in Re iWORKS Personnel, Inc., Luis Trevino, and Haydee Gutierrez

ACCEPTED
01-15-00235-CV
FIRST COURT OF APPEALS
HOUSTON, TEXAS
3/13/2015 8:34:01 PM
01-15-00235-CV CHRISTOPHER PRINE
CLERK
Local Rule Notice of and Assignment
of Related Case in Original Proceedings
FILED IN
As required by the Local Rules Relating to Assignment of 1stRelated
COURT OF APPEALS
Cases to
HOUSTON, TEXAS
and Transfers of Related Cases between the First and Fourteenth Courts of
3/13/2015 8:34:01 PM
Appeals, I certify that the following related appeal or original proceeding has been
CHRISTOPHER A. PRINE
previously filed in either the First Court of Appeals: Clerk
Guillory v. Seaton, LLC d/b/a Staff Management
Appellate Case No. 01-14-00379-CV
Trial Case No. 2012-61407A, 113th District Court, Harris County, Texas
Respectfully submitted,
/s/ David N. Anderson
DAVID N. ANDERSON
TBN: 00797951
THE ANDERSON LAW FIRM
4309 Yoakum
Houston, TX 77006
(713) 521-6563 - Telephone
(888) 824-5624 – Fax
danderson@lodna.net
FILED IN
st
1 COURT OF APPEALS
HOUSTON, TX
MAR 13, 2015 01-15-00235-CV
CHRISTOPHER A. PRINE,
CLERK
No. __________________
IN THE COURT OF APPEALS
FOR THE FIRST DISTRICT OF TEXAS
In re IWORKS PERSONNEL, INC.,
LUIS TREVINO, AND HAYDEE GUTIERREZ,
Relators
Original Proceeding on Petition for Writ of Mandamus
From the 113th District Court, Harris County, Texas
Honorable Michael Landrum, Judge Presiding, Respondent
Cause No. 2012-61407
PETITION FOR WRIT OF MANDAMUS
DAVID N. ANDERSON
TBN: 00797951
THE ANDERSON LAW FIRM
4309 Yoakum
Houston, TX 77006
(713) 521-6563 - Telephone
(888) 824-5624 – Fax
danderson@lodna.net
ATTORNEY FOR DEFENDANTS
IWORKS PERSONNEL, INC.,
LUIS TREVINO, and
HAYDEE GUTIERREZ
ORAL ARGUMENT REQUESTED
Identity of Parties and Counsel
Relators iWORKS Personnel, Inc., Luis Trevino, and
Haydee Gutierrez
Counsel for Relators David N. Anderson
Texas Bar No. 00797951
THE ANDERSON LAW FIRM
4309 Yoakum
Houston, TX 77006
(713) 521-6563 - Telephone
(888) 824-5624 – Fax
danderson@lodna.net
Respondent The Honorable Michael Landrum
113th Judicial District Court
Harris County Civil Courthouse
201 Caroline, 10th Floor
Houston, TX 77002
(713) 368-6113 – Telephone
Real Parties in Interest Mose Guillory and Mary Guillory
Counsel forReal Party in Interest Bradford J. Gilde
Texas Bar No. 24045941
bjg@gildelawfirm.com
GILDE LAW FIRM
55 Waugh, Suite 850
Houston, TX 77007
(281) 973-2772 – Telephone
(281) 973-2771 – Fax
Co-Defendant / Cross-Defendant Waste Management, Inc.
Counsel for Co-Defendant / B. Lee Wertz, Jr.
Cross-Defendant Texas Bar No. 00797796
lwertz@munsch.com
MUNSCH, HARDT, KOPF, AND HARR, P.C
700 Milam Street, Suite 2700
Houston, Texas 77002-2806
(713) 222-1470– Telephone
(713) 222-1475– Fax
ii
Table of Contents
Identity of Parties and Counsel ......................................................................... ii
Table of Contents ............................................................................................. iii
Table of Authorities ...........................................................................................v
Cases ......................................................................................................v
Statutes .................................................................................................. vi
Other Authorities ................................................................................... vii
Rules ..................................................................................................... vii
Regulations ........................................................................................... vii
I. Statement of the Case................................................................................... 2
III. Issue Presented .......................................................................................... 4
Did the trial court abuse its discretion when it refused to dismiss claims
over which it has no subject matter jurisdiction because the Division
of Worker’s Compensation has exclusive jurisdiction and Plaintiff has
not exhausted his administrative remedies? ............................................... 4
IV. Statement of Facts ...................................................................................... 4
V. Summary of Argument ................................................................................. 6
VI. Standard of Review..................................................................................... 7
VII. Argument ................................................................................................... 8
A. The trial court does not have subject matter jurisdiction and any judgment
it renders is void as a matter of law. ........................................................ 8
B. The Act demonstrates the legislature’s intent that the Act provide the
exclusive remedy for on-the-job injuries. ............................................... 10
C. Through its broad rule making and enforcement provisions, the Act
empowers the DWC to resolve disputes, enforce compliance, and
punish offenders. ................................................................................... 13
D. Real Party’s failure to exhaust his administrative remedies under the
Act precludes the trial court’s exercise of jurisdiction over this matter. . 16
1. Real Party consciously chose to circumvent the Act in pursuit of
common-law remedies for his work-place injury. ................................. 16
2. The laws embodied in the Act and the rules promulgated by the DWC
mandate that iWORKS policy was in effect on the date that Real Party
was injured at work. ............................................................................. 19
E. The DWC has exclusive jurisdiction to determine coverage. .................. 28
iii
F. The newly released Crawford opinion confirms the Court’s prior findings
that it is the intent of the legislature that the DWC have exclusive
jurisdiction out of work-place injury claims and that even artful pleadings
will not let Plaintiff’s recast their claims outside of the purview of the Act.
............................................................................................................... 34
VIII. Conclusion ............................................................................................. 37
IX. Prayer ....................................................................................................... 39
Certificate of Service ...................................................................................... 40
Verification and Certificate of Compliance ..................................................... 41
Appendix ........................................................................................................ 42
iv
Table of Authorities
Cases
Aranda v. Insurance Co. of N. Am., 748 S.W.2d 210, 212 (Tex. 1988) ........ 10, 14
Arranda v. Ins. Co. of North Amer., 748 S.W.2d 210 (Tex. 1988)................. 11, 16
Bland Indep. Sch. Dist. v. Blue, 34 S.W.3d 547, 553–54 (Tex.2000) ............... 7, 9
Cain v. Bain, 709 S.W.2d 175 (Tex. 1986 ........................................................... 33
Carr v. Carroll Company, 646 S.W.2d 561 (Tex. App.-Dallas 1982, writ ref'd
n.r.e.) ................................................................................................................ 32
Carroll v. Carroll, 304 S.W.3d 366, 367 (Tex. 2010) ............................................. 9
Cash Am. Int’l., Inc. v. Bennett, 35 S.W.3d 12, 15 (Tex. 2000)........................... 17
City of Houston v. Rhule, 417 S.W.3d 440, 442 (Tex. 2014, per curium) . 9, 17, 18
County of Cameron v. Brown, 80 S.W.3d 549, 555 (Tex. 2002) ....................... 7, 8
Cunningham Lindsey Claims Mgmt. v. Snyder, 291 S.W.3d 472, 477 (Tex.App.—
Houston [14th Dist.] 2009, pet. denied) ............................................................ 18
Dubai Petrol. Co. v. Kazi, 12 S.W.3d 71, 76 (Tex.2000) ....................................... 9
Entergy Gulf States, Inc. v. Summers, 282 S.W.3d 433, 453 (Tex., 2009) ......... 20
Gonzales v. Cigna Ins. Co. of Tex, 924 S.W.2d 183, 184-87 (Tex.App.—San
Antonio 1996, write denied) ............................................................................. 36
Houston Gen. Ins. Co. v. Ass’n Cas. ins. Co., 977 S.W.3d 634, 636 (Tex.App.—
Tyler 1998, no pet.) .......................................................................................... 31
Houston Gen. Ins. Co. v. Association Cas. Ins. Co., 972 S.W.2d 634, 636
(Tex.App.—Tyler 1998, no pet.) ....................................................................... 36
Huffman v. S. Underwriters, 133 Tex. 354, 128 S.W.2d 4, 6 (1939) ................... 20
Hulshouser v. Texas Workers’ Compensation Ins. Fund, 139 S.W.3d 789, 792
(Tex. App.—Dallas 2004, no pet.). ................................................................... 11
In Re Crawford, No. 14-0256 (Tex. February 27, 2015) (per curiam) ...... 11, 37-39
In re Entergy Corp., 142 S.W.3d 316, 321 (Tex. 2004). ........................................ 4
In Re Liberty Ins. Corp., 321 S.W.3d 630 (Tex.App.—Houston [14th Dist.] 2010)
(orig. proceeding) ............................................................................................. 10
In Re Liberty Mut. Fire Ins. Co., 295 S.W.3d 327 329 (Tex. 2009) ................. 4, 40
In Re Liberty Mut. Fire Ins. Co., 295 S.W.3d 327, 328 (Tex. 2009) (orig.
proceeding) (per curiam) .............................................................................. 4, 10
In re Liberty Mutual Fire Ins. Co., 295 S.W.3d 327, 328 (Tex. 2009).................... 3
In Re Mid-Century Ins. Co. of Tex., 426 S.W.3d 169, 172 (Tex.App.—Houston
[1st Dist] 2012) (orig. proceeding) ..................................................................... 15
In re Poly-Am., L.P., 262 S.W.3d 337, 349 (Tex. 2008) .......................... 11, 15, 22
In Re Sw. Bell Tel. Co., 235 S.W.3d 619, 624 (Tex. 2007) ................................... 4
In Re Tex. Mut. Ins. Co. ...................................................................................... 32
In Re United Servs. Auto Ass’n, 307 S.W.3d 299, 209 (Tex. 2010)...................... 9
In re United Servs. Auto. Ass'n, 307 S.W.3d 299, 306 (Tex.2010) ..................... 10
v
Ins. Co. of Pa. v. Hartford Underwriters Ins. Co., 164 S.W.3d 747 (Tex.App.—
Houston [14th Dist.] 2005, no pet.) ................................................................... 31
Liberty Mut. Ins. Co. v. Adcock, 412, S.W.3d 492, 495 (Tex. 2013) ................... 14
Millers' Mut. Cas. Co. v. Hoover, 235 S.W. 863, 864 (Tex. Comm'n App.1921,
judgm't adopted) .............................................................................................. 22
Morales v. Liberty Mut. Sinc. Co., 241 S.W.3d 514 (Tex. 2007)....................... 31, 33
Peek v. Equip. Serv. Co. of San Antonio, 779 S.W.2d 802, 805 (Tex. 1989). ...... 8
Port Elevator-Brownsville, L.L.C. v. Casados, 358 S.W.3d 238 (Tex. 2012) ...... 20
Richmond v. L. D. Brinkman & Co. (Texas) Inc., 36 S.W.3d 903 (Tex. App.-Dallas
2001, pet. denied) ............................................................................................ 33
Saenz v. Fidelity & Guaranty Insurance Underwriters ........................................ 15
Scwartz v. Ins. Co. of Pa. ...................................................................................... 7
Southern Sur. Co. v. Inabnit, 1 S.W.2d 412, 413-414 (Tex.Civ.App.-Eastland
1927, no writ) ................................................................................................... 22
Subaru of Am. v. David McDavid Nissan, Inc., 84 S.W.3d 212, 221 (Tex. 2002) 15
Tex. Ass'n of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440, 446 (Tex.1993). ...... 7
Tex. Dep't of Parks & Wildlife v. Miranda, 133 S.W.3d 217, 226 (Tex.2004) ........ 7
Tex. Dep't of Transp. v. Jones, 8 S.W.3d 636, 638 (Tex.1999) ............................ 7
Tex. educ. Agency v. Cypress-Fairbanks I.S.D., 830 S.w.2d 88, 90 (Tex. 1992) 18
Tex. Mut. Ins. Co. v. Ruttiger, 381 S.W.3d 430, 344 (Tex. 2012) ........... 16, 38, 39
Tex. Worker’s Comp. Comm’n v. Garcia, 893 S.W.2d 504, 517 n.15 (Tex. 1995) 9
Texas Workers’ Compensation Insurance Fund v. DEL Industrial, Inc., 35 S.W.3d
591 (Tex. 2000) ................................................................................................ 32
U.S. Fid. & Guar. Co. v. Goudeau, 272 S.W.3d 603, 610 (Tex. 2008) ............... 26
Waco ISD v. Gibson, 22 S.W.3d 849, 851 (Tex. 2000) ....................................... 10
Statutes1
§ 91.001, et seq. .................................................................................................. 29
§ 93.004 .............................................................................................................. 29
§§ 401.001 – 451.003 ........................................................................................... 1
§ 401.011 ............................................................................................................ 32
§ 401.012 ............................................................................................................ 32
§ 401.013 ............................................................................................................ 36
§ 402.001 ................................................................................................ 10, 21, 34
§ 402.00111 ........................................................................................................ 21
§ 402.00114 ........................................................................................................ 35
§ 402.00117 ........................................................................................................ 21
§ 402.061 ............................................................................................................ 21
§ 406.002 ............................................................................................................ 21
§ 406.008 ............................................................................................................ 26
1 All cites are to the Texas Labor Code.
vi
§ 406.031 ............................................................................................................ 32
§ 406.032 ............................................................................................................ 36
§ 406.033 ............................................................................................................ 36
§ 408.001 ...................................................................................................... 10, 13
§ 409.004 ...................................................................................................... 18, 20
§ 409.005 ............................................................................................................ 10
§ 409.021 ............................................................................................................ 11
§ 410.165 ............................................................................................................ 30
§ 410.205 ............................................................................................................ 11
§ 410.301 ...................................................................................................... 31, 32
§ 414.002 ............................................................................................................ 35
§ 415.001 ............................................................................................................ 11
§ 415.002 ............................................................................................................ 11
§ 415.008 ............................................................................................................ 11
§ 415.021 ...................................................................................................... 11, 35
§ 415.031 ............................................................................................................ 11
§ 415.034 ............................................................................................................ 11
Other Authorities
Appeals Panel No. 021771 (Division of Worker’s Compensation, September 3,
2002) ................................................................................................................ 29
Appeals Panel No. 030660 (Division of Worker’s Compensation, April 28, 2003)
......................................................................................................................... 29
Appeals Panel No. 101718 (Division of Worker’s Compensation, March 21, 2011)
......................................................................................................................... 30
Rules
Tex. Rule of Civ. P. 198.3 ................................................................................... 24
Regulations
28 TEX. ADMIN. CODE § 43.10 ........................................................................ 26, 27
28 TEX. ADMIN. CODE § 110.1 .............................................................................. 27
vii
No. __________________
IN THE COURT OF APPEALS
FOR THE FIRST DISTRICT OF TEXAS
In re IWORKS PERSONNEL, INC.,
LUIS TREVINO, AND HAYDEE GUTIERREZ,
Relators
Original Proceeding on Petition for Writ of Mandamus
From the 113th District Court, Harris County, Texas
Honorable Michael Landrum, Judge Presiding, Respondent
Cause No. 2012-61407
PETITION FOR WRIT OF MANDAMUS
TO THE HONORABLE FIRST COURT OF APPEALS:
This is a worker’s compensation case. Through artful pleading Plaintiff has
sought to recast this case as a non-subscriber case, a breach of contract case, a
fraud case, a third-party beneficiary case, and so on. However, the Division of
Worker’s Compensation has exclusive jurisdiction over Plaintiff’s claims, no matter
how artfully plead, and the trial court lacks subject matter jurisdiction until Plaintiff
has exhausted the administrative remedies provided by the Worker’s
Compensation Act2 (the “Act”).
2TEXAS LABOR CODE, Title V, Subtitle A (“Texas Workers’ Compensation Act), §§ 401.001
– 451.003. Unless otherwise indicated, all code references in this petition refer to the
Texas Labor Code.
1
This issue is of vital importance because the carefully balanced dispute
resolution and enforcement procedures that the legislature built into the system
are lost if a claimant can circumvent the Act by refusing to pursue his administrative
remedies and simply recasting his claims as common-law or extra-statutory
causes of action. This Court should exercise its mandamus jurisdiction in this case
and order the trial court to dismiss Plaintiff’s causes of action.
I. Statement of the Case
Nature of the case. Relator, iWORKS Personnel, Inc. (“iWORKS”) is a
temporary staffing company who contracted with Defendant, Waste Management,
Inc. (“WM”) to provide temporary labor at its waste processing facility. Real Party,
Mose Guillory (“Real Party”),3 was a temporary worker assigned by iWORKS to
work at WM’s facility. Real Party was injured on August 5, 2012 while working at
the WM facility. He subsequently sued iWORKS,4 WM, Inc. (“WM”), and Seaton,
LLC d/b/a Staff Management (“SM”),5 a third party administrator of WM’s
temporary labor program.
3 Real Party’s wife, Mary Guillory, is a Plaintiff in this case. Plaintiffs’ Fifth Amended
Petition makes no express claims on her behalf, but it does seek damages for loss of
consortium and loss of household services. Her claims are all derivative of Real Party’s
claims. As used in this petition, “Real Party” refers to both Mose Guillory and Mary
Guillory.
