Texas 2009 - 81st Regular

Texas Senate Bill SB1427 Compare Versions

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1	1	By: Williams S.B. No. 1427
2	2	(In the Senate - Filed March 6, 2009; March 17, 2009, read
3	3	first time and referred to Committee on Business and Commerce;
4	4	April 14, 2009, reported adversely, with favorable Committee
5	5	Substitute by the following vote: Yeas 9, Nays 0; April 14, 2009,
6	6	sent to printer.)
7	7	COMMITTEE SUBSTITUTE FOR S.B. No. 1427 By: Eltife
8	8
9	9
10	10	A BILL TO BE ENTITLED
11	11	AN ACT
12	12	relating to the regulation of staff leasing services.
13	13	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
14	14	SECTION 1. Section 91.001, Labor Code, is amended by adding
15	15	Subdivisions (2-a) and (18) to read as follows:
16	16	(2-a) "Assurance organization" means an independent
17	17	entity approved by the commission that:
18	18	(A) provides a national program of accreditation
19	19	and financial assurance for staff leasing services companies;
20	20	(B) has documented qualifications, standards,
21	21	and procedures acceptable to the department; and
22	22	(C) agrees to provide information, compliance
23	23	monitoring services, and financial assurance useful to the
24	24	department in accomplishing the provisions of this chapter.
25	25	(18) "Working capital" of an applicant means the
26	26	applicant's current assets minus the applicant's current
27	27	liabilities as determined by generally accepted accounting
28	28	principles.
29	29	SECTION 2. Section 91.014, Labor Code, is amended to read as
30	30	follows:
31	31	Sec. 91.014. WORKING CAPITAL [NET WORTH] REQUIREMENTS.
32	32	(a) An applicant for an original or renewal license must
33	33	demonstrate positive working capital in the following amounts [a
34	34	net worth as follows]:
35	35	(1) $50,000 if the applicant employs fewer than 250
36	36	assigned employees;
37	37	(2) $75,000 if the applicant employs at least 250 but
38	38	not more than 750 assigned employees; and
39	39	(3) $100,000 if the applicant employs more than 750
40	40	assigned employees.
41	41	(b) The applicant shall [may] demonstrate the applicant's
42	42	working capital [net worth] to the department by providing the
43	43	department with the applicant's financial statement [or a copy of
44	44	the applicant's most recent federal tax return]. The financial
45	45	statement must be prepared in accordance with generally accepted
46	46	accounting principles, be audited by an independent certified
47	47	public accountant, and be without qualification as to the going
48	48	concern status of the applicant. An applicant that has not had
49	49	sufficient operating history to have audited financial statements
50	50	based on at least 12 months of operations must meet the financial
51	51	capacity requirements required by Subsection (a) and provide the
52	52	department with financial statements that have been reviewed by a
53	53	certified public accountant. The applicant may [also] satisfy
54	54	any deficiencies in the working capital [the net worth] requirement
55	55	through guarantees, letters of credit, a bond in an amount that
56	56	demonstrates compliance with the amounts required under
57	57	[requirements of] Subsection (a), or other security acceptable to
58	58	the department. A guaranty is not acceptable to satisfy this
59	59	subsection unless the applicant submits sufficient evidence to
60	60	satisfy the department that the guarantor has adequate resources to
61	61	satisfy the obligations of the guaranty.
62	62	(c) [In computing net worth, an applicant shall include
63	63	adequate reserves for all taxes and insurance, including reserves
64	64	for claims incurred but not paid and for claims incurred but not
65	65	reported under plans of self-insurance for health benefits. The
66	66	computation of net worth by an applicant is to be made according to
67	67	Section 448, Internal Revenue Code (26 U.S.C. Section 448).
68	68	[(d) A document submitted to establish net worth must show
69	69	the net worth on a date not earlier than nine months before the date
70	70	on which the application is submitted. A document submitted to
71	71	establish net worth must be prepared or certified by an independent
72	72	certified public accountant.] Information submitted to or
73	73	maintained by the department is subject to Chapter 552, Government
74	74	Code, other than information related to:
75	75	(1) identification of client companies;
76	76	(2) working capital [net worth];
77	77	(3) financial statements; or
78	78	(4) federal tax returns.
