and maintaining benefit and welfare plans. Added by Acts 1995, 74th Leg., ch. 76, § 9.20(a), eff. Sept. 1, 1995. § 91.048. REQUIRED INFORMATION. Each license holder shall: (1) maintain adequate books and records regarding the license holder's duties and responsibilities; (2) maintain and make available at all times to the executive director the following information, which shall be treated as proprietary and confidential and is exempt from disclosure to persons other than other governmental agencies having a reasonable, legitimate purpose for obtaining the information: (A) the correct name, address, and telephone number of each client company; (B) each client company contract; and (C) a listing by classification code as described in the "Standard Industrial Classification Manual" published by the United States Office of Management and Budget, of each client company; (3) notify the department of any addition or deletion of a controlling person as listed on the license application or renewal form by providing the name of the person not later than the 45th day after the date on which the person is added or deleted as a controlling person; and (4) provide a biographical history to the department in connection with the addition of a new controlling person. Added by Acts 1995, 74th Leg., ch. 76, § 9.20(a), eff. Sept. 1, 1995. Amended by Acts 1997, 75th Leg., ch. 1379, § 18, eff. Sept. 1, 1997; Acts 2003, 78th Leg., ch. 816, § 26.018, eff. Sept. 1, 2003. § 91.049. AGENT FOR SERVICE OF PROCESS. Each license holder shall maintain a registered agent for the service of process in this state. Added by Acts 1995, 74th Leg., ch. 76, § 9.20(a), eff. Sept. 1, 1995.SUBCHAPTER E. PROHIBITED ACTS; PENALTY § 91.061. PROHIBITED ACTS. A person may not: (1) engage in or offer staff leasing services without holding a license under this chapter as a staff leasing services company; (2) use the name or title "staff leasing company," "employee leasing company," "licensed staff leasing company," "staff leasing services company," "professional employer organization," or "administrative employer" or otherwise represent that the entity is licensed under this chapter unless the entity holds a license issued under this chapter; (3) represent as the person's own the license of another person or represent that a person is licensed if the person does not hold a license; (4) give materially false or forged evidence to the department in connection with obtaining or renewing a license or in connection with disciplinary proceedings under this chapter; or (5) use or attempt to use a license that has expired or been revoked. Added by Acts 1995, 74th Leg., ch. 76, § 9.20(a), eff. Sept. 1, 1995. Amended by Acts 1997, 75th Leg., ch. 1379, § 19, eff. Sept. 1, 1997. § 91.062. ACTION BY ATTORNEY GENERAL. (a) The executive director may notify the attorney general of a violation of this chapter. The attorney general may apply to a district court in Travis County for permission to file for quo warranto relief, injunctive relief, or both. (b) The attorney general may not be required to post a bond for injunctive relief under this section. Added by Acts 1995, 74th Leg., ch. 76, § 9.20(a), eff. Sept. 1, 1995. Amended by Acts 2003, 78th Leg., ch. 816, § 26.019, eff. Sept. 1, 2003. § 91.063. CRIMINAL PENALTY. (a) A person who violates Section 91.061 commits an offense. (b) An offense under this section is a Class A misdemeanor. Added by Acts 1995, 74th Leg., ch. 76, § 9.20(a), eff. Sept. 1, 1995.
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