4 Plaintiff also sued iWORKS’ CEO, Luis Trevino, and President, Haydee Gutierrez, in
their individual capacities. They joined iWORKS in this petition. As used in this petition,
“iWORKS” refers to both the company and the two individuals.
5The trial court granted SM’s Rule 91a motion to dismiss. Plaintiff’s appeal is currently
pending before this Court (No. 01-14-00379-CV).
2
Trial court. The Honorable Michael Landrum, 113th Judicial District Court of
Harris County, Texas (“Respondent” or “trial court” herein).
Proceedings in the trial court. Relators challenged the trial court’s subject
matter jurisdiction based upon the exclusive jurisdiction of the Texas Department
of Insurance, Division of Worker’s Compensation (“DWC”) and Real Party’s failure
to exhaust the administrative remedies available under the Act before the DWC.
Relators also challenged Real Party’s causes of action based on traditional and no
evidence motions for summary judgment, aside from the jurisdictional challenges.
The trial court granted Relators’ challenges to numerous of Real Party’s causes of
action, but denied Relators’ jurisdictional challenges on the remaining claims and
causes of action by Order dated February 20, 2015.6 It is from the trial court’s
assertion of jurisdiction over those remaining claims that Relators seek mandamus
relief.
II. Statement of Jurisdiction
This Court has jurisdiction pursuant to Tex. Gov’t Code § 22.002(a).
Mandamus relief is appropriate to correct a trial court’s assertion of subject
matter jurisdiction over a case that lies squarely within the exclusive jurisdiction
of an administrative agency, here the DWC over the Texas workers’
6 Tab 1
3
compensation system.7 This erroneous assertion of jurisdiction is an abuse of
discretion. Permitting the trial court to improperly assert jurisdiction results not
only in hardship to Relators, but also interferes with the “legislatively mandated
function and purpose” of the DWC, undermines the Legislature’s intent to create
a comprehensive scheme to govern workers’ compensation claims in Texas,8
and effectively abrogates the Act, leaving Relators with no adequate remedy by
appeal.9 This court can correct the trial court’s assertion of subject matter
jurisdiction here through a writ of mandamus because the underlying claims lie
within the exclusive jurisdiction of the DWC.
III. Issue Presented
Did the trial court abuse its discretion when it refused to dismiss claims over
which it has no subject matter jurisdiction because the Division of Worker’s
Compensation has exclusive jurisdiction and Plaintiff has not exhausted his
administrative remedies?
IV. Statement of Facts
Real Party was severely injured on August 5, 2012 while in the course of
his employment at Waste Management’s waste reclamation facility in Houston,
Texas. Real Party was a temporary worker recruited by IWORKS and assigned
to operate a front-end loader at WM’s facility. At some point WM reassigned Real
7In re Liberty Mutual Fire Ins. Co., 295 S.W.3d 327, 328 (Tex. 2009), citing In Re Sw.
Bell Tel. Co., 235 S.W.3d 619, 624 (Tex. 2007); In re Entergy Corp., 142 S.W.3d 316,
321 (Tex. 2004).
8 Tex. Mut. Ins. Co. v. Ruttiger, 381 S.W.3d 430, 344 (Tex. 2012)
9See In re Entergy, 142 SW.3d at 321; In Re Liberty Mut. Fire Ins. Co., 295 S.W.3d at
328.
4
Party to operate a Harris Baler.10 Real Party was injured when he entered the
baler to clear a jam without depowering the machine. The baler activated and
severed his right leg below the knee and half of his left foot.
This lawsuit arises from Real Party’s attempt to recover damages for the
injuries he sustained while employed at the WM facility. Throughout this suit Real
Party has asserted various causes of action, some sounding in tort (negligence,
gross negligence, negligence per se, negligent hiring, training, and supervision,
common law fraud, fraud by non-disclosure, and negligent undertaking); some
sounding in contract (breach of contract as third-party beneficiary to the iWORKS
/ WM service agreement and breach of contract as a third-party beneficiary of the
WM / SMX agreement). Real Party has also alleged numerous theories of
vicarious liability (respondeat superior, joint enterprise, and partnership liability).
Real Party’s claims against iWORKS have been narrowed down to negligence,
negligence per se, gross negligence, negligent hiring, training, and supervision,
breach of contract, respondeat superior, partnership liability, and joint enterprise
liability.11 Regardless of how artfully or inventively labeled or recast, all of
10 A Harris Baler is essentially a gigantic trash compactor which compacts sorted refuse
into dense bales. The material is fed into the baler via a conveyor belt which dumps the
material into the compacting chamber.
11 The trial court denied iWORKS’ motion for summary judgment on all causes except for
breach of contract, which it granted. However, the trial court declined to dismiss the same
contract claims against Trevino and Gutierrez, even though they were neither parties nor
signatories to the contract in their individual capacities. The trial court also dismissed
Plaintiff’s negligence claims against Trevino and Gutierrez, but left the gross negligence
claims against them intact. Thus, while as a matter of law Trevino and Gutierrez are not
negligent, they are still subject to liability on Plaintiff’s gross negligence claims. Likewise,
5
Plaintiff’s claims flows directly from his on-the-job injury.
V. Summary of Argument
Real Party’s claims fall within the exclusive jurisdiction of the DWC, and
therefore, the trial court is without subject matter jurisdiction to consider these
claims until they have exhausted all administrative remedies provided for under
the Act. Allowing a participant in the worker’s compensation system to pursue such
claims in a civil action is incompatible with the comprehensive administrative
processes and other remedies in the Act.
Despite Real Party’s attempts to avoid the Act by creatively pleading their
complaints, the essence of their suit falls squarely under the purview of the DWC.
To hold otherwise would allow claimants to easily avoid the exclusive jurisdiction
of the Act by simply relabeling their claims as other common law or statutory
theories, even though such claims are equally incompatible with the administrative
processes and other remedies in the Act. This is precisely why the Texas Supreme
Court has repeatedly emphasized the legislative intent that there be no alternative
remedies available outside the Act.
they are also subject to same breach of contract liability that the trial court found their
company, a party to the contract, not liable for as a matter of law. The trial court denied
Relators’ motion to reconsider these paradoxical results.
6
VI. Standard of Review
This Court set forth the proper standard of review in in this matter in Scwartz
v. Ins. Co. of Pa.12
A plea to the jurisdiction contests a trial court's subject matter
jurisdiction. Tex. Dep't of Transp. v. Jones, 8 S.W.3d 636, 638
(Tex.1999). Whether a court has subject matter jurisdiction is a matter
of law. Tex. Dep't of Parks & Wildlife v. Miranda, 133 S.W.3d 217, 226
(Tex.2004). Accordingly, we review a challenge to the trial court's
subject matter jurisdiction de novo. Id. at 228.
When reviewing a plea to the jurisdiction, we must look to the
allegations in the pleadings, construe them in the plaintiff's favor, and
consider the pleader's intent. See County of Cameron v. Brown, 80
S.W.3d 549, 555 (Tex. 2002). In doing so, we consider the facts
alleged in the petition, and to the extent relevant to the jurisdictional
issue, any evidence submitted by the parties to the trial court. See
Bland Indep. Sch. Dist. v. Blue, 34 S.W.3d 547, 555 (Tex. 2000). The
plaintiff bears the burden to allege facts affirmatively demonstrating
the trial court's jurisdiction to hear a case. See Tex. Ass'n of Bus. v.
Tex. Air Control Bd., 852 S.W.2d 440, 446 (Tex.1993). If a plaintiff
pleads facts that affirmatively demonstrate an absence of jurisdiction
and the jurisdictional defect is incurable, then the cause is properly
dismissed. Peek v. Equip. Serv. Co. of San Antonio, 779 S.W.2d 802,
805 (Tex. 1989). However, when the plaintiff fails to plead facts that
establish jurisdiction, but the petition does not affirmatively
demonstrate incurable defects in jurisdiction, the issue is one of
pleading sufficiency, and the plaintiff should be afforded the
opportunity to amend. Brown, 80 S.W.3d at 555.
Plaintiff’s Fifth Amended Petition pleads facts and cites exhibits that place this
matter squarely within the exclusive jurisdiction of the DWC. The evidence
considered by the trial court in relation iWORKS’ plea to the jurisdiction also
supports the DWC’s exclusive jurisdiction.
12 274 S.W.3d 270, 273-74 (Tex. App.—Houston [1st Dist.] 2008, pet. denied).
7
In support of this petition iWORKS has provided this Court with the following
pleadings:
1) Plaintiff’s Fifth Amended Petition;13
2) iWORKS’ Plea to the Jurisdiction;14
3) iWORKS’ Supplemental Plea to the Jurisdiction15; and
4) Plaintiff’s Response to iWORKS’ Plea to the Jurisdiction.16
All exhibits submitted with these pleadings and considered by the trial court are
found in the Appendix.17 No party offered sworn testimony at the oral hearing on
this matter. Relators have ordered a transcript of the oral argument and will
supplement the mandamus record as soon as the transcript is received from the
court reporter.
VII. Argument
A. The trial court does not have subject matter jurisdiction and any
judgment it renders is void as a matter of law.
The trial court erred when it exercised jurisdiction in this case because it
does not have subject-matter jurisdiction over Plaintiff’s claims related to his injury
at work. Without subject-matter jurisdiction the trial court cannot render a valid
judgment in this matter.18 “Subject matter jurisdiction is ‘essential to a court’s
13 Tab 2 (hereinafter “Petition”).
14 Tab 5
15 Tab 12
16 Tab 15 (hereinafter “Response”)
17 Real Party attached three exhibits totaling 561 pages to his Response. Real Party’s
exhibits are submitted to this Court in the same form as submitted to the trial court.
18 City of Houston v. Rhule, 417 S.W.3d 440, 442 (Tex. 2014, per curium)
8
power to decide a case.’”19 Subject-matter jurisdiction cannot be waived, nor can
it be given or taken away by consent.20 “A judgment rendered without subject
matter jurisdiction cannot be considered final.”21
Lack of subject-matter jurisdiction makes a judgment void, not just
voidable.22 Lack of subject-matter jurisdiction is fundamental error and can be
raised at any time.23 Lack of subject-matter jurisdiction can even be raised for the
first time on appeal. “Not only may a reviewing court assess jurisdiction for the
first time on appeal, but all courts bear the affirmative obligation ‘to ascertain that
subject matter jurisdiction exists regardless of whether the parties have questioned
it.’”24 Furthermore, the failure to grant a plea to the jurisdiction for failure to exhaust
administrative remedies with the DWC is subject to this Court’s mandamus
review.25
19 Id. (quoting Bland Indep. Sch. Dist. v. Blue, 34 S.W.3d 547, 553–54 (Tex.2000)).
20 Carroll v. Carroll, 304 S.W.3d 366, 367 (Tex. 2010).
21 Rhule, 417 S.W.3d at 442 (citing Dubai Petrol. Co. v. Kazi, 12 S.W.3d 71, 76
(Tex.2000)).
22 In Re United Servs. Auto Ass’n, 307 S.W.3d 299, 209 (Tex. 2010).
23Tex. Worker’s Comp. Comm’n v. Garcia, 893 S.W.2d 504, 517 n.15 (Tex. 1995) (noting
that a trial court can question its subject-matter jurisdiction even without a motion by either
party).
24Waco ISD v. Gibson, 22 S.W.3d 849, 851 (Tex. 2000); see Rhule, 417 S.W.3d at 442
(quoting In re United Servs. Auto. Ass'n, 307 S.W.3d 299, 306 (Tex.2010)).
25 See In Re Liberty Mut. Fire Ins. Co., 295 S.W.3d 327, 328 (Tex. 2009) (orig.
proceeding) (per curiam); In Re Liberty Ins. Corp., 321 S.W.3d 630 (Tex.App.—Houston
[14th Dist.] 2010) (orig. proceeding).
9
B. The Act demonstrates the legislature’s intent that the Act provide the
exclusive remedy for on-the-job injuries.
The Act provides a compensation system for “personal injuries sustained
by an employee in the course and scope of his employment.”26 In exchange for
prompt remuneration of benefits to the employee with no burden of proof as to
negligence, the Act prevents employees from seeking common law remedies
against the employer, agent or employee of the employer for on-the-job
injuries.27 The Act also limits employers’ exposure to the uncertainties of
litigation costs and awards.28 Recovery under the Act is intended to be an
injured employee’s sole remedy for work-related injuries.29
The legislature empowered the DWC to administer and operate the
workers’ compensation system of Texas.30 The system’s processes are initiated
by the worker reporting an occupational injury or disease to the employer, after
which the employer must report the injury claim to the carrier. 31 Disputes
regarding general compensability and extent of injury are addressed under
26 Aranda v. Insurance Co. of N. Am., 748 S.W.2d 210, 212 (Tex. 1988).
27Id.; see § 408.001(a); Hulshouser v. Texas Workers’ Compensation Ins. Fund, 139
S.W.3d 789, 792 (Tex. App.—Dallas 2004, no pet.).
28See Ruttiger, 381 S.W.3d at 441, citing In re Poly-Am., L.P., 262 S.W.3d 337, 349
(Tex. 2008). 29 Hulshouser, 139 S.W.3d at 792.
29 In Re Crawford at p. 9, No. 14-0256 (Tex. February 27, 2015) (per curiam) (a copy is
attached to the Appendix at Tab 22).
30 § 402.001(b).
31 § 409.005(a).
10
Chapter 410 of the Texas Labor Code, while Chapter 413 controls disputes
concerning specific medical benefits, including medical fees disputes and
medical necessity disputes. This matter falls under Chapter 410
Additional safeguards are built into the workers’ compensation system to
monitor compliance with the rules and regulations in Chapter 415, entitled
“Administrative Violations,” as well as provisions in Chapters 409 and 410.32 For
example, these provisions allow fines of up to $25,000 per day, per violation for
an insurer’s conduct, including, for example:
a) making a false or misleading statement; 33
b) failing to process claims reasonably;34
c) unreasonably disputing the reasonableness and necessity of health
care;35
d) conspiring to commit an act that is a violation;36 and
e) other conduct violating Commission rules.37
Any system participant can initiate an investigation by the DWC of possible
administrative violations.38 Procedurally, administrative violations follow a path
similar to Chapter 413 disputes.39
32 See generally §415.001, et seq.; §409.021; §410.205.
33 §415.008.
34 §415.002(a)(11).
35 §415.002(a)(19).
36 §415.008.
37 §415.008; §415.021.
38 §415.031.
39 §415.034-5.
11
In 1989 the Texas Legislature overhauled the worker’s compensation
system to address the system’s deficiencies, to balance the interests and
concerns of the worker and the employer (or insurance carrier), and to provide
more efficient results for all parties. Prior to that time and up to this Court’s
opinion in Ruttiger, the shortcomings of the system necessitated this Court’s
acknowledgement of a common law cause of action for extra-contractual
damages. In Ruttiger, this Court set out its analysis of the respective roles of
the Legislature and this Court in relation to the Act and the worker’s
compensation system as a whole. Improvements to the pre-1989 system were
cited to include the following:
1) reduction of the disparity of bargaining power between
employees and insurance carriers;
2) removal of insurers’ exclusive control over the processing of
claims;
3) curtailment of insurers’ ability to refuse or unreasonably deny
payment of valid claims in an arbitrary manner;
4) provision of information to employees and free assistance before
the DWC process through the ombudsman program; and
5) provision of multiple remedies and penalties to enforce the
parties’ rights and to regulate the parties’ conduct, up to and
including revocation of a carrier’s right to do business in Texas “if
on multiple occasions it fails to pay benefits promptly and as they
accrue.”40 The Legislature provided injured workers with tools
to which they did not previously have access. Carefully
considering these improvements to the system, this Court held
that common law causes of action outside the framework of the
Act are no longer necessary when the Act covers the
complained-of conduct or the remedy sought.41
40 Ruttiger, 381 S.W.3d at 449-450.
41 Id. at 444, 445, 451.
12
Recognizing the broad scope and encompassing remedies brought about by the
1998 revisions to the Act, the Texas Supreme Court held that “the Court should
not alter the Act’s comprehensive scheme.” 42
C. Through its broad rule making and enforcement provisions, the Act
empowers the DWC to resolve disputes, enforce compliance, and
punish offenders.
The Act provides a compensation system for “personal injuries sustained
by an employee in the course and scope of his employment.” 43 In exchange for
prompt remuneration of benefits to the employee with no burden of proof as to
negligence, the Act prevents employees from seeking common law remedies
against the employer, agent or employee of the employer for on-the-job
injuries.44 The Act also limits employers’ exposure to the uncertainties of
litigation costs and awards.45 Recovery under the Act is intended to be an
injured employee’s sole remedy for work-related injuries.29
An agency has exclusive jurisdiction “when a pervasive regulatory scheme
indicates that Congress intended for the regulatory process to be the exclusive
42Liberty Mut. Ins. Co. v. Adcock, 412, S.W.3d 492, 495 (Tex. 2013) (explaining that “the
Legislature devised a comprehensive workers’ compensation system, with specific
benefits and procedures based on the public policy of the State of Texas. We concluded
in Ruttiger that the Court should not alter the Act’s comprehensive scheme, and we
reaffirm that principle today.”)
43 Aranda v. Insurance Co. of N. Am., 748 S.W.2d 210, 212 (Tex. 1988).
44Id.; § 408.001(a); Hulshouser v. Texas Workers’ Compensation Ins. Fund, 139 S.W.3d
789, 792 (Tex. App.—Dallas 2004, no pet.).
