Untitled Texas Attorney General Opinion ( 1945 )

THEATTORNEYGENERA%
OF TEXAS
Ausm 11. TEXAS
GroverSellera
-ON
HonorableLeonardCarltoa,Comnlssioner
Bureau of Labor Statietloa
Au&in, Texas
Dear Sir: opinionHO. o-6879
Fte: Legalityof certainfee0
chargedby employment
agencieein Texas.
Your recent lettersubmittedfor our eoneldemtlon and oglnlon
reada ae follows:
"Section11 of the Texae Emploment and
Lebor Agency Lsw anthorleee a fee to be charged
for obtainingemployneat,such a fee in IIOevent
to exceed $3.00 and same to be collectedfrom the
applicantonly after eaploymenthas been obtained
and acceptedby the applicant. Thle sectionfurther
providesthat such age&e engagedexolueirely
in provldtig employmentfor akllledprofeesional
or clericalpositionamay charge a fee not to exceed
30 percentof the first month'8ealary.
"a. It has been called to our attentionthat
certain employmentagenciesin thie State charge
a registrationfee, that is, when an sppllcant
desiresto be placedon the agsncq'eavailable
liet the applicantpaye said agency a fee regard-
less a8 to whether or llotemploymentle ever given
him or her. Is this permittedby the statutes'l
"b. Other agenoisecharge a flat monthly regie-
tratlonfee such a61 either$1.00 or $2.00 a month,
this cum to be paid by the applicantregardlessof
whether or not emploment ia obtained,and upon the
refusalor failureof the applicantto pay said regie-
trationfee his neme ie wlthdmwn from the list of
availableemploysee. Is this permleeibleunder the
Texas statutes?
"c. Some~agencies,while charging,a‘fUt
raglet~ationfee of either$2.00 or $3.00, then
upon obtaining and aoceptanaeof employmentof
HonorableLeonardCarlton - page 2 - O-6879
the applicantdeductthat from the authorized
30 per cent commieeion. Is this praotloeper-
rlselbleunder our statutes?
Ud. Certainuurees organizationsin this
State am operatingae abore outlinedbut claim
exemptionby virtue of Section 2 of the Act.
The presentTexas Employmentand Iabor Agemy Law va8 enacted
by the 48th Legislature,Aote of 1943, page 86, chapter67, and in designat&
In Vernon'sAnnotatedCivil Statutesof Texas, 1925, am emended,as Article
522la-4. Section 1 (3) definesan employmentor laboragent ae follows:
"(e) '1Bployment or Labor Agent'Ipeaueany
pereon in thie State who for a fee offem or at-
tempts to procureor procuresemploymentfor em-
ployees,or with a fee offers or attapts to
procureor procuresemploymentfor common laborers
or agrloulturalworkers, or any peraonwho for a
fee offers or attemptsto procureor procuree
employeesfor employem, or withouta fee offers
or attemptato procureor procurescommon laborers
or agriculturalworkerefor employera,or any per-
non, regardlessof whethera fee le receivedor due,
offers,or attemptsto supplyor suppliesthe services
of common or agricultural workersto any pereon.",
Section2 of the Act sets forth the exaeptloneto the pro-
visionsof this Act and among other thinge atatee that, #the provisions
of this Act shall not apply to any person,corporation,or charitable
association,charteredunder the laws of Texas for the purposeof conducting
a free employmentbureauor agency;nor to any veterans'organizationor
labor union;nor to any nurses'organizationoperatednot for profit,to
be conductedby recognizedprofeeslonalregietereduureee for the
enrollnwntof Its profaeelonalmembersonb for the purposeof providing
professionalserviceto the public."(Underscoring ours).
Section 11 of the Act Is as follow:
“Fs. Where a fee is chargedfor obtaln-
lng -ployrent such ,feein no event ehall eroeed
the nm of Three ($3) Dollam, which may be col-
lectedfrom the applicantonly after colployment
has been obtainedand acceptedby the applicant;
provided,however,employmentor labor agent8
engagede~clualvelyIn providingemploymentfor
skilled,professional, or clericalpositionemay
charge,with the writtenconsentof the applicant,
a fee not to exceed thirty (30) per centum of the
. -
HonorableLeonardCarlton - page 3 - O-6879
first month'e ealary,which may be collectedfrom
the applicantonly after employmenthae been obtain-
ed and acceptedby the applloant."
