Workers' Compensation Law Summaries
Texas, Workers' Compensation Law Summaries
Texas' workers' compensation law is located in the Texas Statutes and Codes, Labor Code at Title 5, Subtitle A.
COVERAGE
Except for public employers, employers may elect coverage (Sec. 406.002). Covered employment can include any employee in the service of another under any contract of hire-express or implied, oral or written (Sec. 406.012). It includes persons who are engaged in construction, remodeling or repair work at the employer's premises, except for independent contractors and their employees. General contractors may assume responsibility for coverage of subcontractors and their employees by written contract (Sec. 406.163).
Coverage may include employees who are directed by the employer to temporarily perform services outside the usual course and scope of the employer's business (Sec. 401.012(b)(1)). Farm or ranch employees may be covered if they are migrant workers, seasonal workers or employed by a person with a gross annual payroll of $25,000 or more and who employs three or more farm or ranch employees other than migrant or seasonal workers (Sec. 406.162). Public employers that self-insure, either individually or collectively, are considered employers under the workers' compensation law (Sec. 401.011).
A government entity entering a building or construction contract must require the contractor to provide workers' compensation insurance coverage (Sec. 406.096).
A general contractor and a subcontractor may agree in writing that the general contractor provides workers' compensation insurance coverage for the subcontractor (Sec. 406.123). A hiring contractor and an independent contractor may agree in writing that the hiring contractor may withhold the cost of workers' compensation coverage (Sec. 406.144) or they may agree the subcontractor remains an independent contractor and not an employee (Sec. 406.145).
Case law.- Texas public policy does not prohibit coverage, under workers' compensation and employment liability insurance policies, of punitive damages imposed on an employer due to gross negligence, the state's high court ruled, in the case of a machine operator for a highway paving company who died as a result of injuries sustained when the machine rolled over. The employer's insurance company sought a declaratory judgment that it owed no duty to defend or indemnify the employer, if found liable for gross negligence. Texas workers' compensation law does not prohibit recovery of exemplary damages if an employee's death is caused by an employer's gross negligence; nor does Texas public policy prohibit insurance coverage for such claims. “Were the existence of insurance coverage to completely eviscerate the punitive purpose behind awarding exemplary damages, it could defeat not only an explicit legislative policy but also the court's traditional role in deterring conscious indifference,” the court wrote (Fairfield Insurance Co v Stephens Martin Paving, LP , TexSCt, February 15, 2008).
In a revised decision following a rare rehearing, the Texas Supreme Court reaffirmed an earlier holding that Entergy Gulf State, as a general contractor that provides workers' compensation insurance to a subcontractor, was protected from negligence claims brought when a subcontractor's employee was injured while working at one of Entergy's plants. The state high court's unanimous 2007 decision, which ruled that a premises owner could be a general contractor and, therefore, enjoy the exclusive remedy provisions, in essence created a "statutory employer." Although the Texas Workers' Compensation Act specifically confers statutory employer status on general contractors who qualify by providing workers' comp insurance for their subcontractors' employees, it says nothing about whether premises owners who act as their own general contractor are also entitled to employer status. In its revised decision, a now-divided high court ruled 6-3 that by taking out a workers' compensation policy for the entire worksite, Entergy did the very thing the Texas legislature had long tried to encourage. Whether a premises owner, general contractor, prime contractor, or subcontractor, Entergy is a subscriber of a workers' compensation policy and therefore satisfies the legislature's intent to ensure consistent and reliable coverage to all employees, the court concluded. H.B. 1657, a bill already introduced to overturn the court's ruling, has cleared a House committee. Insurance groups have vowed to fight the measure (Entergy v Summers , TexSCt, April 3, 2009).