45See Ruttiger, 381 S.W.3d at 441, citing In re Poly-Am., L.P., 262 S.W.3d 337, 349 (Tex.
2008).
13
means of remedying the problem to which the regulation is address.”46 “An agency
has exclusive jurisdiction . . . when a pervasive regulatory scheme reflects
legislative intent that an agency have the sole power to make the initial
determination in the dispute.”47 Exclusive jurisdiction is a question of law that turns
on statutory interpretation.48 The Texas Supreme Court held in Saenz v. Fidelity
& Guaranty Insurance Underwriters that “the Workers’ Compensation Act vests the
power to award compensation benefits solely in the [DWC]..., subject to judicial
review.”49
In Tex. Mut. Ins. Co. v. Ruttiger50 the Texas Supreme Court discussed the
significant changes the Legislature made to the Act in 1989.51 It noted that the
“amendments included significant reforms, among which were changes in how to
calculating benefits for injured workers, the amount of income benefits workers
could recover, the dispute resolution process, the addition of an ombudsman
program to provide assistance for injured workers who had disputes with insurers,
46 Subaru of Am. v. David McDavid Nissan, Inc., 84 S.W.3d 212, 221 (Tex. 2002)
47In Re Mid-Century Ins. Co. of Tex., 426 S.W.3d 169, 172 (Tex.App.—Houston [1st Dist.]
2012) (orig. proceeding)
48 See Rhule, 417 S.W.3d at 442 (citing Subaru, 84 S.W.3d at 221).
49 925 S.W.2d 607, 612 (Tex. 1996)
50 381 S.W.3d 430 (Tex. 2012).
51 The Ruttiger opinion addressed the viability of a common-law cause of action for breach
of the duty of good faith and fair dealing against a worker’s compensation carrier, a cause
of action previously approved of by the Texas Supreme Court in Arranda v. Ins. Co. of
North Amer., 748 S.W.2d 210 (Tex. 1988). The Ruttiger court held that the 1989
amendments to the Act manifested the Legislatures’ intent to vitiate the need for such a
cause of action and expressly overruled Arranda. Id., 381 S.W.3d at 438-56.
14
and increasing sanctions for violations of the Act.”52 The Ruttiger court stated that
“[t]he purpose of the Act is to provide employees with certainty that their medical
bills and lost wages will be covered if they are injured.” Id. at 441.
To accomplish these purposes, the Act provides detailed notice and
administrative dispute resolution proceedings that include specific
deadlines and incorporate a “conveyor-belt” approach. That is, once
the administrative dispute resolution process is initiated, a dispute
continues through the process until the dispute is resolved either by
the parties or by a binding decision through the resolution procedures.
Id. at 441.
The Ruttiger opinion provides a lengthy description of “the detailed notice
and administrative dispute resolution proceedings” encompassed by the Act. 53 In
describing the pervasiveness of the Act the Ruttiger court noted that the Act affords
the DWC significant power to enforce the Act against the various parties in the
worker’s compensation system. Id. The Ruttiger court concluded:
It is apparent that the Act prescribes detailed, WCD-supervised, time-
compressed processes for carriers to handle claims and for dispute
resolution. It has multiple, sometimes redundant but sometimes
additive, penalty and sanction provisions for enforcing compliance
with its requirements.54
The court recognized that allowing an employee to circumvent the act by asserting
common law causes of action would be “inconsistent with the Act’s goals and
legislative intent exhibited in the act” and could also “result in rewarding an
52 Id., 381 S.W.2d at 433.
53 Id. at 441-43.
54 Id. at 443.
15
employee who is dilatory in utilizing the Act’s detailed dispute resolution
procedures, regardless of whether the delay was intentional or inadvertent,
because whether and when the dispute resolution begins is by and large
dependent on the employee.” Id.
D. Real Party’s failure to exhaust his administrative remedies under the
Act precludes the trial court’s exercise of jurisdiction over this matter.
When an agency has exclusive jurisdiction a party must exhaust its
administrative remedies before seeking recourse through judicial review. 55 “If an
agency has exclusive jurisdiction... a party must first exhaust all administrative
remedies before a trial court has subject matter jurisdiction.”56 “Absent exhaustion
of administrative remedies, a trial court must dismiss the case.”57
1. Real Party consciously chose to circumvent the Act in pursuit of
common-law remedies for his work-place injury.
There is no question that Real Party not exhausted his administrative
remedies through the DWC. He readily admits this.58 Real Party claims that it is
55Rhule, 417 S.W.2d at 442 (citing Cash Am. Int’l., Inc. v. Bennett, 35 S.W.3d 12, 15
(Tex. 2000)).
56Cunningham Lindsey Claims Mgmt. v. Snyder, 291 S.W.3d 472, 477 (Tex.App.—
Houston [14th Dist.] 2009, pet. denied).
57Rhule, 417 S.W.2d at 442 (citing Tex. educ. Agency v. Cypress-Fairbanks I.S.D., 830
S.w.2d 88, 90 (Tex. 1992).
58 Tab 15, p. 18, ¶ 80. Real Party states:
In accordance with the Texas Labor Code Ch. 409, Plaintiffs did previously
file their DWC 41 form on the 1-year anniversary of the injury in question.
However, Plaintiffs did so solely to preserve their right to seek benefits in
the event that this Court or the Court of Appeals later determined that
iWorks Defendants and/or WM Defendants were workers’ compensation
subscribers. Plaintiffs are not seeking workers’ compensation benefits from
16
justified in foregoing the Texas Workers’ Compensation System because both
iWORKS and WM are nonsubscribers.59 However, an examination of the Plaintiff’s
allegations and the evidence submitted in connection with Relator’s Plea to the
Jurisdiction demonstrate that Relator was a subscriber the Act.
Real Party was injured on August 5, 2012.60 On August 30, 2012 he
executed a DWC-041 form61 requesting compensation for a work-related injury.62
On that form he stated that he was represented by Bradford J. Gilde (“Gilde”).63
Thus, fifteen days after his work-related injury (over 2 ½ years ago) Real Party was
at a minimum aware of the potential availability of benefits under the Act. It is also
fair to assume that his attorney knew (or had the ability to find out) how to obtain
those benefits.
Nearly a year later on August 12, 2013, Gilde sent a letter to the DWC.64 It
was styled as a “Notice, Stay, and Preservation Letter.” Although litigation was
ongoing and both iWORKS and Waste Management were represented by
any provider, and are surely not attempting to get blood from the turnip that
is iWorks Defendants’ cancelled policy.
59 Tab 2, Petition, p. 6, ¶¶ 19-20.
60 Id. at p. 13, ¶ 36.
61“Employee’s Claim for Compensation for a Work Related Injury or Occupational
Disease.”
62 Tab 10.
63 Id.
64 Tab 14.
17
counsel,65 neither Defendant was copied on this correspondence. Gilde attached
two separate DWC-041 forms to the letter. One names iWORKS as Real Party’s
employer and the other names WM as his employer. Thus, as of the date of his
letter to the DWC, Real Party’s counsel had actual knowledge of two separate
worker’s compensation policies which would potentially provide benefits to his
client. He consciously chose to forego pursuing his client’s benefits under either
one of the policies in lieu of proceeding with his claims in the trial court. 66
Gilde’s letter to the DWC states that it:
“is submitted: (1) as a notice of claim for compensation...as a
preservation of right to file and seek a claim for compensation...and
pursuant to Tex. Labor Code §409.004.”67
The letter further states that “this letter...is not an election or denial of a claim
for coverage.”68 Real Party cannot hedge his bets with the DWC while seeking a
judicial remedy in the trial court without first exhausting his administrative
65 At that time attorney Aric Garza was counsel for iWORKS.
66On information and belief, as of the filing of this petition Real Party has still not sought
benefits under WM’s worker’s compensation policy even though the trial court dismissed
his claims against WM pursuant to the “comp bar” defense.
Port Elevator-Brownsville, L.L.C. v. Casados, 358 S.W.3d 238 (Tex. 2012) held that for
purposes of the Act a temporary staffing company and its client are both co-employers
and that the client company cannot exclude or segregate temporary workers from its
worker’s compensation coverage. Simply put, the state of Texas wants all workers
covered. Thus, a temporary staffing employee typically has two different worker’s
compensation policies which can cover him for on-the-job injuries. Which policy actually
covers the worker is usually a matter of contract between the staffing company and its
client.
67 Tab 14 (emphasis in original).
68 Id.
18
remedies. His failure to do so in this matter, despite knowing the administrative
requirements set forth in the Act, deprives the trial court of subject-matter
jurisdiction over his claims.
Gilde’s letter to the DWC purports to reserve Real Party’s right to seek relief
from the DWC in the event he was unsuccessful in in the trial court. This approach
turns the purpose of the entire worker’s compensation system on its head. This
letter demonstrates that Real Party was well aware of the requirements under the
Texas Labor Code yet consciously chose to attempt to circumvent that process in
hopes of a common law verdict. This is not the public policy of Texas. As the
Ruttiger court observed, “the extra-statutory cause of action provides incentive for
an injured worker to delay using the avenues for immediate relief that the
Legislature painstakingly built into the law” and “distorts the balances struck in the
Act and frustrates the Legislature’s intent to have disputes resolved quickly and
objectively.”69
2. The laws embodied in the Act and the rules promulgated by the
DWC mandate that iWORKS policy was in effect on the date that
Real Party was injured at work.
iWORKS is a subscriber under the Act. iWORKS purchased a worker’s
compensation policy from Texas Mutual with the effective dates of 09/04/2011
through 09/04/2012.70 That iWORKS actually purchased this policy is not disputed
69 Ruttiger, 381 S.W.3d at 451.
70 Tab 6.
19
by Real Party. Rather, Real Party argues that the policy was terminated prior to
his August 5, 2012 injury.71 To support this claim he cites to a Notice of Dismissal
purportedly issued by Texas Mutual72 and discovery responses from Texas Mutual
and Lette Insurance Company, iWORKS’ insurance agent who procured the
policy.73
But it has long been ‘the settled policy of this State to construe liberally
the provisions of the [Act] in order to effectuate the purposes for which
it was enacted.’ Coverage is a fundamental purpose of the Act.74
Real Party’s contentions and the evidence offered to support them do not comport
with the statutory provisions provided for in the Act and only serve to thwart the
fundamental purpose of the Act, coverage.
71 Tab 15, p. 5-9, ¶¶ 28-39.
72 Id.
73 Id.
74Entergy Gulf States, Inc. v. Summers, 282 S.W.3d 433, 453 (Tex., 2009) (J. Hecht
concurring) (emphasis added) (quoting Huffman v. S. Underwriters, 133 Tex. 354, 128
S.W.2d 4, 6 (1939) (quoted in In re Poly-America, L.P., 262 S.W.3d 337, 350 (Tex. 2008)).
In support of his proposition that the Act has historically been interpreted by the courts as
broadly as possible so as to find coverage, Justice Hecht cites Citing Millers' Mut. Cas.
Co. v. Hoover, 235 S.W. 863, 864 (Tex. Comm'n App.1921, judgm't adopted) (“It has
been thought, inasmuch as the [Act] is in derogation of the common law, that it should be
given a strict construction, but the courts have very generally held that a spirit of liberality
should characterize its interpretations, for the reason that it is to be classed as remedial
legislation.” (quotation omitted)); Southern Sur. Co. v. Inabnit, 1 S.W.2d 412, 413-414
(Tex.Civ.App.-Eastland 1927, no writ) (“The leading authorities ... agree that Workmen's
Compensation Laws came into existence in response to a general acceptation of the
broad economic theory that industrial accidents should properly be chargeable as a part
of the overhead expenses of the industries. These laws are remedial in their nature, and
should be liberally construed with the view of promoting their objects. The early tendency
of our courts to construe them strictly because they were thought to be in derogation of
common law has long since given place to a liberal rule of construction. The rule now
prevailing prevents the restriction of the scope of the laws by exceptions and exact
definitions not in harmony with their spirit.”).
20
In 2005 the DWC was established as a division of the Texas Department
Insurance, replacing the abolished Texas Workers’ Compensation Commission.75
The DWC is administered by the commissioner of workers’ compensation who is
appointed by the governor for a two-year term.76 The Act gives the commissioner
authority to “adopt rules as necessary for the implementation and enforcement of
this sub-title [the Act].”77 These rules are codified in the Texas Administrative
Code.78 The Labor Code and the Texas Administrative Code (“TAC”) establish the
statutory and regulatory provisions by which an employer can elect to submit to
the Act by purchasing workers’ compensation insurance and, more importantly in
this case, the manner, effectiveness, and effect of the termination of workers’
compensation insurance by a carrier.
Under the Act an employer “may elect to obtain worker’s compensation
insurance coverage” and is thereby “subject to this subtitle [the Act].” 79 It is
undisputed that iWORKS elected to obtain workers’ compensation insurance
coverage and thereby subject itself to the Act. 80 iWORKS purchased a workers’
75 §402.001(b).
76 §402.00111; §402.00117.
77 §402.061; §402.00111
78See generally Title 28 Tex. Admin. Code, Part II. (“Texas Department of Insurance,
Division of Workers’ Compensation”).
79 §406.002.
80Even Plaintiff’s Petition states that “[a]s is clear, in addition to supplying client
companies with leased employees or temporary workers, IWORKS DEFENDANTS also
have the duty and responsibility to provide worker’s compensation.” Tab 2, p. 10, ¶ 24;
21
compensation policy from Texas Mutual effective 09/04/2011 through
09/04/2012.81 Luis Trevino, owner of iWORKS, testified that iWORKS subscribed
to worker’s compensation insurance from its inception and that this is the normal
course of business for a temporary staffing company. 82 Furthermore, the Service
Agreement between iWORKS and WM required that iWORKS carry workers’
compensation insurance.83 It is not Real Party’s contention that iWORKS was a
non-subscriber, rather, he contends that the Texas Mutual policy was cancelled
several weeks before his injury.84 As is discussed below, this contention is
unsupported by the Pleadings and the evidence.
In opposition to iWORKS’ Plea to the Jurisdiction, Real Party relied upon
four single-page documents85 as well as discovery responses from Texas Mutual
and Lette Insurance Company.86 The primary document he relies upon is a “Notice
of Termination.”87 However, this document has no probative value. There is no
but see Id., p. 6, ¶¶ 19-21 where Real Party makes the global allegation (without factual
support) that both iWORKS and WM are non-subscribers.
81 Tab 6.
82 Tab 11; Trevino testified: “Since it has been in business iWORKS has continuously
subscribed to Worker’s Compensation insurance and has covered all of its temporary
employees that it sends out on assignment. This is the standard course of business for
a temporary staffing company.”
83 Tab 3.
84 Tab 15, pp. 5-8, ¶¶ 25-32.
85 Real Party attached 560 pages of documents to his response (Tabs 16-18).
86Tabs 16 and 17. For the sake of simplicity, Relator has separated the evidence
specifically cited in Real Party’s response and has combined it under Tab 19 in the
Appendix.
87 Tab 19 The same document was produced by both Texas Mutual and Lette Ins.
22
evidence that this Notice was ever sent to iWORKS. Luis Trevino testified that
iWORKS never received notice of termination.88 He stated:
The first knowledge that iWORKS had of an alleged gap in its worker’s
compensation coverage was when Mose Guillory’s attorney made
that allegation during my deposition in this case. Although Guillory’s
attorney presented what appeared to be a notice of termination, I had
no knowledge of such notice. During that alleged period of time we
had never missed a premium payment, we had received no
communication from our broker regarding any termination, we had
received no denial of any claims, and we never had problems
obtaining Certificates of Insurance.
The testimony is uncontroverted. The notice relied upon by Real Party purports to
have been sent by certified mail which begs the question – where is the green card
or the unclaimed envelope?
The only other evidence offered by Real Party is the self-serving discovery
responses from Texas Mutual. Texas Mutual’s canned response to almost all of
the questions posed by Real Party (subject to objection) was:
Texas Mutual insurance policy no. STA_0001244473 301 10904
(“The Policy”) was issued to Preferred Staffing Company, LLC d/b/a
iWorks Personnel (“Preferred Staffing”) for the coverage period of
09/04/2011 to 09/04/2012. The Policy was cancelled, effective
07/16/2012 (See Notice of Cancellation, document Bates No.
TXM00318). Texas Mutual Insurance’s Company’s actions regarding
issuance of The Policy and subsequent cancellation were conducted
pursuant to and in accordance with the Rules set by the Texas
Department of Insurance Division of Workers’ Compensation and the
Texas Worker’s Compensation Act.89
88 Tab 11.
89 Tab 19.
23
Real Party also relies upon admissions submitted by Texas Mutual “admitting” that
1) the policy “was cancelled prior to August 5, 2012”, and 2) that “iWORKS was a
‘nonsubscriber,’ under Texas law to your [Texas Mutual’s] knowledge and
definition of “nonsubscriber.”90 Notwithstanding the fact that these admissions are
conclusory and lack any evidentiary foundation, these admissions have no
evidentiary value as they cannot be used against iWORKS.91
What Texas Mutual’s evidence does show is that iWORKS did indeed have
a policy covering the date of Real Party’s injury. What it does not show is any
evidence that the policy was properly terminated pursuant to the Labor Code and
the rules established by the DWC. Again, where is the green card? Where is the
unclaimed envelope? It is not in any of the documents submitted by Real Party.
