3 New HR laws for Texas Employers – A Quick Peek

One nice thing about the Texas Legislature is that it meets only every other year.  (If only Congress would follow that model.)  Despite this biennial schedule, Texas lawmakers found time to enact three laws this year directly affecting employers and which will go into effect in just a couple weeks, on September 1. 

Here’s what’s new.

 “Don’t mess with Texas interns!”

In HB 1151, Texas has said keep your hands off the interns.  This new law amends Chapter 21 of the Labor Code to include unpaid interns as a protected class of individuals who should be free from sexual harassment.  According to the analysis of the bill, the impetus for this law was a court decision in another state that held an intern could not sue a company for sexual harassment because she technically was not an “employee.”  The new law defines sexual harassment consistent with existing law and further defines interns based on the current understanding of common internship practices.  This law makes sense.  Bravo, Texas.           

Atten-hut!  No military posers should report for duty.

Texas passed the “Stolen Valor Act” in SB 664, as a salute to the sanctity of military service.  Since 2011, Texas has classified as a misdemeanor certain conduct where a person falsely represents a military record to obtain benefits or services from the State.  Expanding this rationale into the workplace, Texas will now permit employers to terminate employees who likewise misrepresented their military record to obtain employment or employment-related benefits – even if the employee has an employment agreement. 

Under the law, an employer must have a reasonable basis for concluding that the employee misrepresented his military service.  That’s a no brainer.  And the new law also grants the employee the right to sue in state court for wrongful termination for violating the law, providing as remedies reinstatement, lost wages and benefits, but not attorney’s fees.  (Good luck finding someone to take on that case if attorney’s fees are not recoverable.)

Thank you, vets, for your service.  And thank you, Texas, for recognizing that service.

Hey, franchisors, you deserve a break today!

The NLRB lately has caused more angst and uncertainty in the workplace, going after franchisors and claiming that their franchisees’ employees really are the franchisors’ employees, too.  Why?  Well, duh, to make it easier for unions to organize employees.

Under SB 652, Texas has thumbed its nose at the NLRB.  This new law, according to the drafters’ stated intent, clarifies that “under Texas law, a franchisor is not the employer of a franchisee's employees for the following purposes: employment discrimination law, wage and hour law, minimum wage law, professional employer organization law, unemployment law, workers compensation law, and workplace safety law.”   

And what does the law do?  It basically states that unless a court (read: not a mere agency) finds a franchisor to have exercised the degree of control over a franchisee’s employees necessary to make them employees of the franchisor, there is no employment relationship with the franchisor.

This new law unfortunately does not insulate employers from the NLRB and its latest efforts to hold franchisors as joint employers with franchisees, since the NLRA would likely preempt contrary state law.  But the scope of Texas’ new law draws a bright line between a franchisor and franchisee as far as liability under several Texas labor laws is concerned. 

And that’s a Happy Meal prize if I ever saw one. 

Give these laws a quick look, and maybe you’ll find them helpful.  Good luck.


Chris Bourgeacq practices labor & employment law in Texas and wherever his clients need him.  You can contact him at Chris@cbqlaw.com or check out his website at cbqlaw.com.  Follow Chris on Twitter @CBQlaw.