EXCEPTIONS
Excluded from the definition of employees are masters of or sailors on vessels engaged in interstate or foreign commerce, persons whose employment is not in the usual course and scope of the employer's business, independent contractors, domestic and casual workers engaged in employment incidental to a personal residence, federal employees, farm or ranch employees (Sec. 406.126) not specifically included and professional athletes. Volunteer emergency services members and personnel who participate in the normal functions of an emergency service organization that is not a political subdivision or that is separate from any political subdivision and sole proprietors, partners or corporate officers who are specifically excluded through an endorsement to a workers' compensation insurance policy or certificate of authority to self-insure may be excluded from coverage (Secs. 401.012, 406.091 and 406.121).
Generally, employers may elect coverage of employees who are otherwise exempted (Sec. 406.001).
An owner operator and its employees are not employees of the motor carrier if the owner operator has a written agreement with a motor carrier evidencing that the owner operator has assumed the responsibilities of an employer (Sec. 406.122).
WHAT THE EMPLOYER MUST DO
Insurance choices.- Employers may insure with the state fund, a private insurance company or through self-insurance (or group self-insurance) (Sec. 406.003).
Waiting period.- Weekly income benefits may not be paid for an injury that does not result in disability for a period of at least one week. If a disability lasts beyond one week, weekly income benefits begin to accrue on the eighth day after an injury (this does not affect recovery of medical expenses).
If disability does not follow at once after the injury or within eight days of the occurrence but does occur subsequently, weekly income benefits begin to accrue on the eighth day after the date the disability begins. If a disability continues for two weeks or longer, compensation is computed from the beginning of the disability (Sec. 408.082).
Choice of physician.- The employee must choose the initial treating physician from a list approved by the workers' compensation commission, except in an emergency. If the employee is dissatisfied with the initial choice, he or she may notify the commission in writing (by telephone in an emergency), stating why an alternate physician is being requested (Sec. 408.023(a)).
Reports and records.- An employer must report to the insurance carrier an injury resulting in an employee absence from work of more than one day (Secs. 409.005 and 411.032).. An employer must maintain and file a record of each employee injury reported by an employee (Sec. 409.006).
Drug and alcohol use.- An injury or accident is not compensable if it is due to the employee's intoxication (Sec. 406.032). Intoxication has a specific meaning under the law (Sec. 401.013).
Intoxication does not include the loss of normal use of mental or physical faculties resulting from the introduction into the body of a substance that is taken under and in accordance with a prescription written for the employee by the employee's doctor or by inhalation or absorption incidental to the employee's work (Secs. 401.013 and 406.032).
NOTICE
An employer that does not obtain workers' compensation insurance coverage must provide written notice to the division of workers' compensation (Sec. 406.004).
Notice must be given by an employee to an employer within 30 days of an injury; failure of notice is excusable (Secs. 409.001 and 409.002).
An employer must notify employees at the time of hiring whether the employer has coverage. The employer must notify employees if coverage is terminated or cancelled (Sec. 406.005). The employer must also notify the division of coverage termination (Sec. 406.007).
An insurer must notify the employee and the division of its refusal to pay benefits and the reason for denying the benefits (Secs. 409.021 and 409.022). The carrier must also file with the division a notice of termination or reduction of benefits (Sec. 409.024).
POSTING
Each employer must post a notice stating whether the employer has workers' compensation insurance coverage, at conspicuous locations at its place of business as necessary to provide reasonable notice to the employees. The notice must be revised when the information contained in it is changed (Sec. 406.005).
See also ¶45-9900 .
PENALTIES
Penalties for administrative violations range from 500 to $10,000 (Sec. 415.022). Except as otherwise provided, no administrative penalty may exceed $25,000 per day per occurrence (Sec. 415.025).
Civil penalties may not exceed $5,000 for each violation (Sec. 419.004).
CONTACTS
Division of Workers' Compensation, 7551 Metro Center Drive, Suite 100, Austin, TX 70744, (512) 804-4000.
<p>Division of Workers' Compensation, 7551 Metro Center Drive, Suite 100, Austin, TX 70744, (512) 804-4000.</p>