Untitled Texas Attorney General Opinion ( 1958 )

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July 8, 1958
Honorable 0. L. Sticfcr Opinion No. WW-471
Acting Commissioner
Bureau of Labor Statistics Re: The legality of a
Capitol Station “search fee” being
Austin, Texas collected by licensed
employment agencies
prfo? to the appll-
cant obtaining and
Dear Mr. Stiefer: accepting employment.
The late Mr. M. B. Morgan, former Commissioner of the
Bureau. of Labor Statistics, requested an opi,nlon from this
office on May 30, 1958. His request read, in part, as follows:
. . .whether
,I
a Q.earch feel
being collected by a licensed employment
agency from the applicant for placing
his Iresumef with the Executive Index,
Inc., a national organization, one half
of such fee to be retained by the licensed
agency, the other half sent to the Execu-
tive Index, Inc., would amount to a
registration fee and be in vlolatfon of
Art. 522la-6, R.C.S., which prohibits a
fee to be collected before employment has
teen obtained and accepted by the appli-
cant.”
He then outlined the plan of operation which prompted
his request. Essentially it is that licensed employment
agencies in Texas propose becoming members of an out of state
cooperative placement organization which operates on a natfon-
wide basis.
Working under a franchise agreement with the national
concern, and in an exclusive territory designated by it, the
licensed agent sends such organization resumes of selected
‘applicants, as well as job orders. The home office of the
ccoperative group then compares this data with similar data
received from other agencies over the nation, in an effort to
secure employment for the applicant.
In order to secure this service the applicant is charged
Honorable 0. L. Stiefer, Page 2 (WW-471)
a “search fee” ranging from $15.00 to $30.00 depending upon the
salary range requested by the applicant. The licensed agency
retains one half of this fee and remits the other one half to
the parent organization.
The applicant must pay the fee prior to obtaining and
accepting employment. Following employment, if secured by
this cooperative method, the agency and the national office
share the placement commission.
House Bill 387, Acts Slst Legislature, Regular Session,
1949, Chapter 24.5, Page 453, (codified as Article 52218-6,
Vernon’s Civil Statutes), defines private employment agents
10) agencies, in Section 1 (e), as follows:
“1Private Employment Agent.1 means
any person in this State who for a fee
or without a fee offers or attempts to
procure employment for employees or pro-
cure or attempts to procure employees
for employers except employees as common
laborers or agricultural workers.”
Section 1 (b) of the Article defines the term “fee” as
f0llows: - ^
“IFeet means anything of value
In~zluding money or other valuable con-
si:jeration or services or the promise
~;i any of the foregoing received by an
ea:p:oyment agency from or on behalf of
an?’ person seeking employment or em-
o?cyees in payment for any ser,vice,
-it;t:er dire.ctly or indirectly.”
ine authority fcr private employment agents or agencies
tc: ,:h;::ge t’ees for their services is provided in Section 8 of
Artic:!e 5221a-6. It reads as follows:
!‘Sec. 8. Private Employment
Agents or Agencies as defined by this
A;:‘, a!:.d who are engaged in the business
bf attempting to procure employment for
employees or procures or attempts to
procure employees for employers in
skilled, professional, or clerical
positions-ma char e -with the written
consent of-&Z&L&ant a fee, not to
exceed forty per cent (4%) of the first
Honorable 0. L. Stiefer, Page 3 (WW-471)
month’s salary, which may be collected
from the aoolicant only after employment
has been obtained and accepted by the
``~:iCoap``~,njemphasis added throughout
The statute is free from ambiguities. The only fee
wh lch a licensed employment agent or agency is authorized
to charge and collect from a Job applicant is 40% of the
first month’s salary as set forth in Section 8 above.
Attorney General’s Opinion O-6879 (1945) spoke
regarding the legality of certain fees being charged by
certain employment agencies in Texas. That opinion was
written in reply to a request submitted to this office by
the then Commissioner of your department. Three of the
questions directed to the Attorney General in that request
are directly related to the problem here. They are as
follows:
“a. It has been called to our
attention that certain employment agencies
ln this State charge a registration fee,
that is, when an applicant desires to be
placed on the agency’s available list the
applicant pays said agency a fee reg‘ardless
as to whether or not employment is ever
given him or her. Is this permitted by the
statutes?
“b. Other agencies charge a flat
z.:nthIy registration fee such as either
$L.i30 cr $2.00 a month, this sum to be
;aId by the applicant regardless of
whether or not employment is obtained,
and upon the refusal or failure of the
applicant to pay said registration fee his
name is withdrawn from the list of avall-
able employees. Is this permissible under
t?.e Texas statutes?
“C. Some agencies, while charging
a flat registration fee of either $2.00 or
,$3.00, then upon obtaining and acceptance
of employment of the applicant deduct that
from the authorized 30 per cent commission.