Texas Mutual’s testimony also supports the exclusive jurisdiction of the DWC when
it claims that it has adhered to all of the requirements of the Act and the DWC rules
appurtenant thereto. It is solely within the DWC’s province to determine Texas
Mutual’s actual compliance and solely within the DWC’s administrative power to
punish and sanction Texas Mutual for violations of the Act and/or the DWC rules.
Real Party also referenced an August 24, 2012 letter written by Texas
Mutual to show cancellation of the policy.92 Again there is no evidence to show
90 Tab 19.
91Tex. Rule of Civ. P. 198.3; see U.S. Fid. & Guar. Co. v. Goudeau, 272 S.W.3d 603,
610 (Tex. 2008).
92 Tab 19.
24
that this was actually sent to iWORKS or that iWORKS ever received it. Nor is
there any mention of termination in this letter. However, the very next document
in Real Party’s exhibit does show that iWORKS paid Texas Mutual just under
$44,000.00 in premiums for that policy period.93
The only other document offered by Real Party in opposition to iWORKS
Plea to the Jurisdiction is an “Appointment Confirmation” dated October 18, 2012 94
that Real Party offered as proof that iWORKS “was in direct contact with Texas
Mutual during this cancellation period.”95 Notwithstanding the same issues of
delivery and receipt, this letter makes no mention of termination even though it is
dated over three months since the policy was supposed to have been cancelled.
The very next two documents in Real Party’s exhibit shows that on November 12,
2012 a copy of an “Incomplete Final Audit Notification” allegedly sent to iWORKS96
was also faxed to Lette Insurance. What is interesting about this document is that
it states
To prevent cancellation of your current coverage, please contact the
Premium Audit department promptly.97
93 Tab 20.
94 Tab 19.
95 Tab 15, p. 9, ¶ 38.
96Tab 21; Again, Real Party provides no evidence that this letter was actually sent to or
received by iWORKS.
97 Id.
25
This begs the question, if iWORKS’ coverage was terminated in July, 2012, how
could its current coverage in November, 2012 be subject to cancellation? This
court, looking at this evidence de novo, should find that the evidence submitted by
Real Party to show the trial court’s jurisdiction in this matter is of no probative effect
at all. However, even had the trial court (or this Court) given any weight to the
evidence submitted by Real Party, the laws of the Act and the Rules of the DWC
still confer exclusive jurisdiction to the DWC.
The Act and the rules enacted by the DWC have very specific requirements
governing the termination of a workers’ compensation policy. The Act provides that
an insurance company that terminates a policy “shall deliver notice of the
cancellation... by certified mail or in person to the employer and the division” at
least thirty days prior to the effective date of the cancellation. 98 If the insurance
company does not give notice as required, then the policy is extended until proper
notice is provided.99
Pursuant to the rule making authority given to it in the Act, the DWC has
promulgated additional rules for the termination of a worker’s compensation policy
which are codified in the TAC.100 Chapter 43 provides that “[r]ejection of the
workers’ compensation system [o]ccurs when a subscriber terminates coverage or
98 §406.008.
99 Id.
100 See 28 TEX. ADMIN. CODE, Chapter 43.
26
fails or refuses to purchase a policy of workers’ compensation insurance.”101 Thus,
there is no allegation that iWORKS “rejected” the workers’ compensation system.
Under the DWC’s rules a carrier must give the employer written notice of
termination at least thirty days before the effective date of termination. 102 Notice
must be by certified mail; there is no provision for personal delivery.103 The
effective date of the termination under Chapter 43 is “the latest of the following
dates: (A) on the 31st day after the carrier notifies the subscriber as provided in
subsection (c) . . . ; (B) the day the carrier files notice of termination with the board
. . .; or (C) the actual termination date recited on the notice.”104
Chapter 110 provides substantially more protection for both the employer
and the employee. It provides that:
f) Cancellation or non-renewal of a workers' compensation insurance
policy by an insurance company takes effect on the later of:
(1) the end of the workers' compensation insurance policy period; or
(2) the date the division and the employer receive the notification
from the insurance company of coverage cancellation or non-
renewal and the later of:
(A) the date 30 days after receipt of the notice required by
Labor Code, §406.008(a)(1);
(B) the date 10 days after receipt of the notice required by
Labor Code, §406.008(a)(2); or
101 Id., § 43.10(a)(2).
102 Id., § 43.10(c)(1-3)
103 Id.
104 Id., § 43.10(d)(1)
27
(C) the effective date of the cancellation if later than the date
in paragraph (1) or (2) of this subsection.105
The rules promulgated by the DWC and codified in the TAC reflect the driving
intent of the State of Texas that its workers be covered.
How do these laws and regulations apply in this case? Under Rule 110.1,
regardless of when or how or if iWORKS was provided with notice of cancellation
by Texas Mutual, the effective date of termination would be at the end of the policy
period on September 4, 2012. Under Rule 43.10 the effective date of termination
would be on the 31st day after iWORKS received notice of cancellation from Texas
Mutual through certified mail. Under Section 408.10, the termination date is
extended until Texas Mutual provides notice of cancellation to iWORKS through
either certified mail or personal delivery. Since iWORKS never received notice of
cancellation through certified mail, under both Rule 43.10 and Section 408.10 the
policy terminated under its own terms on September 4, 2012. Real Party was
injured on August 5, 2012. Thus he falls under the coverage of iWORKS’ workers’
compensation policy.
105 Id., § 110.1(f) (emphasis added).
28
E. The DWC has exclusive jurisdiction to determine coverage.
The DWC routinely addresses the issues raised in this case through its
administrative proceedings.106 For example, in Appeals Panel No. 030660 107
(Division of Worker’s Compensation, April 28, 2003) the DWC appeals panel
addressed a temporary staffing situation and determined which employer was
liable, the proper application of the Staff Leasing Services Act108 (“SLSA”), and
approved the use of the borrowed servant doctrine in determining liability.
In Appeals Panel No. 021771 (Division of Worker’s Compensation,
September 3, 2002) the appeals panel addressed a matter factually similar to this
case analyzing the interplay between the contractual obligations between a staffing
106
See e.g. Ins. Co. of Pa. v. Hartford Underwriters Ins. Co., 164 S.W.3d 747 (Tex.App.—
Houston [14th Dist.] 2005, no pet.) (“Though we are not bound by the decisions [of the
DWC], we find them instructive . . . . “); Houston Gen. Ins. Co. v. Ass’n Cas. ins. Co., 977
S.W.3d 634, 636 (Tex.App.—Tyler 1998, no pet.) (noting that administrative decisions,
while not binding, are entitled to substantial weight).
DWC Appeals Panel decisions are available on the Texas Department of Insurance
website at http://www.tdi.texas.gov/appeals. Copies of the Appeals Panel decisions cited
herein are found in the Appendix at Tab 22.
107 Tab 22.
108 TEX. LABOR CODE, Chapter 91 (“STAFF LEASING SERVICES”). The Texas Legislature
amended Chapter 91 in 2013 renaming it “PROFESSIONAL EMPLOYMENT ORGANIZATIONS”.
This amendment supports iWORKS’ opposition to Real Party’s continuing assertion that
iWORKS is a staff leasing company. Rather, iWORKS temporary employment service as
set forth in Chapter 93 of the TEXAS LABOR CODE. Furthermore, effective September 1,
2013, TEX. LABOR CODE § 93.004(a) holds that a Certificate of Insurance “constitutes proof
of workers’ compensation insurance coverage for the temporary employment service and
the client of the temporary employment service with respect to all employees of the
temporary employment services assigned to the client.” Subsection (a) further holds that
“[t]he state or political subdivision of the state shall accept a certificate of insurance
coverage described by this section as proof of worker’s compensation coverage under
Chapter 406.”
29
company and its client company, the applicability of the SLSA, and the application
of the borrowed servant doctrine to determine coverage. The appeals panel upheld
the hearing officer’s determination that the client company was responsible for the
worker’s injury rather than the staffing company. The panel held that:
Texas courts have recognized that a general employee of one
employer may become the borrowed servant of another employer.
The determinative question then becomes which employer had the
right of control of the details and manner in which the employee
performed the necessary services. Carr v. Carroll Company, 646
S.W.2d 561 (Tex. App.-Dallas 1982, writ ref'd n.r.e.). We note that in
Texas Workers’ Compensation Insurance Fund v. DEL Industrial, Inc.,
35 S.W.3d 591 (Tex. 2000), the court held that the Staff Services
Leasing Act (SSLA), Texas Labor Code Chapter 91, supersedes the
common law right-of-control test in determining employer status of
leased employees for workers’ compensation purposes. However,
(Employer 2) was not licensed under the SSLA. The hearing officer
determined that on the date of injury, (Employer 2) was a licensed
provider of temporary common workers under Chapter 92 of the
Texas Labor Code, entitled Temporary Common Worker Employers
(TCWE). In Richmond v. L. D. Brinkman & Co. (Texas) Inc., 36 S.W.3d
903 (Tex. App.-Dallas 2001, pet. denied), the court determined that
the common law right-of-control test is not superseded by Chapter 92
(TCWE) of the Texas Labor Code. The hearing officer is the sole
judge of the weight and credibility of the evidence. Section 410.165(a).
We conclude that the hearing officer did not err in applying the right-
of-control test and in determining that at the time of the injury, the
claimant was the borrowed servant of (Employer 1). The hearing
officer’s decision is supported by sufficient evidence and is not so
against the great weight and preponderance of the evidence as to be
clearly wrong and unjust. Cain v. Bain, 709 S.W.2d 175 (Tex. 1986).
Id. at p. 1-2. The client company also argued that the staffing company should be
responsible because the client company paid fees to the staffing company which
went towards worker’s compensation coverage for the temporary employees. The
panel rejected these arguments. Id.
30
In Appeals Panel No. 101718 (Division of Worker’s Compensation, March
21, 2011) the appeals panel examined a complex claim involving a contractor, a
subcontractor, a PEO, and a temporary staffing company. In finding that the
employee did not suffer a compensable injury the panel had to address issues
related to coverage (including whether or not the temporary staffing company’s
carrier properly terminated coverage), contractual duties between the parties,
liability issues between three different worker’s compensation insurance providers,
employment status of the claimant, and other related issues.
The legal issues discussed above are all issues that are in play in this case.
These are issues that the DWC routinely addresses through its administration of
the Act. These are issues that fall squarely within the exclusive jurisdiction of the
DWC. The trial court does not have subject-matter jurisdiction over these matters
until all of the administrative remedies available through the Act have been
exhausted in the same manner as demonstrated in the DWC opinions cited above.
In Morales v. Liberty Mut. Sinc. Co.,109 the Texas Supreme Court addressed
the issue of the relationship between compensability under the Texas Worker’s
Compensation Act (“the Act”), employee status, and subscriber status.110 The
109 241 S.W.3d 514 (Tex. 2007).
110 The Morales Court addressed these issues in the context of determining which
standard of review set forth in the Act should apply to judicial review of a final decision
from a DWC appeals panel. If the issues being appealed involve “compensability” then
the standard of review is the “modified de novo” standard established by §410.301. Issues
that do not address compensability are reviewed under a “substantial-evidence” standard.
31
Court held that issues of coverage such as the one in this case fall within the rubric
of the existence of a compensable injury which is properly resolved through the
Act. Morales was killed while repairing a roof on a motel.111 His wife sought death-
benefits under the act claiming he was injured while in the course and scope of his
employment with three different employers.112 Two of the employers were insured
under separate worker’s compensation policies, and the third was a
nonsubscriber.113 The court explained that:
The existence of a compensable injury is the threshold requirement
for payment of benefits under the Act. See TEX. LAB.CODE §§
401.011(5), 406.031(a). And there are various elements that affect
whether an injury is compensable, including the worker's employment
status as an employee or independent contractor at the time of injury,
whether the worker was injured in the course and scope of
employment, who controlled the employee's work when the injury
occurred, and whether a particular employer has an insurance policy
in effect. See id. §§ 401.011(12), (18), 401.012(a).
....
A dispute about any of these elements regards “compensability or
eligibility for . . . benefits” and is subject to judicial review under section
410.301.114
In In Re Tex. Mut. Ins. Co.115 the court addressed the DWC’s exclusive
jurisdiction in the context of common law breach of contract claims and disputed
Morales, 241 at 516-17. The outcome of this question of compensability also effects
venue and the appropriate scope of judicial review. Id.
111 Id. at 515.
112 Id.
113 Id.
114 Id. at 519.
115 157 S.W.3d 75 (Tex.App.—Austin 2004, orig. proceeding).
32
coverage. The Court held that the Fodge decision mandated that the claimant’s
breach-of-contract claim “is within the Commission’s exclusive jurisdiction.”116 The
Court also held that:
We likewise reject [Claimant’s] assertions that the Commission’s
exclusive jurisdiction over worker’s compensation benefits claims
does not extend to determining whether coverage existed at the time
of [Claimant’s] injury. The legislature has granted the Commission
exclusive jurisdiction over claims for policy benefits. Fodge, 63
S.W.3d at 805. In adjudicating such claims, the Commission will
necessarily have to interpret compensation policies and determine the
period in which coverage existed. Indeed, it appears to routinely do
so. See, e.g., Gonzales v. Cigna Ins. Co. of Tex, 924 S.W.2d 183,
184-87 (Tex.App.—San Antonio 1996, write denied); Houston Gen.
Ins. Co. v. Association Cas. Ins. Co., 972 S.W.2d 634, 636
(Tex.App.—Tyler 1998, no pet.).
Moreover, [Claimant’s] argument would imply that whenever the
Commission, in the exercise of its exclusive jurisdiction, encounters a
coverage issue that can be characterized as going to "policy
formation," the agency must abate its proceedings pending judicial
resolution of the "formation" issue. We doubt that the legislature, in
conferring exclusive jurisdiction upon the Commission to determine
compensation benefits claims, intended such an absurd result that
seemingly turns traditional concepts of exclusive jurisdiction on their
head.117
116 Id. at 80.
117 Id.
33
F. The newly released Crawford opinion confirms the Court’s prior
findings that it is the intent of the legislature that the DWC have
exclusive jurisdiction out of work-place injury claims and that even
artful pleadings will not let Plaintiff’s recast their claims outside of the
purview of the Act.
One week after the trial court denied iWORKS’ plea, the Texas Supreme
Court issued its opinion in In Re Crawford & Co.118 The Supreme Court held that
the DWC has exclusive jurisdiction over the Plaintiff’s claims and that the Act
provided the exclusive remedies, even over plaintiff’s common law claims. The
Crawford Court reversed the Amarillo Court of Appeals and dismissed the
Plaintiff’s district court claims.
The Crawford opinion both clarifies and expands the Supreme Court’s
holding in Ruttiger.119 In Crawford the Plaintiff sued his employer’s worker’s
compensation carrier alleging that it improperly denied him benefits from a 1998
injury. He argued that the carrier engaged in conduct that gave rise to liability
independent from and unrelated to worker’s compensation and, thus, did not fall
under the exclusive jurisdiction of the DWC. The Supreme Court rejected this
argument. The critical distinction between this case and Crawford is that the
Crawford plaintiff had already invoked the DWC’s jurisdiction, while the Real Party
has refused to invoke the DWC’s jurisdiction claiming that Relator is a non-
118No. 14-0256 (Tex. February 27, 2015) (per curiam) (a copy is attached to the Appendix
at Tab 23).
119“We agree with Crawford that the court of appeals read Ruttiger too narrowly.”
Crawford at p. 7.
34
subscriber under the Texas Labor Code. However, the seminal messages from
the Texas Supreme Court in Crawford are equally commanding in this case.
The first seminal message from Crawford is that it is the clearly established
intent of the legislature “that the current Act with its definitions, detailed
procedures, and dispute resolution processes” be the exclusive remedy for work-
place injuries, and, moreover, that this “demonstrates legislative intent for there to
be no alternative remedies.”120 The Court observed that:
The Act designates the Department of Insurance as the administrative
agency responsible “[for overseeing] the workers’ compensation
system of this state” and establishes the Division of Workers’
Compensation within the Department to “administer and operate” that
system. TEX. LAB. CODE § 402.001. It is the Division’s duty to “(1)
regulate and administer the business of workers’ compensation in this
state; and (2) ensure that [the Act] and other laws regarding workers’
compensation are executed.” Id. § 402.00114. The Division must
monitor insurance carriers, employers, and others “for compliance
with commissioner rules, this subtitle, and other laws relating to
workers’ compensation.” Id. § 414.002(a). The Division or its
commissioner may impose an array of sanctions against those who
fail to comply, including a cease-and-desist order and administrative
penalties up to $25,000 per day per occurrence. Id. § 415.021(a). As
we explained in Ruttiger, the Act, as substantially revised in 1989,
“prescribes detailed, [Division]supervised, time-compressed
processes for carriers to handle claims and for dispute resolution” and
“has multiple, sometimes redundant but sometimes additive, penalty
and sanction provisions for enforcing compliance with its
requirements.” 381 S.W.3d at 443121.
120 Crawford at p. 9 (quotes and citations omitted).
121 Crawford at p. 4.
35
Thus, the broad scope and powerful enforcement provisions provided to the DWC
by the 1989 revisions to the Act evince the legislature’s unequivocal intent that the
DWC be the forum for which work-place injuries are resolved.