State etatuts8fixing the maximumcompensationor fear which
a privateemploymentagencymay collectfrom an applicantfor employment
have been uphelda8 a proper exerciseof the etate'epolleepower
and ae being for the generalwelfareof the people of the State in gemoral.
Constitutional Law, 16 C. J 5. 1444, per 690, note 11. In the cam of
Olsen YEI.State of Nebraska,(Il.8. sup. Ct., 1941) 31.3 u. s. 236, 85
L. ed. 130, 61 S. C. R. 862, I.33A. L. R. 1500, the SupremeCourt of the
UnitedStates overmled an earlierdecision and upheld a similarlebraeh
Statuteregulatingprivateemploymentagencieswhlah fixed the maxlmum
compeneatlonwhich an agencymight collectfram an applicantfor arploy-
ment. The Court In the Oleen cane overruledthe caee of Rlbnik ~8. NcRrlde
(1929 277 U S. 350, 72 L. ed. 913, 48 S. C R. 545, 56 A. L. B. l321,
and la the Olmn caee Bald:
“The drift away from Ribnlk v. &Bride
. . . has been so great that it can no longer
be deemed a controllingauthority. It wa.8de-
cided in 1928 . . . The lubaequentcaeee in
th1.scourt (with two exceptions)have given
increaeingly wider scope to the price-fixing'
power. of the state and of Congrees."
Ribnlk ve. NoBride controlledthe decielonof the ‘bra8 Court
of CriminalAppeals in the caee of Karr ~8. State (1932),I22 Tex. Crlm.
Rep.~88, 54 S. W (26) 92, where it war held that the then Article 1589
of the Penal Code, 1925, (sincerepealedby tbc presentSection 11 of
the preeentTexas Rmployhentand Iabor Agent LAW), making it a criminal
offensefor employmentagenciesto engage in providingemploymentfor
ekilled,professional, or clericalpoaitioneto charge for euch services
a fee exceedingtwenty (20) per cent of the firetmonth'e salarywae held
violativeof the due processclause of the 14th Amendmentto the Pederal
Con8titution.Judge Chrletian,writingfor the Court in the Kerr case
held: "The decieioaof the SupremeCourt of the United States In Rlbnlk
v. McBride,rupra, touchingthe power of the state to regulatefee#
that m8y be chargedby employmentagencieo,18 bindingupon thin court.
Giring It effect in the prerentcase, it become8Wr duty to order a
rcvemal.* In view of the later opinionof the SupremeCourt in the Oleen
care, and the luthorltlescited in 16 C. J. S., supra, it ie our opinion
that Section 11 ir valid.
We therefore,aneweryour queetionea, b, c, and d, In the
negative. The provleioarof Section 11 are plali. A,,Three ($3) Dollare
fee 'may be collectedfrom the lpplicantonly after employmentha8 been
obtilnedand acceptedby the lppliCeut"jbut where the employmentor
labor agent ir engagedexclarire4 in providingemploymentfor ekilled,
proferrional, dk:clericalpoeitione,he may oherge "with the writtenconeent
HonorableLeonardCarlton - page 4 - o-6679
of the applicanta fee not to exceedthirtyper cent of the fir& month'e
ealary,which may be collectedfrom applicanton4 after employmenthae
been obtainedand acceptedby the applicant."
The fees are to be paid by the applicantor employeeon4 after
the employmenthae been obtainedand acceptedby the applicant. Any
fee or chargeemade to or paid by the applicantprior to thle event le
contraryto and le am attemptto circumventthe statute. The payment
of the feee are contingentupon obtainingemploy&at atidthe acceptance
of the employmentby the applicant.
A8 to your qneetion(d), if thee8 numea organisetloneare
operatedfor a profit then they do not come within the purviewof the
exceptionaprovidedby lectlon2 of the Act end the provleionrof the Act
govern such organization.
Very truly yours,
BY
Devid Wnutch
Aealetant
APPROVED OCT. 19, 1945
n/ CABIAS~ c. AsRIm
FIRST ASSISTS
ATTORNEY &NERAL