Is this practice permissible under our
statutes?
I,. . . 11
Honorable 0. L. Stiefer, Page 4 (WW-471)
At the writing of that opinion the employment agencies
were operating under the Texas Employment and Labor Agency
Law which was House Bill 264, enacted by the 48th Legislature,
Regular Session, Acts of 1943, Chapter 67, Page 86, and codified
as Article 5221a-f+, Vernon’s Civil Statutes, 1925, as amended.
Section 11 of that Article-authorized the agencies to charge fees
as follows:
“Sec. 11. . . . emolovment or labor
This office held, in that opinion, that the fees
authorized by Section 11:
“. . are to be paid by the
applicant or’employee only after the
employment has been obtained and
accepted by the applicant. Any fee
or charges made to or paid by the
applicant prior to this event is con-
trary to and ;s an attempt to circwivent
the statute. . . 0’t
T,o Att@rney Generalrs Opinion R-257: (1951) the question
4.~7trt tYt amount of the fee to be charged in connection with
:5-,3rri,r~;~ 3 beer dealers permit was answered. The statute,
(Art. 667-5 (C) V.P.C,), provfdad that each applicant for a
:.i?xer 117t?.E;e ‘IO o . shall be subject to a fee of five ($5.00)
z:iZ She applicant shall be liable for no other fees
oolication fee and the annual license fee required
It was held, in that opinion:
II that $5.00 is the only fee
that may’bi ihar#ed an applicant for a
beer permit. . .
Statutes which fix fees are to be strictly construed,
The Court, in Maore v. Sheppard, 144 Tex. 537, 192 S.W.2d
559 (citing McLennan County v. Beggess, 104 Tex. 311, 137
S.W. 346) sa>d:
“That the fixing of official
Honorable 0. L. Stiefer, Page 5 (WW-471)
fees is a matter of gentrrl legislatien,
and is a rsubJectr of general legislation
within the meaning of Articl6 III, Saction
3.5, above, cannot be qutstiened. There
are many such enactments in our statutes.
These statutes have b66n Strictly CQn-
strued against allowing a f6e by implicatiOna
as regards both the fixing of th6 f66, and
the officer entitled thereto.”
In State v. Moore, 57 Tax. 307, Mr. JustiC6 Stayten
said:
“It is not believed that any
well considtred case can be found in
which a public officer has bean permitt6d
to collect fees unless the same are
provided for, and the amount thereof
declared by law.”
It is a basicrule of law thet statutes should b6 60
construed as to carry out the legislative intmt and once
such intent. is ascertained it should b6 given full 6ffeCt.
Wood v. State, 133 Tex. 110, 126 S.W.2d 4; Simmans 6t al. V.
Arnim et - al., 110 Tex. 309, 220 S.W.66.
The Court p in Gaddy v. First National Bank of Beaumont,
115 Tcx. 393, 283 Sod. 472 said:
“In this case9 we think the act
itseif is entirely c?ae~s. Where this
is true, from the ver;; lmguage employed,
it is not necessary n:’ proper to add or
to subtract from the statute.”
Clearly the intent of the Legislature was to authorize
private employment agencies to charge a placement fee not to
exceed forty (40) per centum of the applicantrs first month’s
salary. No other fee of any sort is authorized by the statute
a.nd under no conditions can the authorized fee or any other fee,
be charged prior to the applicant’s ebtaining and accepting
employment.
In the instant case the “search fee” is charged the
applicant prier to his ebtaining~and accepting cmpleymcnt and,
in fact, the only purpose for the f66 iS to 8S6i6t him in
securing employment. That the parent organization is an out
of state concern make6 no difference. The whole mod6 of
operation is designed to accomplish exactly what the statute
Honorable 0. L. Stiefer, Page 6 (WW-471)
intended to prevent, that is, the charging of any fet prior to
the applicant’s obtaining and accepting employment and the
charging of a greater fee than that authorized by Section 8 of
the statute.
The opinion of this office 16 that the charging of a
“search fee” prior to the applicantts obtaining and accepting
employment would amount to a registration fee and would be in
violation of Article 52218-6, Vcrnonls Civil Statutts, which
prohibits a fee to be collected by a-private employment agency
prior to the applicant’s obtaining and accepting employment.
SUMMARY
A “search fee” being collected by a liC6nS6d
employment agency from the applicant for
placing his “resume” with a national organi-
eat ion, one half of such fee to be retained
by the licensed agency, the other half sent
to the national organization, would amount
to a registration fee and it would be in
violation of Article .522la-6, Vernon’ s Civil
Statutes, which prohibits a fee to be
collected before employment has been ob-
tained and accepted by the applicant.
Very truly yours,
WILL WILSON
Attorney General of Texas
Befkzze
Assistant
.