The second seminal message from Crawford is that it is the substance of
the claims and not the label of the cause of action asserted which determines the
exclusively jurisdiction of the DWC.
Whether the Act provides the exclusive process and remedies,
therefore, does not depend on the label of the cause of action
asserted. As we have often explained, claimants may not recast
claims to avoid statutory requirements or to qualify for statutory
protections. [citations omitted] Instead, in assessing whether a claim
falls within the Division’s exclusive jurisdiction, courts must look at the
substance of the claim.122
Thus, Real Party’s creative and questionable assertion of causes of action
putatively beyond the scope of the Act are of no consequence. The substance of
this claim is that Real Party was injured at work and is seeking damages for those
injuries. The Crawford opinion and its predecessors hold that resolution of these
claims falls under the exclusive jurisdiction of the DWC. Therefore, the trial court
cannot exercise its jurisdiction in this matter until Real Party has exhausted his
administrative remedies. If is fundamental error for it to do so.
The crux of Real Party’s adamant disavowal of the DWC’s exclusive
jurisdiction is twofold. First is its contention that iWORKS is a non-subscriber. By
making this assertion Real Party not only seeks access to the potentially much
122 Crawford at p. 8.
36
greater recovery provided by common law remedies, but he also seeks the tactical
advantage conferred by the Act which would strip away most if Relator’s common-
law affirmative defenses, particularly contributory negligence.123 Second is the fact
that Real Party tested positive for marijuana immediately following his work-place
injury. The Act provides that an employee that tests positive for marijuana is
presumed intoxicated and that the burden is on that employee to rebut that
presumption.124 The Act further provides that an employee is not entitled to benefits
under the Act if the injury occurred while he was intoxicated. 125 Thus, Real Party
has an incredibly strong incentive to avoid the DWC at all costs, both on the upside
(potentially greater remedies) and on the downside (denial of benefits due to
intoxication). “[P]arties cannot avoid exhaustion of administrative remedies
because they fear they might not prevail.” In Re Liberty Mut. Fire Ins. Co., 295
S.W.3d 327 329 (Tex. 2009).
VIII. Conclusion
This Court should grant Relator’s request for mandamus relief and dismiss
Real Party’s claims. The trial court does not have subject matter jurisdiction. The
Legislature has made clear through the Act that the DWC has exclusive jurisdiction
over Real Party’s claims and that Real Party must exhaust all of his administrative
123 § 406.033 (a).
124 § 401.013(c).
125 § 406.032(1)(A).
37
remedies as set forth in the Act. Real Party has intentionally tried to circumvent
the act by recasting his work-place injury claims under various common law tort
and contract claims. He has done this in the hope of obtaining more generous
common law remedies and out of fear that he will not prevail in the administrative
proceedings due to his presumed intoxication. Creative pleadings notwithstanding,
Real Party’s failure to exhaust his administrative remedies through the DWC
precludes the trial court from exercising subject matter jurisdiction. The trial court
erred by doing so.
Real Party’s contention that Relator is a nonsubscriber also has no merit. It
is not supported by the pleadings and the evidence offered to the trial court. Even
if the trial court had taken Real Party’s unsupported claims as true, the Labor Code
and the Administrative Act both mandate as a matter of law that Relator’s policy
was in effect at the time of Real Party’s on-the-job injury. The Texas Supreme
Court has made abundantly clear from Ruttiger through Crawford that it is the
public policy of the State of Texas that the Act be interpreted so as to provide
coverage. Furthermore, in this matter the question of whether or not Texas Mutual
properly terminated Relator’s policy goes to compensability and is something that
the DWC resolves on a regular basis. Thus, it has no impact on the DWC’s
exclusive jurisdiction and, rather, further compels such jurisdiction.
38
IX. Prayer
Relator asks this Court to grant this petition for mandamus relief and dismiss
Real Party’s claims for lack of jurisdiction.
Respectfully submitted,
/s/ David N. Anderson
DAVID N. ANDERSON
TBN: 00797951
THE ANDERSON LAW FIRM
4309 Yoakum
Houston, TX 77006
(713) 521-6563 - Telephone
(888) 824-5624 – Fax
danderson@lodna.net
ATTORNEY FOR DEFENDANTS
IWORKS PERSONNEL, INC.,
LUIS TREVINO, and
HAYDEE GUTIERREZ
39
Certificate of Service
As required by Texas Rule of Appellate Procedure 6.3 and 9.5(b), (d), (e),
and 52.7(c), I certify that on March 13, 2015 I have served this Petition for Writ of
Mandamus on all other parties listed below through the Texas eFile system as
follows:
The Honorable Michael Landrum
113th Judicial District Court
Harris County Civil Courthouse
201 Caroline, 10th Floor
Houston, TX 77002
Respondent
Bradford J. Gilde
Texas Bar No. 24045941
bjg@gildelawfirm.com
GILDE LAW FIRM
55 Waugh, Suite 850
Houston, TX 77007
Counsel for Real Parties in Interest
Mose Guillory and Mary Guillory
B. Lee Wertz, Jr.
Texas Bar No. 00797796
lwertz@munsch.com
MUNSCH, HARDT, KOPF, AND HARR, P.C
700 Milam Street, Suite 2700
Houston, Texas 77002-2806
Counsel for Defendant, Waste Management, Inc.
__/s/ David N. Anderson______________
David N. Anderson
40
Appendix
Tab 1 – Order denying iWORKS’ Plea to the Jurisdiction
Tab 2 – Plaintiff’s Fifth Amended Petition
Tab 3 – Master Service Agreement
Tab 4 – Hold Harmless Agreement
Tab 5 – iWORKS’ Plea to the Jurisdiction
Tab 6 – iWORKS’ WC Policy
Tab 7 – Waste Management’s WC Policy
Tab 8 – Employer’s First Report of Injury or Illness (DWC-001)
Tab 9 – Hold Harmless Agreement
Tab 10 – Employee’s Claim for Compensation (DWC-041)
Tab 11 – Affidavit of Luis Trevino
Tab 12 – iWORKS’ Supplemental Plea to the Jurisdiction
Tab 13 – Texas Mutual’s Receipt of Claim
Tab 14 – Gilde’s Correspondence to DWC and Employee’s Notice of Claim
Tab 15 – Plaintiffs’ Response to iWORKS’ Plea to the Jurisdiction
Tab 16 – Texas Mutual Insurance Discovery Responses
Tab 17 – Lette Insurance Company Discovery Responses
Tab 18 – Master Service Agreement (incomplete copy of Tab 2)
Tab 19 – Documents cited in Plaintiff’s Response
Tab 20 – Final Audit Statement
Tab 21 – Incomplete Final Audit Notification
Tab 22 – DWC Review Board Decisions
42
Tab 23 – In Re Crawford, No. 14-0256 (Tex. February 27, 2015) (per curiam)
Tab 24 – Texas Administrative Code Rule 43.10 and 110.1
Tab 25 – TEXAS LABOR CODE, Chapter 401
Tab 26 – TEXAS LABOR CODE, Chapter 402
Tab 27 – TEXAS LABOR CODE, Chapter 406
Tab 28 – TEXAS LABOR CODE, Chapter 408
Tab 29 – TEXAS LABOR CODE, Chapter 409
Tab 30 – TEXAS LABOR CODE, Chapter 410
Tab 31 – TEXAS LABOR CODE, Chapter 414
Tab 32 – TEXAS LABOR CODE, Chapter 415
43
CAUSE
NO.
2012-­‐61407
MOSE
A.
GUILLORY
and
§
IN
THE
DISTRICT
COURT
MARY
GUILLORY,
§
Plaintiffs
§
§
v.
§
OF
HARRIS
COUNTY,
TEXAS
§
IWORKS
PERSONNEL,
INC.;
§
WASTE
MANAGEMENT,
INC.;
§
WASTE
MANAGEMENT
OF
TEXAS,
INC.;
§
WM
RECYCLE
AMERICA,
LLC;
§
LUIS
TREVINO;
and
§
HAYDEE
GUTIERREZ.
§
Defendants.
§
113
JUDICIAL
DISTRICT
th
PLAINTIFFS’
FIFTH
AMENDED
PETITION
&
REQUESTS
FOR
DISCLOSURE
I. INTRODUCTION
“Few
problems
in
the
law
have
given
greater
variety
of
application
and
conflict
in
results
than
the
cases
arising
in
the
borderland
between
what
is
clearly
an
employer-­‐employee
relationship
and
what
is
clearly
one
of
independent,
entrepreneurial
dealing.”
See
NLRB
v.
Hearst
Publ’ns,
Inc.,
322
U.S.
111,
121
(1944)
(quoting
U.S.
Supreme
Court
Justice
Wiley
Blount
Rutledge).
1. Plaintiffs
MOSE
A.
GUILLORY
and
MARY
GUILLORY
(hereinafter
collectively
referred
to
as
“PLAINTIFFS”),
complain
of
the
above-­‐named
Defendants’,
IWORKS
PERSONNEL,
INC.;
LUIS
TREVINO;
and
HAYDEE
GUTIERREZ;
(hereinafter
collectively
referred
to
as
“IWORKS”
or
“IWORKS
DEFENDANTS”);
and
WASTE
MANAGEMENT,
INC.;
WASTE
MANAGEMENT
OF
TEXAS,
INC.;
WM
RECYCLE
AMERICA,
LLC
(hereinafter
collectively
referred
to
as
“WM”
or
“WM
DEFENDANTS”)
incompetence,
inter
alia,
which
incompetence
proximately
caused
Plaintiff
Mose
Guillory’s
injuries
and
PLAINTIFFS’
damages
–
to
wit:
IWORKS
was
an
incompetent
employer/entity
when
it
failed
to
subscribe
to
Texas
Workers
Compensation
Insurance
Coverage
for
Plaintiff
Mose
Guillory
and
was
incompetent
when
it
failed
to
train
Plaintiff
Mose
Guillory.
WM,
as
confirmed
by
OSHA,
was
an
equally
incompetent
employer/entity
who
PLAINTIFFS’
FIFTH
AMENDED
PETITION
&
REQUESTS
FOR
DISCLOSURE
1
likewise
failed
to
train
Plaintiff
Mose
Guillory
and
was
an
incompetent
employer/entity
when
it
failed
to
ensure
Texas
Workers
Compensation
Insurance
Coverage
for
Plaintiff
Mose
Guillory,
by
virtue
of
its
Staff
Leasing
Agreement
with
IWORKS.
2. U.S.
Supreme
Court
Justice
Wiley
Blount
Rutledge’s
“borderland”
of
liability
is
evidenced
in
the
legal
issues
involved
in
this
case
that
include
Contract
Law,
Employment
Law,
and
Tort
Law.
Defendants
architected
this
“borderland”
of
liability
through
their
contractual
agreements
in
an
effort
to
skirt
around
employment
obligations
that
ultimately
resulted
in
the
conduct
that
proximately
caused
PLAINTIFFS’
injuries
and
damages.
That
is,
Defendants’
contractual
agreements
were
designed
to
obscure
employment
responsibility
thereby
setting
the
stage
for
work-­‐related
accidents
without
civil
redress
to
the
victims
(Plaintiffs
herein)
and
resulting
in
an
economic
windfall
to
the
victimizer
(Defendants
herein).
3. This
is
not
a
simple
case
of
who
has
coverage
–
the
holder
of
which
entitles
that
party
or
all
parties
to
a
comp-­‐bar
defense.
Rather
and
unfortunately,
it
is
a
complicated
case.
IWORKS
Defendants
would
have
this
Court
and
our
jury
believe
that
it
is
not
responsible
for
obtaining
workers
compensation
coverage
and
not
responsible
for
training
its
leased
employees
by
virtue
of
a
contract
with
WM
Defendants
–
absolving
IWORKS
Defendants
of
any
and
all
liability.
WM
Defendants
would
have
this
Court
and
our
jury
believe
that
its
workers
compensation
coverage
policy
entitles
it
to
a
comp-­‐bar
defense
–
absolving
WM
Defendants
of
civil
liability
in
the
present
action,
so
that
WM
Defendants
can
later
deny
workers
compensation
coverage
by
pointing
to
IWORKS
Defendants’
obligation
to
secure
same
by
virtue
of
a
contract
with
IWORKS
Defendants
in
a
subsequent
action
–
absolving
WM
Defendants
of
any
and
all
liability.
4. Based
on
Defendants’
incompetence,
inter
alia,
PLAINTIFFS
hereby
bring
this
their
latest
live
pleading
and
would
respectfully
show
unto
this
honorable
Court
the
following:
PLAINTIFFS’
FIFTH
AMENDED
PETITION
&
REQUESTS
FOR
DISCLOSURE
2
II. DISCOVERY
CONTROL
PLAN
5. PLAINTIFFS
intend
to
conduct
discovery
under
Level
3
of
Texas
Rule
of
Civil
Procedure
190.4.
Given
the
introduction
of
SEATON,
L.L.C.’S
(d/b/a
STAFF
MANAGEMENT),
Defendants’
dispositive
motion
practice,
and
other
issues
concerning
discovery,
PLAINTIFFS
have
requested
discovery
under
Level
3
and
have
submitted
to
the
Court
Plaintiffs’
Proposed
Docket
Control
Order.
III. PARTIES
6. Plaintiff
MOSE
A.
GUILLORY,
an
individual,
is
a
resident
and
citizen
of
Fort
Bend
County,
Texas.
7. Plaintiff
MARY
GUILLORY,
an
individual,
is
the
wife
of
MOSE
A.
GUILLORY
and
is
a
resident
and
citizen
of
Fort
Bend
County,
Texas.
8. Defendant
IWORKS
PERSONNEL,
INC.
purports
to
be
a
Texas
corporation
organized
and
existing
under
the
laws
of
the
state
of
Texas,
whose
principal
office
is
P.O.
Box
100111,
San
Antonio,
Bexar
County,
Texas
78201-­‐1411.
Defendant
IWORKS
PERSONNEL,
INC.
has
filed
its
Answer
and
appeared
herein.
9. Defendant
WASTE
MANAGEMENT,
INC.
is
a
Texas
corporation
organized
and
existing
under
the
laws
of
the
state
of
Texas,
whose
principal
office
is
1001
Fannin,
Suite
4000,
Houston,
Harris
County,
Texas
77002.
Defendant
WASTE
MANAGEMENT,
INC.
has
filed
its
Answer
and
appeared
herein.
10. Defendant
WASTE
MANAGEMENT
OF
TEXAS,
INC.
is
a
Texas
corporation
organized
and
existing
under
the
laws
of
the
state
of
Texas,
whose
principal
office
is
1001
Fannin,
Suite
4000,
Houston,
Harris
County,
Texas
77002.
Defendant
WASTE
MANAGEMENT
OF
TEXAS,
INC.
has
filed
its
Answer
and
appeared
herein.
11. Defendant
WM
RECYCLE
AMERICA,
LLC
is
a
Texas
corporation
organized
and
existing
under
the
laws
of
the
state
of
Texas,
whose
principal
office
is
1001
Fannin,
Suite
4000,
Houston,
Harris
County,
Texas
77002.
Defendant
WM
RECYCLE
AMERICA,
LLC
has
filed
its
Answer
and
appeared
herein.
PLAINTIFFS’
FIFTH
AMENDED
PETITION
&
REQUESTS
FOR
DISCLOSURE
3
12. Defendant
LUIS
TREVINO,
an
individual,
may
be
served
with
process
at
Defendant’s
usual
place
of
abode,
217
Country
Meadow
Dr.,
Boerne,
Kendall
County,
Texas
78006.
Defendant
LUIS
TREVINO
has
filed
his
Answer
and
appeared
herein.
13. Defendant
HAYDEE
GUTIERREZ,
and
individual,
may
be
serve
with
process
at
Defendants’
usual
place
of
business,
IWORKS
PERSONNEL,
INC.,
6653
San
Pedro
Ave,
San
Antonio,
Bexar
County,
Texas
78216.
Defendant
HAYDEE
GUTIERREZ
has
filed
her
Answer
and
appeared
herein.
IV. JURISDICTION
14. This
Court
has
jurisdiction
over
the
lawsuit
because
the
District
Court’s
jurisdiction
begins
at
$500
and
has
no
upper
limits.
The
amount
in
controversy
in
this
case
is
within
the
jurisdictional
limits
of
this
court.
In
addition,
this
Court
has
jurisdiction
over
Defendants
because
Defendants
purposefully
availed
themselves
of
the
privileges
and
benefits
of
conducting
business
in
Texas
by
engaging
in
business
in
the
State
of
Texas.
Finally,
this
Court
has
jurisdiction
over
Defendants
because
Defendants
committed
torts
in
whole
or
in
part
in
Texas,
which
torts
are
the
subject
of
this
suit
and
which
are
set
forth
more
fully
below.
V. VENUE
15. Venue
is
proper
in
Harris
County,
Texas
under
Texas
Civil
Practice
&
Remedies
Code
section
15.002
because
all
or
a
substantial
part
of
the
events
or
omissions
giving
rise
to
this
suit
occurred
in
Harris
County,
Texas.
See
TEX.
CIV.
PRAC.
&
REM.
CODE
§15.002(a)(1).
That
is,
PLAINTIFFS’
injuries
and
damages
were
caused
by
Defendants’
actions
and/or
inactions
that
arose
out
of
an
incident
that
occurred
at
4939
Gasmer
Dr.,
Houston,
Harris
County,
Texas
77035.