79	79	SECTION 3. Section 91.020, Labor Code, is amended to read as
80	80	follows:
81	81	Sec. 91.020. GROUNDS FOR DISCIPLINARY ACTION. The
82	82	department may take disciplinary action against a license holder on
83	83	any of the following grounds:
84	84	(1) engaging in staff leasing services or offering to
85	85	engage in the provision of staff leasing services without a
86	86	license;
87	87	(2) transferring or attempting to transfer a license
88	88	issued under this chapter;
89	89	(3) violating this chapter or any order or rule issued
90	90	by the executive director or commission under this chapter;
91	91	(4) failing after the 31st day after the date on which
92	92	a felony conviction of a controlling person is final to notify the
93	93	department in writing of the conviction;
94	94	(5) failing to cooperate with an investigation,
95	95	examination, or audit of the license holder's records conducted by
96	96	the license holder's insurance company or the insurance company's
97	97	designee, as allowed by the insurance contract or as authorized by
98	98	law by the Texas Department of Insurance;
99	99	(6) failing after the 31st day after the effective
100	100	date of a change in ownership, principal business address, or the
101	101	address of accounts and records to notify the department and the
102	102	Texas Department of Insurance of the change;
103	103	(7) failing to correct any tax filings or payment
104	104	deficiencies within a reasonable time as determined by the
105	105	executive director;
106	106	(8) refusing, after reasonable notice, to meet
107	107	reasonable health and safety requirements within the license
108	108	holder's control and made known to the license holder by a federal
109	109	or state agency;
110	110	(9) being delinquent in the payment of the license
111	111	holder's insurance premiums other than those subject to a
112	112	legitimate dispute;
113	113	(10) being delinquent in the payment of any employee
114	114	benefit plan premiums or contributions other than those subject to
115	115	a legitimate dispute;
116	116	(11) knowingly making a material misrepresentation to
117	117	an insurance company or to the department or other governmental
118	118	agency;
119	119	(12) failing to maintain the working capital [net
120	120	worth requirements] required under Section 91.014; or
121	121	(13) using staff leasing services to avert or avoid an
122	122	existing collective bargaining agreement.
123	123	SECTION 4. Subchapter B, Chapter 91, Labor Code, is amended
124	124	by adding Section 91.021 to read as follows:
125	125	Sec. 91.021. ELECTRONIC FILING AND COMPLIANCE. (a) The
126	126	commission may adopt rules to permit the acceptance of electronic
127	127	filings under this chapter, including the filing of applications,
128	128	documents, reports, and other documents required by this chapter.
129	129	The rules may provide for the acceptance of electronic filing and
130	130	other assurance by an assurance organization, qualified and
131	131	approved by the commission, that provides satisfactory assurance
132	132	and documentation of compliance acceptable to the department that
133	133	meets or exceeds the requirements of this chapter.
134	134	(b) A staff leasing services company may authorize an
135	135	assurance organization that is qualified and approved by the
136	136	commission to act on its behalf in complying with the licensing
137	137	requirements of this chapter, including the electronic filing of
138	138	information and the payment of application and licensing fees. Use
139	139	of an assurance organization is optional and is not mandatory for a
140	140	staff leasing services company.
141	141	(c) Nothing in this section may be construed to change or
142	142	affect the department's authority to issue licenses, revoke
143	143	licenses, conduct investigations, or enforce any provision of this
144	144	chapter.
145	145	SECTION 5. Subchapter D, Chapter 91, Labor Code, is amended
146	146	by adding Section 91.050 to read as follows:
147	147	Sec. 91.050. TAX CREDITS AND OTHER INCENTIVES. (a) For
148	148	the purpose of determining tax credits, grants, and other economic
149	149	incentives provided by this state or other governmental entities
150	150	that are based on employment, assigned employees are considered
151	151	employees of the client, and the client is solely entitled to the
152	152	benefit of any tax credit, economic incentive, or other benefit
153	153	arising from the employment of assigned employees of the client.
154	154	This subsection applies even if the staff leasing services company
155	155	is the reporting employer for federal income tax purposes.
156	156	(b) If a grant or the amount of any incentive described by
157	157	Subsection (a) is based on the number of employees, each client
158	158	shall be treated as employing only those assigned employees
159	159	co-employed by the client. Assigned employees working for other
160	160	clients of the staff leasing services company may not be included in
161	161	the computation.
162	162	(c) Each staff leasing services company shall provide, on
163	163	the request of a client or an agency of this state, employment
164	164	information reasonably required by the state agency responsible for
165	165	the administration of any tax credit or economic incentive
166	166	described by Subsection (a) and necessary to support a request,
167	167	claim, application, or other action by a client seeking the tax
168	168	credit or economic incentive.
169	169	SECTION 6. Subdivision (12), Section 91.001, Labor Code, is
170	170	repealed.
171	171	SECTION 7. The changes in law made by this Act regarding the
172	172	qualifications for or the issuance or renewal of a license apply to
173	173	a staff leasing services license issued or renewed under Chapter
174	174	91, Labor Code, on or after December 31, 2010. A license issued or
175	175	renewed before December 31, 2010, is governed by the law as it
176	176	existed immediately before that date, and that law is continued in
177	177	effect for that purpose.
178	178	SECTION 8. (a) Except as provided by Subsection (b) of
179	179	this section, this Act takes effect September 1, 2009.
180	180	(b) Section 91.014, Labor Code, as amended by this Act,
181	181	takes effect December 31, 2011.
182	182	* * * * *