81R4258 PB-D
By: Giddings H.B. No. 520
A BILL TO BE ENTITLED
AN ACT
relating to workers' compensation insurance coverage under certain
agreements and to liability of third parties for an injury to an
employee.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 406.121, Labor Code, is amended by
amending Subdivision (1) and adding Subdivision (4-a) to read as
follows:
(1) "General contractor" means a person who undertakes
to procure the performance of work or a service for the benefit of
another, either separately or through the use of subcontractors.
The term includes a "principal contractor," "original contractor,"
"prime contractor," or other analogous term. The term does not
include:
(A) a motor carrier that provides a
transportation service through the use of an owner operator; or
(B) a principal who enters into an agreement with
a general contractor for the performance of work or the provision of
a service.
(4-a) "Principal" means a person who enters into a
contract or other agreement with a general contractor for the
benefit of the person for the performance of work or a service in
accordance with the terms of the contract or agreement. In the
context of an agreement regarding the performance of work or a
service on the premises of the person contracting with the general
contractor, the term includes a premises owner.
SECTION 2. Subchapter F, Chapter 406, Labor Code, is
amended by adding Section 406.128 to read as follows:
Sec. 406.128. LIABILITY OF PRINCIPAL. (a) A principal who
enters into a contract or other agreement with a general contractor
for the performance of work or a service for the benefit of the
principal does not, by virtue of that contract or agreement, become
an employer of the employees of the general contractor or any
subcontractor of the general contractor for purposes of Section
408.001.
(b) A principal may be liable under Chapter 417 for damages
for an injury or death that:
(1) is compensable under this subtitle; and
(2) occurs on the premises of the principal.
SECTION 3. Section 417.001(a), Labor Code, is amended to
read as follows:
(a) An employee or legal beneficiary may seek damages from a
third party who is or becomes liable to pay damages for an injury or
death that is compensable under this subtitle and may also pursue a
claim for workers' compensation benefits under this subtitle. For
purposes of this subsection, a third party may include a principal,
as that term is defined by Section 406.121, if the compensable
injury or death occurs on the premises of the principal.
SECTION 4. This Act takes effect immediately if it receives
a vote of two-thirds of all the members elected to each house, as
provided by Section 39, Article III, Texas Constitution. If this
Act does not receive the vote necessary for immediate effect, this
Act takes effect September 1, 2009.