Venue
is
proper
in
Harris
County,
Texas
under
Texas
Civil
Practice
&
Remedies
Code
section
15.002
because
one
or
more
defendant
corporations
maintain
its
principal
office
in
Harris
County,
Texas.
See
Tex.
Civ.
Prac.
&
Rem.
Code
§15.002(a)(3).
Finally,
venue
in
Harris
County,
Texas
is
proper
pursuant
to
§15.002
because
the
venue
facts
show
the
PLAINTIFFS’
FIFTH
AMENDED
PETITION
&
REQUESTS
FOR
DISCLOSURE
4
convenience
of
the
parties,
witnesses,
and
in
the
interest
of
justice,
Harris
County,
Texas
is
proper
venue.
Maintenance
of
this
action
in
Harris
County,
Texas
would
not
work
an
injustice
to
any
party
and
the
balanced
interests
of
all
parties
predominate
in
favor
of
the
action
being
brought
within
Harris
County,
Texas.
VI. NO
BASIS
FOR
REMOVAL
16. There
is
no
basis
for
removal
of
this
case
to
federal
court.
There
is
no
federal
question
at
issue
pursuant
to
28
U.S.C.
§1441(b).
There
is
no
total
diversity
of
citizenship
pursuant
to
28
U.S.C.
§1441
and
28
U.S.C.
§1332,
because
one
or
more
of
the
Defendants
is
a
citizen
of
the
state
of
Texas.
See
28
U.S.C.
§1441(b),
§1332(c).
PLAINTIFFS
are
not
asserting
any
claims
against
any
Defendant
whom
was
acting
as/under
any
officer
of
the
United
States
or
any
such
agency
thereof,
or
person
acting
under
him,
or
for
any
act
under
color
of
such
office,
or
against
any
Defendant
during
a
time
period
when
this
facility
was
a
federal
enclave.
Accordingly,
there
is
no
basis
for
removal
of
this
case
to
federal
court,
and
any
attempt
to
do
so
by
any
Defendant
will
be
met
with
an
immediate
motion
to
remand
and
a
motion
for
sanctions.
VII. EXHIBITS
17. PLAINTIFFS
hereby
incorporate
by
reference,
as
though
set
forth
fully
herein,
the
following
attached
exhibits
–
to
wit:
• EXHIBIT
A:
WM
DEFENDANTS’
Master
Agreement
• EXHIBIT
B:
Heavy
Equipment
Operator
Agreement
18. PLAINTIFFS’
exhibits
are
“written
instruments”
constituting,
“in
whole
or
in
part,”
the
claim
sued
upon,
pursuant
to
TRCP
59.
PLAINTIFFS’
FIFTH
AMENDED
PETITION
&
REQUESTS
FOR
DISCLOSURE
5
VIII. IWORKS
DEFENDANTS
&
WM
DEFENDANTS
ARE
NON-­‐SUBSCRIBER’S
TO
THE
WORKERS’
COMPENSATION
ACT
19. IWORKS
DEFENDANTS
did
not
maintain
a
workers’
compensation
insurance
policy
in
accordance
with
the
Workers’
Compensation
Act
and/or
did
not
maintain
a
workers’
compensation
insurance
policy
that
covered
MOSE
GUILLORY
at
the
time
of
the
incident,
which
failure
makes
IWORKS
DEFENDANTS
a
nonsubscriber.
TEXAS
LABOR
CODE
§408.001(a).
Because
IWORKS
DEFENDANTS
are
nonsubscribers
and
their
employee,
PLAINTIFF
MOSE
GUILLORY,
was
injured
on
the
job
and
by
their
negligence
and/or
gross
negligence,
the
Workers’
Compensation
Act
does
not
shield
IWORKS
DEFENDANTS
from
suit.
See
TEX.
LAB.
CODE
§§406.033,
408.001
20. Upon
information
and
belief,
WM
DEFENDANTS
did
not
maintain
a
workers’
compensation
insurance
policy
in
accordance
with
the
Workers’
Compensation
Act,
did
not
maintain
a
workers’
compensation
insurance
policy
that
covered
MOSE
GUILLORY,
and/or
cannot
claim
“subscriber”
status
under
Texas
law
at
the
time
of
the
incident,
which
failure
makes
WM
DEFENDANTS
a
nonsubscriber.
TEXAS
LABOR
CODE
§408.001(a).
Because
WM
DEFENDANTS
are
nonsubscribers
and
their
employee,
PLAINTIFF
MOSE
GUILLORY,
was
injured
on
the
job
and
by
their
negligence
and/or
gross
negligence,
the
Workers’
Compensation
Act
does
not
shield
WM
DEFENDANTS
from
suit.
See
TEX.
LAB.
CODE
§§406.033,
408.001.
21. Additionally,
by
virtue
of
being
nonsubscribers,
IWORKS
DEFENDANTS
and
WM
DEFENDANTS
are
precluded
from
asserting
the
following
defenses
in
answering,
responding,
or
defending
this
lawsuit:
(1)
contributory
negligence;
(2)
assumption
of
the
risk;
(3)
negligence
of
a
fellow
employee;
and
(4)
pre-­‐injury
waiver
of
liability.
See
TEX.
LAB.
CODE
§406.033(a),
(e).
IX. FACTS
22. LEGAL
ISSUES
INVOLVED
–
BACKGROUND.
The
legal
issues
involved
in
this
case
include
Contract
Law,
Employment
Law,
and
Tort
Law.
A
brief
historical
analysis
of
the
interplay
of
these
legal
PLAINTIFFS’
FIFTH
AMENDED
PETITION
&
REQUESTS
FOR
DISCLOSURE
6
issues
is
important
in
understanding
Defendants’
motivation
and
Defendants’
“borderland”
of
liability.
Employment
law
looks
at
“Who
is
the
Employee?”
and
“Who
is
the
Employer?”
–
the
latter
of
which
is
critical
in
assessing
who
is
responsible
for
employment
benefits
under
various
federal
and
state
employment
laws
(e.g.
worker
misclassification
–
where
the
misclassification
or
wrongful
classification
of
an
employee
as
a
“contractor”
would
essentially
deny
an
employee
of
most
federal
employment
law
benefits
–
collective
bargaining
for
example 1 ) 2 .
Although
seemingly
simple,
determining
this
“employment
relationship”
is
often
times
difficult,
under
the
law3.
In
determining
this
“employment
relationship,”
employers
have
taken
great
strides
in
blurring
the
lines
of
the
employment
relationship
in
an
effort
to
operate
outside
federal
and
state
employment
laws
–
to
operate
in
the
“borderland”4
of
liability.
The
objective
is
obvious
–
when
the
employment
relationship
is
unclear,
employment
rights
are
unclear5;
and,
as
a
result,
a
financial
windfall
is
reaped
by
the
employer
who
blurred
the
lines6.
This
1
http://mynlrb.nlrb.gov/link/document.aspx/09031d4580022ea1
2
See
WHD
News
Release
11-­‐1373-­‐NAT,
Labor
Secretary,
IRS
Commissioner
Sign
Memorandum
of
Understanding
to
Improve
Agencies’
Coordination
on
Employee
Misclassification
Compliance
and
Education
(Sept.
19,
2011).
Deputy
Secretary
of
Labor
Seth
Harris
explained
the
significance
of
the
problem
of
worker
misclassification
in
his
testimony
before
Congress:
“Misclassification”
seems
to
suggest
a
technical
violation
or
a
paperwork
error.
But
“worker
misclassification”
actually
describes
workers
being
illegally
deprived
of
labor
and
employment
law
protections,
as
well
as
public
benefits
programs
like
unemployment
insurance
and
workers’
compensation
because
such
programs
generally
apply
only
to
“employees”
rather
than
workers
in
general.
.
.
.
Misclassification
is
no
mere
technical
violation.
It
is
a
serious
threat
to
workers
and
the
fair
application
of
the
laws
Congress
has
enacted
to
assure
workers
have
good,
safe
jobs.
Leveling
the
Playing
Field:
Protecting
Workers
and
Businesses
Affected
by
Misclassification
Before
the
S.
Comm.
On
Health,
Education,
Labor
and
Pensions,
111th
Cong.
(2010)
(statement
of
Seth
Harris,
Deputy
Sec’y
of
Labor).
3
The
Supreme
Court,
for
example,
has
referred
to
the
definition
of
an
employee
under
the
Americans
with
Disabilities
Act
as
a
“mere
‘nominal
definition,’”
Clackamas
Gastroenterology
Assocs.
v.
Wells,
538
U.S.
440,
444
(2003),
and
has
stated
that
the
definition
of
an
employee
under
the
Employee
Retirement
Income
Security
Act
is
“completely
circular
and
explains
nothing,”
Nationwide
Mut.
Ins.
Co.
v.
Darden,
503
U.S.
318,
323
(1992).
4
See
NLRB
v.
Hearst
Publ’ns,
Inc.,
322
U.S.
111,
121
(1944)
(quoting
U.S.
Supreme
Court
Justice
Wiley
Blount
Rutledge).
5
See
Mitchell
H.
Rubinstein,
Our
Nation’s
Forgotten
Workers:
The
Unprotected
Volunteers,
9
U.
OF
PA.
J.
LAB.
&
EMP.
L.
147,
151
(2006)
(citing
Seattle
Opera
v.
NLRB,
292
F.3d
757,
759
(D.C.
Cir.
2002))
(holding
that
an
individual
was
an
employee
under
NLRA
even
though
he
was
not
paid
the
minimum
wage
and
did
not
receive
tax
form
W-­‐2);
see
also
Hopkins
v.
Cornerstone
Am,
545
F.3d
338,
347
(5th
Cir.
2008)
(stating
that
it
is
not
inconsistent
to
be
considered
an
employee
under
the
FLSA,
but
an
independent
contractor
under
other
statutes);
City
Cab
Co.
of
Orlando,
285
N.L.R.B.
1191,
1193
(1987)
(holding
that
employee
status
determinations
of
other
governmental
agencies
are
not
controlling,
but
should
be
given
consideration
by
the
NLRB);
see
BWI
Taxi
Mgmt,
No.
5-­‐RC-­‐4836874,
2010
WL
4836874,
at
*9
n.15
(NLRB
Reg.
Dir.
Sept.
16,
2010)
(stating
that
the
petitioner
received
a
letter
saying
he
was
an
independent
contractor
under
the
EEOC,
but
was
considered
an
employee
under
the
NLRA);
PLAINTIFFS’
FIFTH
AMENDED
PETITION
&
REQUESTS
FOR
DISCLOSURE
7
financial
windfall
and
danger
to
the
American
worker
has
seen
its
greatest
rise
in
the
“contingent
workforce”
and
in
recent
years
–
to
wit:
• U.S.
Labor
Department
reports
that
in
2013,
the
nation
had
more
temp
workers
than
ever
before:
2.7
million
temp
workers
in
U.S.7.
• Since
the
recession
ended
in
mid-­‐2009,
20%
of
job
growth
has
been
the
temp
sector8.
• Temp
work
is
roaring
back
10x
faster
than
private-­‐sector
employment9.
• On
average,
temps
earn
25%
less
than
permanent
workers.
• African
Americans
make
up
11%
of
the
overall
workforce
but
20%
of
the
temp
workforce.
• U.S.
Government
does
not
keep
statistics
on
injuries
among
temp
workers.
• Study
shows
that
temp
workers
in
construction
and
manufacturing
were
2x
as
likely
to
be
injured
as
regular
staff
doing
the
same
work10.
• OSHA
announced
an
initiative
to
get
better
information
on
temp-­‐worker
safety
–
stating:
“Employers,
we
think,
do
not
have
the
same
commitment
to
providing
a
safe
workplace,
to
providing
the
proper
training,
to
a
worker
who
they
may
only
be
paying
for
a
few
weeks…
I
mean,
we’ve
seen
just
ghastly
situations.11”
• Adding
to
the
“Who
is
the
Employer”
confusion
-­‐
33
states
have
statutes
or
regulations
that
address
employee
leasing
and
its
effect
on
which
entity
is
the
actual
employer,
while
17
states
and
the
District
of
Columbia
make
such
decisions
by
Court
opinions.
Seattle
Opera,
292
F.3d
at
761–62
(holding
individual
was
an
employee
even
though
he
was
treated
as
an
independent
contractor
for
tax
purposes
in
that
he
did
not
receive
a
W-­‐2
tax
form).
See
also
Richard
R.
Carlson,
Why
the
Law
Still
Can’t
Tell
an
Employee
When
It
Sees
One
and
How
It
Ought
to
Stop
Trying,
22
BERKELEY
J.
EMP.
&
LAB.
L.
295,
296
(2001)
(describing
statutory
definitions
of
employee
status
as
“baffling”).
6
It
has
been
estimated
that
classifying
individuals
as
independent
contractors
instead
of
as
employees
might
result
in
a
savings
of
twenty
to
forty
percent
of
labor
costs
to
the
quasi-­‐employer.
See
Jenna
Amato
Moran,
Note,
Independent
Contractor
or
Employee?
Misclassification
of
Workers
and
Its
Effect
on
the
State,
28
BUFF.
PUB.
INT.
L.J.
105,
121
(2010).
7
See
http://www.bls.gov/news.release/empsit.t17.htm
8
Id.
9
American
Staffing
Association
10
http://www.ncbi.nlm.nih.gov/pubmed/19618410
11
http://www.osha.gov/pls/oshaweb/owadisp.show_document?p_table=NEWS_RELEASES&p_id=23994
(quoting
David
Michaels,
OSHA
Director).
PLAINTIFFS’
FIFTH
AMENDED
PETITION
&
REQUESTS
FOR
DISCLOSURE
8
• Recently,
temp
firms
have
successfully
lobbied
to
change
laws
or
regulatory
interpretations
in
31
states,
so
that
workers
who
lose
their
temp
assignments
and
are
out
of
work
cannot
get
unemployment
benefits12.
As
is
clear,
the
“contingent
workforce”
is
larger
than
ever
at
2.7
million
temp
workers,
growing
ten
times
faster
than
private
sector
employment,
and
is
made
up
of
minorities
whom
earn
a
quarter
less,
get
injured
twice
as
much,
and
are
less
likely
to
understand
or
be
able
to
exercise
their
employment
rights
under
the
law.
That
is,
cases
like
Plaintiffs’
case
are
expected
to
rise
with
this
horrific
trend.
Applying
the
above
to
the
case
at
bar,
it
is
no
wonder
the
incident
involving
Plaintiff
Mose
Guillory
happened
necessitating
this
lawsuit.
23. PLAINTIFFS.
Plaintiffs
complain
of
Defendants
IWORKS
DEFENDANTS
and
WM
DEFENDANTS,
for
their
actions
and
inactions,
both
singularly,
in
combination,
and/or
collectively,
for
breaching
their
duties
of
safety,
safety
training,
and
workers’
compensation
coverage/compliance
to
and
for
the
benefit
of
Plaintiff
Mose
Guillory,
inter
alia,
which
breaches
proximately
caused
Plaintiffs’
damages,
as
set
forth
more
fully
below.
24. IWORKS
DEFENDANTS.
Defendant
IWORKS
PERSONNEL,
INC.
is
owned
and
operated
by
LUIS
TREVINO
and
HAYDEE
GUTIERREZ.
IWORKS
PERSONNEL,
INC.
is
in
the
business
of
leasing
employees
for
skilled
jobs
in
many
different
industries,
including
but
not
limited
to:
“construction,
manufacturing,
warehousing,
retail,
events
and
hospitality,
waste,
recycling,
transportation,
and
disaster
relief.”
See
http://www.iworkspersonnel.com.
Regarding
the
type
of
services
provided
to
its
leased
employees
and
to
client
companies,
Defendant
IWORKS
PERSONNEL,
INC.
also
states
the
following
–
to
wit:
How
does
iWORKS
PERSONNEL
help
solve
your
people
issues?
***
*
We
offer
free
Basic
PPE
(Personal
Protective
Equipment)
*
Basic
Safety
Training
(not
site
specific)
12
http://www.workforcesecurity.doleta.gov/unemploy/pdf/uilawcompar/2013/nonmonetary.pdf
PLAINTIFFS’
FIFTH
AMENDED
PETITION
&
REQUESTS
FOR
DISCLOSURE
9
*
WE
PAY
ALL
PAYROLL
TAXES
and
file
them
*
WE
PAY
ALL
UNEMPLOYMENT
TAXES
and
file
them
*
WE
PROVIDE
WORKERS
COMPENSATION
*
WE
PROVIDE
1
worker
or
hundreds,
for
the
day
or
as
long
as
you
need
them
(minimum
4
hours)
See
http://iworkspersonnel.com/clientsolution.aspx
(emphasis
added).
As
is
clear,
in
addition
to
supplying
client
companies
with
leased
employees
or
temporary
workers,
IWORKS
DEFENDANTS
also
have
the
duty
and
responsibility
to
provide
worker’s
compensation.
25. WM
DEFENDANTS.
Defendants
WASTE
MANAGEMENT,
INC.,
WASTE
MANAGEMENT
OF
TEXAS,
INC.,
and
WM
RECYCLE
AMERICA,
LLC
are
hereinafter
sometimes
referred
to
as
“WASTE
MANAGEMENT”
or
“WM
DEFENDANTS.”
Upon
information
and
belief,
WASTE
MANAGEMENT,
INC.
is
a
holding
company
and
WASTE
MANAGEMENT
OF
TEXAS,
INC.
and
WM
RECYCLE
AMERICA,
LLC
are
its
subsidiaries,
which
operate
Defendants
WASTE
MANAGEMENT’s
Facility
at
4939
Gasmer
Dr.,
Houston,
Harris
County,
Texas
77035
(“Facility”)
and
which
provide
collection,
transfer,
recycling,
and
disposal
services,
under
the
direction
and
control
of
Defendant
WASTE
MANAGEMENT,
INC.
WM
DEFENDANTS
claim
the
following
about
itself
as
a
corporation(s)
and
about
its
safety
policies
–
to
wit:
Waste
Management
is
the
largest
environmental
solutions
provider
in
North
America,
serving
more
than
20
million
customers
in
the
U.S.,
Canada
and
Puerto
Rico….
As
North
America’s
largest
residential
recycler,
we
expect
to
manage
more
than
20
million
tons
every
year
by
2020,
up
from
the
more
than
12
million
tons
we
handled
in
2012.
See
http://www.wm.com/about/index.jsp
(emphasis
added).
At
Waste
Management,
safety
is
a
core
value
and
a
cornerstone
of
operational
excellence.
This
philosophy
is
embedded
in
the
way
we
work,
the
decisions
we
make
and
the
actions
we
take….
Our
plan
of
action
is
called
Mission
to
Zero
(M2Z),
which
means
zero
tolerance
for
unsafe
actions,
unsafe
decisions,
unsafe
conditions,
unsafe
equipment
and
unsafe
attitudes.
The
cornerstone
of
M2Z
is
training,
which
provides
classroom
and
on-­‐the-­‐job
site
instruction
in
safety
fundamentals
for
supervisors,
drivers
and
helpers.
Operations
Rule
Book,
Driving
Science
Series
videos
and
Electronic
Observation
Behavior
Assessments
are
just
a
few
of
the
tools
available
to
our
frontline
managers
to
help
them
to
develop
our
employees….
Waste
Management
sites
continuously
monitor
and
measure
safety
performance….
Through
established
safety
processes
and
procedures,
PLAINTIFFS’
FIFTH
AMENDED
PETITION
&
REQUESTS
FOR
DISCLOSURE
10
our
goal
of
zero
accidents
and
injuries
is
transformed
into
measurable
results
that
have
a
positive
impact
on
thousands
of
people.
See
http://investors.wm.com/phoenix.zhtml?c=119743&p=irol-­‐govhighlights
(“Safety
Policy”
download)
(emphasis
added).
As
is
clear,
WM
DEFENDANTS,
combined,
are
a
large
corporation
who,
given
its
size
and
breadth,
recognize
their
duty
and
responsibility
to
provide
safety,
training,
and
monitoring
of
safety
and
training.
26. DEFENDANTS’
Relationships.
At
all
times
material
hereto,
DEFENDANTS
entered
into
contractual
agreements
and
relationships
with
one
another
for
the
performance
of
their
duties,
as
it
pertains
to
Plaintiff
Mose
Guillory,
which
contractual
agreements
were
entered
into
prior
to
July
9,
2012.
See
Exhibit
A
(WM
DEFENDANTS’
Master
Agreement
with
IWORKS
DEFENDANTS)
and
Exhibit
B
(Heavy
Equipment
Operator
Agreement
between
WM
DEFENDANTS
and
IWORKS
DEFENDANTS).
27. Plaintiff
Mose
Guillory
–
Employed
by
IWORKS
DEFENDANTS
and
Leased
to
WM
DEFENDANTS.
On
or
about
the
morning
of
July
9,
2012,
Plaintiff
MOSE
GUILLORY
applied
for
a
job
at
IWORKS’s
Houston,
Texas
office.
Shortly
after
filling
out
an
application
at
IWORKS’s
Houston,
Texas
office,
PLAINTIFF
MOSE
GUILLORY
received
a
call
from
IWORKS,
wherein
IWORKS
informed
PLAINTIFF
MOSE
GUILLORY
that
he
was
hired
and
that
he
was
being
assigned
to
WASTE
MANAGEMENT
at
its
facility
located
at
4939
Gasmer
Dr.,
Houston,
Harris
County,
Texas
77035
(“Facility”
or
“Gasmer
MRF”).
28. MOSE
GUILLORY
was
leased
to
Gasmer
MRF
to
perform
tasks
involving
“a
particular
skill;
.
.
.
training
in
a
particular
occupation,
craft,
or
trade;
.
.
.
or
practical
knowledge
of
the
principles
or
processes
of
an
art,
science,
craft,
or
trade.”
See
Tex.
Lab.
Code
§92.002(3)(a)-­‐(c).
29. Plaintiff
Mose
Guillory
–
Employed
by
WM
DEFENDANTS.
At
or
around
12:00
pm
on
July
9,
2012,
Plaintiff
MOSE
GUILLORY
reported
to
the
WASTE
MANAGEMENT
Facility
where
he
was
instructed
to
drive
a
front-­‐end
loader
while
a
maintenance
employee,
Abraham
Hernandez,
observed.
After
a
short
demonstration,
Abraham
Hernandez
was
satisfied
that
PLAINTIFF
MOSE
GUILLORY
had
the
requisite
PLAINTIFFS’
FIFTH
AMENDED
PETITION
&
REQUESTS
FOR
DISCLOSURE
11
skill
to
drive
and
operate
the
front-­‐end
loader
at
WASTE
MANAGEMENT
and
instructed
PLAINTIFF
MOSE
GUILLORY
to
report
for
work
the
next
morning
–
July
10,
2012.
30. For
the
first
week
of
his
employment,
from
roughly
July
10,
2012—July
16,
2012,
PLAINTIFF
MOSE
GUILLORY
worked
on
the
day
shift
at
WASTE
MANAGEMENT’s
Facility.
This
shift
was
from
approximately
5:00
a.m.
until
4:30
p.m.,
approximately
seven
days
per
week.
During
that
time,
PLAINTIFF
MOSE
GUILLORY’S
primary
job
duty
was
to
drive
and
operate
a
front-­‐end
loader.
Thereafter,
approximately
one
or
two
weeks
after
starting
work
at
WASTE
MANAGEMENT’s
Facility,
PLAINTIFF
MOSE
GUILLORY
was
re-­‐scheduled
to
work
the
night
shift
from
4:30
p.m.
until
5:00
a.m.
31. Upon
joining
the
night
shift
and
sometime
thereafter,
PLAINTIFF
MOSE
GUILLORY
was
instructed
to
operate
a
Harris
Centurion
Baler.
32. Harris
Baler.
The
product
in
question,
a
Harris
Centurion
Baler,
is
a
piece
of
“heavy
equipment”
or
industrial
machinery
used
in
recycling
facilities
primarily
for
baling
metal,
plastic,
cardboard,
or
paper
for
transport.
The
product
is
designed
to
operate
in
the
following
manner:
the
user
stands
on
a
platform
in
front
of
a
control
port
and
activates
a
conveyor
belt
that
carries
loose
product
(paper,
plastic,
metal,
etc.)
into
the
baler;
then,
the
user
engages
the
baler’s
hydraulic
rams,
which
compresses
the
material
loaded
into
compact,
transportable
bales.
33. The
Harris
Baler
is
sold
with
a
25-­‐minute
training
video
that
addresses
safety
and
a
200-­‐page
“Operator/Service
Manual”
that
must
be
read
and
understood
before
operation.
Before
operating
the
Harris
Centurion
Baler,
one
must
have
received
OSHA-­‐mandated
“Lockout-­‐Tagout”
(“LOTO”)
training.
See
29
C.F.R.
1910.147.
LOTO
requires
that
hazardous
power
sources
be
“isolated
and
rendered
inoperative”
before
any
maintenance
or
servicing
work
is
performed
to
prevent
serious
injury
or
death.
34. No
Training
on
the
Harris
Baler.
At
no
point
was
PLAINTIFF
MOSE
GUILLORY
shown
any
training
video
detailing
how
to
safely
operate
the
Harris
Baler.
At
no
point
was
PLAINTIFF
MOSE
PLAINTIFFS’
FIFTH
AMENDED
PETITION
&
REQUESTS
FOR
DISCLOSURE
12
GUILLORY
told
about
or
given
any
operator’s
manual
detailing
how
to
safely
operate
the
Harris
Baler.
At
no
point
was
PLAINTIFF
MOSE
GUILLORY
given
any
training
or
exposed
to
any
material
whatsoever,
whether
in
audio,
video,
written,
electronic,
or
other
format,
detailing
how
to
safely
operate
the
Harris
Baler.
At
no
point
was
PLAINTIFF
MOSE
GUILLORY
provided
any
OSHA-­‐mandated
“Lockout-­‐Tagout”
(“LOTO”)
training.
See
29
C.F.R.
1910.147.
35. No
Training
on
the
Harris
Baler
-­‐
Carlos.
Instead,
the
full
extent
of
PLAINTIFF
MOSE
GUILLORY’S
“training”
(which
Plaintiffs
dispute)
was
observations
from
a
coworker
named
Carlos.
Carlos
is
a
Hispanic
man
whose
first
language
is
Spanish.
Carlos
cannot
fluently
speak
or
understand
English
well.
PLAINTIFF
MOSE
GUILLORY’S
first
language
is
English.
PLAINTIFF
MOSE
GUILLORY
cannot
speak
or
understand
Spanish.
Regardless,
Carlos
demonstrated
that,
at
certain
times,
the
baler
operator
must
disengage
the
baler,
climb
onto
the
conveyor,
walk
up
to
the
top
of
the
conveyor
near
the
baler
mouth,
and
use
a
pole
to
sweep
product
down
onto
the
conveyor
belt
from
various
bins
adjacent
to
the
baler.
Little
more
was
provided
to
PLAINTIFF
MOSE
GUILLORY
on
how
to
safely
operate
the
Harris
Baler.
And,
at
no
time
did
Carlos
ever
instruct
PLAINTIFF
MOSE
GUILLORY
on
proper
OSHA
Lockout/Tagout
procedures.
36. August
5,
2012
–
Incident
at
Issue.
On
August
5,
2012,
PLAINTIFF
MOSE
GUILLORY
reported
for
work
on
the
night
shift
and
began
to
operate
the
Harris
Baler,
as
instructed.
At
that
time,
PLAINTIFF
MOSE
GUILLORY
had
only
operated
the
Harris
Baler
approximately
three
to
four
times
total.
Sometime
after
beginning
to
operate
the
Harris
Baler,
PLAINTIFF
MOSE
GUILLORY
disengaged
the
baler/conveyor
and
climbed
onto
the
conveyor
and
then
into
the
baler,
as
he
had
seen
Carlos
do
before.
Suddenly,
and
without
warning,
the
Harris
Baler
turned
on
and
the
baler
rams
engaged.
The
baler
rams
severed
PLAINTIFF
MOSE
GUILLORY’S
right
leg
just
below
the
knee
and
severed
all
toes
and
a
portion
of
his
left
foot.
PLAINTIFFS’
FIFTH
AMENDED
PETITION
&
REQUESTS
FOR
DISCLOSURE
13
37. Plaintiff
Mose
Guillory
–
Hospitalized.
PLAINTIFF
MOSE
GUILLORY
was
taken
by
ambulance
to
Memorial
Hermann
Hospital
in
the
Houston
Medical
Center.
There,
PLAINTIFF
MOSE
GUILLORY
underwent
multiple
surgeries
lasting
several
hours.
These
surgeries
were
required
to
complete
the
full
amputation
of
PLAINTIFF
MOSE
GUILLORY’S
right
leg
below
the
knee
as
well
as
all
toes
and
a
portion
of
his
left
foot.
As
a
result
of
the
aforementioned
events,
Plaintiff
MOSE
GUILLORY
was
hospitalized
for
roughly
seventeen
(17)
days.
38. While
in
the
hospital
and
while
in
ICU,
PLAINTIFF
MOSE
GUILLORY
was
heavily
medicated.
During
this
time,
he
was
approached
by
agents
of
IWORKS
whom
presented
him
with
various
papers,
authorizations,
and/or
releases
to
obtain
information
without
his
informed
consent.
In
an
incapacitated
state,
PLAINTIFF
MOSE
GUILLORY
signed
documents
for
IWORKS
DEFENDANTS
and/or
WM
DEFENDANTS.
39. IWORKS
and
WM
DEFENDANTS’
Cover-­‐Up.
Upon
information
and
belief
following
the
incident,
IWORKS
DEFENDANTS
and
WM
DEFENDANTS
took
steps
to
cover
up
the
incident
including,
among
others,
firing
employees,
which
former
employees
have
advised
counsel
for
PLAINTIFFS
that
Defendant
WASTE
MANAGEMENT
is
and
was
taking
steps
to
cover
up
the
incident.
40. iWorks
did
not
think
it
was
iWorks’
obligation
to
train
employees
before
sending
them
to
Gasmer
MRF.
iWorks
claims
it
did
not
know
WM
DEFENDANTS
were
expecting
it
(IWORKS)
to
train.
WM
DEFENDANTS
did
not
know
that
iWorks
was
not
training
or
qualifying
employees
it
(IWORKS)
was
sending
over.
Accordingly,
WM
DEFENDANTS
did
not
train.
Instead,
due
to
the
break
down
in
communications,
Mose
Guillory
received
zero
training
from
either
iWorks
or
WM
DEFENDANTS.
In
fact,
the
failure
to
train
Mose
Guillory
on
lock-­‐out/tag-­‐out
(“LO/TO”)
and
to
ensure
that
he
did
not
operate
the
Harris
Baler
without
proper
LO/TO
training
resulted
in
violations
of
OSHA
regulations
and
hefty
fines
imposed
on
the
site
owner,
WM
DEFENDANTS.
PLAINTIFFS’
FIFTH
AMENDED
PETITION
&
REQUESTS
FOR
DISCLOSURE
14
41. As
further
evidence
of
the
communication
(“conduit”)
breakdown,
Plaintiffs
offer
the
deposition
testimony
Defendant
LUIS
TREVINO,
CEO
and
part
owner
of
iWorks.
Mr.
Trevino
testified,
inter
alia,
that
Defendant
iWorks
“[does
not]
provide
site-­‐specific
training.”
Mr.
Trevino
then
unequivocally
stated
the
following:
p.
69
18.
Q.
You
don't.
So
if
-­‐-­‐
if
Waste
Management
or
19
somebody
at
Gasmer
had
given
y'all
a
DVD
of
20
site-­‐specific
training
to
provide
to
iWorks
employees
21
who
are
temporary
laborers
and
going
out
there,
then
you
22
wouldn't
have
done
it?
23
MR.
GARZA:
Objection,
form.
24
A.
We
never
received
one,
nor
would
I
have
played
25
it.
Next,
LUIS
TREVINO
was
asked
about
iWorks’s
obligation
under
the
“Master
Services
Agreement”
executed
between
iWorks
and
WM
Defendants
–
to
wit:
p.
70
16
Q.
"Contractor
is
obligated
to
ensure
that
17
Personnel
supplied
to
Waste
Management
are
fully
18
qualified
and
trained
for
the
jobs
they
are
being
19
supplied
to
perform
and
they
have
been
given
safety
20
training
that
meets
or
exceeds
the
training
Waste
21
Management
provides
to
its
employees
for
the
same
or
22
similar
jobs."
23
Okay.
So
you're
telling
me
that
that
is
24
not
something
that
you
did
with
any
of
the
workers
that
25
were
sent
to
Waste
Management.
p.
71
1
A.
I
don't
know
Waste
Management
policy
and
2
procedure.
How
could
I
train
them
on
Waste
Management
3
policy
or
procedure,
safety
rules,
machinery[?]
4
Q.
Okay.
But
if
-­‐-­‐
but
if
that
information
had
5
been
provided
to
you
or
provided
to
the
folks
in
the
6
field
in
Houston,
then
they
should
have
done
that,
7
right?
8
A.
It
wasn't
provided,
and
I
would
not
have
done
9
it.
PLAINTIFFS’
FIFTH
AMENDED
PETITION
&
REQUESTS
FOR
DISCLOSURE
15
42. As
further
evidence
of
the
communication
(“Conduit”)
breakdown,
Plaintiffs
offer
the
deposition
testimony
Steve
Hasley,
former
Recycling
Director
of
WM
DEFENDANTS.
On
the
issue
of
training
and
safety,
Steve
Hasley
directly
contradicts
the
testimony
of
Luis
Trevino
–
to
wit:
p.
86
1
A.
Yes.
2
Q.
Okay.
Is
there
any
document
that
identifies
that
3
this
training
topic,
everything
that's
above
Environmental
4
Protection
Orientation
Training,
was
to
be
conducted
by
the
5
temp
agency?
6
A.
I
have
not
seen
one.
7
Q.
Okay.
8
A.
That
was
supposedly
in
the
contract.
But
I've
9
never
seen
the
contract.
So
I
don't
-­‐-­‐
I
can't
say
for
10
sure.
11
Q.
And
what
contract
are
you
speaking
of?
12
A.
The
contract
that
Staff
Management
had
with
the
13
temp
labor
provider.
14
Q.
Why
would
Waste
Management
allow
someone
else
to
15
perform
this
orientation
training?
16
MS.
SCHADLE:
Objection;
form.
17
A.
Well,
it
all
-­‐-­‐
it
all
depends
on
the
site
and
18
what
you
got
going.
If
you
got
a
lot
of
employees
and
19
you're
bringing
in
a
lot
of
employees,
then
it
does
relieve
20
the
burden
off
the
-­‐-­‐
the
management
at
the
site,
the
21
supervision
to
have
to
sit
down
for,
you
know,
two
hours
to
22
go
through
this
DVD
and
discussion
and
all
that
kind
of
23
thing.
And
that's
why
it's
done
at
some
sites
like
that,
24
why
the
temp
labor
provider
does
it.
25
Q.
(BY
MR.
GILDE)
Can
you
identify
all
the
sites
in
p.
87
1
Texas
where
the
temp
laborer
provider
performs
this
2
training?
3
MS.
SCHADLE:
Objection;
form.
4
A.
I
don't
know
all
of
them.
I
know
that
they
do
it
5
at
Arlington
and
I
know
that
they
do
it
at
-­‐-­‐
at
Brittmoore.
6
Q.
(BY
MR.
GILDE)
At
Brittmoore?
7
A.
Yes.
8
Q.
And
also
at
Gasmer?
9
A.
I
think
-­‐-­‐
yes,
I
think
they
do
it
at
Gasmer,
too.
10
Q.
Okay.
Anywhere
else?
11
MS.
SCHADLE:
Objection;
form.
12
A.
Not
that
I
can
think
of.
I
don't
know.
They
may
PLAINTIFFS’
FIFTH
AMENDED
PETITION
&
REQUESTS
FOR
DISCLOSURE
16
13
be
doing
it.
Where
JG
is
at,
any
place
JG
is
at,
I
think
14
they're
doing
-­‐-­‐
they
do
it
for
their
temp
employees.
15
Q.
(BY
MR.
GILDE)
Okay.
And
what
is
the
basis
for
16
that
opinion?
17
A.
Because
that's
part
of
their
service
that
they
18
offer
within
their
rate.
9
Q.
(BY
MR.
GILDE)
Is
there
-­‐-­‐
it's
not
going
to
be
10
your
testimony
that
it
would
be
impossible
to
perform
safety
11
orientation
training
at
the
4939
Gasmer
Drive
facility?
12
MS.
SCHADLE:
Objection;
form.
13
MR.
GARZA:
Same
objection.
14
A.
It
would
not
be
impossible.
15
Q.
(BY
MR.
GILDE)
Okay.
That's
something
Waste
16
Management
could
do?
17
MR.
GARZA:
Objection;
form.
18
MS.
SCHADLE:
Objection;
form.
19
A.
That's
something
that
the
plant
site
personnel
20
could
-­‐-­‐
could
do.
21
Q.
(BY
MR.
GILDE)
Okay.
And
in
this
case
Waste
22
Management
chose
not
to
do
that,
true?
23
MR.
GARZA:
Objection;
form.
24
MS.
SCHADLE:
Objection;
form.
25
A.
Yeah.
In
this
case
the
plant
site
was
contracted
p.
105
1
through
Staff
Management
for
the
temporary
service
provider
2
to
conduct
this
training.
As
is
clear,
WM
DEFENDANTS
didn’t
know
what
IWORKS
DEFENDANTS
were
doing
and
vice
versa
with
respect
to
training
and
safety.
WM
DEFENDANTS
point
the
finger
at
IWORKS
DEFENDANTS
and
IWORKS
DEFENDANTS
point
the
finger
at
WM
DEFENDANTS.
43. Defendants’
Liability
and
Vicarious
Liability.
Defendants’
actions
and/or
inactions
and
breaches
of
duties
to
Plaintiffs
were
effectuated
by
Defendants’
employees,
agents,
service
providers,
officers,
directors,
assigns,
and/or
individuals
under
the
control
or
direction
of
Defendants.
As
such,
Defendants,
each
of
them,
are
responsible/liable
for
the
following
claims
and
causes
of
action
detailed
below
and
herein,
which
responsibility/liability
includes
but
is
not
limited
to:
Aiding
&
Abetting;
PLAINTIFFS’
FIFTH
AMENDED
PETITION
&
REQUESTS
FOR
DISCLOSURE
17
Assisting
&
Participating;
Concert
of
Action;
Respondeat
Superior;
Nondelegable
Duty;
Partnership;
and
Joint
Enterprise
theories
of
liability.
44. Due
to
Defendants’
actions
and/or
inactions
and
breaches
of
duties
to
Plaintiffs,
Plaintiffs
bring
the
following
claims
and
causes
of
action
against
Defendants
–
to
wit
X. RESPONDEAT
SUPERIOR
(ALL
DEFENDANTS
)
45. PLAINTIFFS
re-­‐allege
all
of
the
allegations
in
the
previous
paragraphs,
as
though
set
forth
fully
herein.
46. Plaintiff
MOSE
GUILLORY
was
injured
and
PLAINTIFFS
have
suffered
damages,
as
a
result
of
the
torts
detailed
below.
47. IWORKS
DEFENDANTS
and
WM
DEFENDANTS
are
employer-­‐tortfeasors
whom
employed
tortfeasor-­‐employees
that
breached
duties
to
PLAINTIFFS,
which
resulted
in
Plaintiff
MOSE
GUILLORY’s
injuries
and
PLAINTIFFS’
damages,
as
detailed
more
fully
below.
48. DEFENDANTS’
tortfeasor-­‐employees
committed
torts
while
said
tortfeasor-­‐employees
were
acting
within
the
scope
of
their
employment.
That
is,
their
acts
were:
(i)
within
the
tortfeasor-­‐employees’
general
authority;
(ii)
in
furtherance
of
DEFENDANTS’
business;
and
(iii)
for
the
accomplishment
of
the
object
for
which
tortfeasor-­‐employees
were
hired.
XI.PARTNERSHIP
LIABILITY
(IWORKS
PERSONNEL,
INC.,
LUIS
TREVINO,
and
HAYDEE
GUTIERREZ)
49. PLAINTIFFS
re-­‐allege
all
of
the
allegations
in
the
previous
paragraphs,
as
though
set
forth
fully
herein.
50. IWORKS
PERSONNEL,
INC.
appears
to
have
been
duly
incorporated
under
the
laws
of
the
State
of
Texas
on
February
26,
2007.
However,
IWORKS
PERSONNEL,
INC.
has
forfeited
its
corporate
status
numerous
times
pursuant
to
TEXAS
TAX
CODE
§
171.309,
the
last
of
which
occurred
on
or
about
May
16,
2012
and
certainly
no
later
than
February
8,
2013.
At
present,
the
Texas
Secretary
of
State
lists
IWORKS
PLAINTIFFS’
FIFTH
AMENDED
PETITION
&
REQUESTS
FOR
DISCLOSURE
18
PERSONNEL,
INC.’s
corporate
status
as
“forfeited
existence,”
meaning
it
no
longer
exist
as
a
“de
jure
corporation.”
Regardless,
IWORKS
PERSONNEL,
INC.
was
not
operating
as
a
corporation
under
the
laws
of
the
State
of
Texas
at
the
time
of
the
incident
at
issue.
51. Defendants
LUIS
TREVINO
and
HAYDEE
GUTIERREZ
are
personally
liable
for
the
debts
and
acts
of
each
other
and
of
IWORKS
PERSONNEL,
INC.
because
LUIS
TREVINO
and
HAYDEE
GUTIERREZ
operated
and
continue
to
operate
IWORKS
PERSONNEL,
INC.
(d/b/a
“Preferred
Staffing,
L.L.C.”)
as
a
partnership.
Specifically,
LUIS
TREVINO
and
HAYDEE
GUTIERREZ:
a. Incorporated
Preferred
Staffing,
L.L.C.
under
the
laws
of
the
State
of
Texas
on
or
about
July
18,
2005.
However,
upon
information
and
belief,
Preferred
Staffing,
L.L.C.
forfeited
its
corporate
status
pursuant
to
TEXAS
TAX
CODE
§
171.309
on
or
about
July
24,
2009.
At
present,
the
Texas
Secretary
of
State
lists
Preferred
Staffing,
L.L.C.’s
corporate
status
as
“forfeited
existence”;
b. Incorporated
IWORKS
PERSONNEL,
INC.
under
the
laws
of
the
State
of
Texas
on
or
about
February
26,
2007.
However,
upon
information
and
belief,
IWORKS
PERSONNEL,
INC.
thereafter
forfeited
its
corporate
status
on
multiple
occasions
pursuant
to
TEXAS
TAX
CODE
§
171.309.
At
present,
the
Texas
Secretary
of
State
lists
IWORKS
PERSONNEL,
INC.’s
corporate
status
as
“forfeited
existence”;
c. Shared
or
have
the
right
to
share
profits
of
IWORKS
PERSONNEL,
INC.
Upon
information
and
belief,
both
LUIS
TREVINO
and
HAYDEE
GUTIERREZ
intended
that
IWORKS
PERSONNEL,
INC.
be
operated
as
a
corporation
and
believed
this
to
be
the
case.
LUIS
TREVINO
maintains
60%
ownership
of
IWORKS
PERSONNEL,
INC.
and
HAYDEE
GUTIERREZ
maintains
40
%
ownership;
d. Expressed
an
intent
to
be
partners
in
the
business,
as
evidenced
by
their
deposition
testimony
and
exhibits
attached
thereto
(i.e.
Articles
of
Incorporation)
to
that
effect;
e. Participate
and/or
have
the
right
to
participate
in
control
of
the
business.
Specifically,
LUIS
TREVINO
is
Chief
Executive
Officer
who
allegedly
oversees
operations
while
HAYDEE
GUTIERREZ
is
President
and
allegedly
oversees
marketing,
sales,
and
client
relations;
f. Shared
and/or
agreed
to
share
in
the
losses
and
liabilities
of
the
business;
g. Contributed
and/or
agreed
to
contribute
money
or
property
to
the
business;
h. Co-­‐owned
property;
and
i. Shared
or
had
a
right
to
share
gross
returns
and/or
revenues
of
the
business.
PLAINTIFFS’
FIFTH
AMENDED
PETITION
&
REQUESTS
FOR
DISCLOSURE
19
52. At
the
time
of
the
events
and
incidents
at
issue
herein,
LUIS
TREVINO
and
HAYDEE
GUTIERREZ
were
committing
various
acts
and
omissions
while
in
the
ordinary
course
of
business
and
with
the
authority
of
the
partnership.
53. Specifically,
the
decisions
made,
policies
enacted,
contracts
signed,
and
all
other
negligent
acts
or
omissions
committed
by
LUIS
TREVINO
and
HAYDEE
GUTIERREZ,
were
done
so
while
LUIS
TREVINO
and
HAYDEE
GUTIERREZ
were
acting
in
the
ordinary
course
of
business
and
with
the
authority
of
the
partnership,
IWORKS
PERSONNEL,
INC.
(d/b/a
Preferred
Staffing).
XII.
JOINT-­‐ENTERPRISE
LIABILITY
(IWORKS
PERSONNEL,
INC.,
LUIS
TREVINO,
and
HAYDEE
GUTIERREZ)
54. PLAINTIFFS
re-­‐allege
all
of
the
allegations
in
the
previous
paragraphs,
as
though
set
forth
fully
herein.
55. At
the
time
of
the
events
and
incidents
at
issue
herein,
LUIS
TREVINO
and
HAYDEE
GUTIERREZ
were
engaged
in
a
joint
enterprise.
Defendants
LUIS
TREVINO
and
HAYDEE
GUTIERREZ
had
an
agreement,
a
common
purpose,
a
community
of
pecuniary
interest
in
that
common
purpose,
and
an
equal
right
to
direct
and
control
various
aspects
of
the
enterprise
(i.e.
IWORKS
PERSONNEL,
INC.).
56. Thus,
Defendants
LUIS
TREVINO
and
HAYDEE
GUTIERREZ
are
personally
liable
for
each
other’s
acts
and
for
the
acts
of
employees
of
IWORKS
PERSONNEL,
INC.
(d/b/a
Preferred
Staffing).
57. At
the
time
of
the
decisions
made,
policies
enacted,
contracts
signed,
and
all
other
negligent
acts
or
omissions
committed
regarding
the
incident
in
question,
LUIS
TREVINO,
HAYDEE
GUTIERREZ,
and
other
IWORKS
PERSONNEL,
INC.
employees
were
acting
within
the
scope
of
the
enterprise.
XIII. COUNT
1:
NEGLIGENCE
(IWORKS
DEFENDANTS
and
WM
DEFENDANTS
)
58. PLAINTIFFS
re-­‐allege
all
of
the
allegations
in
the
previous
paragraphs,
as
though
set
forth
fully
herein.
59. IWORKS
DEFENDANTS
and
WM
DEFENDANTS
are
liable
to
PLAINTIFFS
for
negligence.
PLAINTIFFS’
FIFTH
AMENDED
PETITION
&
REQUESTS
FOR
DISCLOSURE
20
60. IWORKS
DEFENDANTS
and
WM
DEFENDANTS
owed
a
legal
duty
to
PLAINTIFFS
in
hiring,
employing,
training,
and
supervising
PLAINTIFF
MOSE
GUILLORY,
which
duties
include
but
are
not
limited
the
following
duties
and
nondelegable
duties
–
to
wit:
a. An
employer
has
a
nondelegable
duty
to
provide
a
safe
workplace
for
its
employees;
b. An
employer
has
a
nondelegable
duty
to
provide
rules
and
regulations
for
the
safety
of
its
employees;
c. An
employer
has
a
nondelegable
duty
to
furnish
reasonably
safe
machinery
or
tools
for
its
employees;
and
d. An
employer
has
a
nondelegable
duty
to
select
careful
and
competent
employees.
e. An
employer
has
a
duty
to
train
its
employees
regarding
hazards
and
safety.
f. An
employer
has
a
duty
to
supervise
its
employees.
g. An
employer
has
the
duty
to
act
as
a
reasonably
prudent
employer
in
the
same
field
and
under
the
same
circumstances.
61. Defendants
breached
their
duty
through
their
negligent
employment,
actions,
and/or
inactions,
in
the
following
non-­‐exclusive
ways:
a. Failing
to
provide
a
reasonably
safe
workplace;
b. Failing
to
establish
rules
and
regulations
for
PLAINTIFF
MOSE
GUILLORY’S
safety;
c. Failing
to
warn
PLAINTIFF
MOSE
GUILLORY
of
the
hazards
of
his
employment;
d. Failing
to
train
PLAINTIFF
MOSE
GUILLORY;
e. Failing
to
train
PLAINTIFF
MOSE
GUILLORY
in
the
purpose
and
use
of
energy
control
procedures
(i.e.
“Lockout/Tagout”
Procedures);
f. Failing
to
certify
and/or
conduct
periodic
inspections
of
energy
control
procedures;
g. Exposing
PLAINTIFF
MOSE
GUILLORY
to
unknown
hazards
in
the
workplace;
h. Failing
to
furnish
reasonably
safe
machinery
or
instrumentalities;
i. Failing
to
provide
equipment
with
proper
safety
mechanisms;
PLAINTIFFS’
FIFTH
AMENDED
PETITION
&
REQUESTS
FOR
DISCLOSURE
21
j. Failing
to
provide
equipment
with
proper
guards
to
prevent
employees
from
entering
the
machinery;
k. Failing
to
inspect
equipment
for
defects,
disabled
safety
mechanisms,
lack
of
safety
mechanisms,
removed
guards,
or
lack
of
guards;
l. Failing
to
repair
unsafe
equipment;
m. Failing
to
provide
equipment
with
proper
safety
mechanisms
in
working
order
or
which
were
adequate
for
PLAINTIFF
MOSE
GUILLORY
to
do
his
job;
n. Failing
to
supervise
PLAINTIFF
MOSE
GUILLORY
while
he
was
operating
the
baler;
o. Failing
to
provide
PLAINTIFF
MOSE
GUILLORY
adequate
help
in
the
performance
of
work;
p. Failing
to
prevent
an
employee
from
causing
an
unreasonable
risk
of
harm
to
PLAINTIFF
MOSE
GUILLORY;
q. Failing
to
keep
PLAINTIFF
MOSE
GUILLORY
in
a
position
for
which
he
was
qualified
and
instead
ordering
PLAINTIFF
MOSE
GUILLORY
to
operate
a
machine
he
had
not
been
trained
to
operate;
r. Failing
to
adequately
train
PLAINTIFF
MOSE
GUILLORY
on
how
to
safely
operate
the
Harris
Baler;
s. Failing
to
adopt
proper
policies
and
procedures
regarding
maintenance
of
the
equipment
that
would
require
employees
to
fix
disabled
safety
mechanisms
and
guards;
t. Failing
to
adopt
proper
policies
and
procedures
for
safely
un-­‐jamming
or
dislodging
lodged
product
from
the
bins;
u. Failing
to
adopt
proper
policies
and
procedures
for
safely
extracting
additional
product
from
the
bins
and/or
the
baler;
v. Failing
to
provide
PLAINTIFF
with
safe
equipment
and/or
safety
equipment;
w. Failing
to
provide
English-­‐speaking
employees
to
train
and
advise
PLAINTIFF
on
how
to
safely
operate
the
Harris
Baler;
and
x. Failure
to
identify,
employee,
contract-­‐with,
delegate,
supervise,
and
manage
competent
vendor
management
and/or
employee-­‐leasing/employee-­‐staffing
companies
in
the
performance
of
their
duties.
62. IWORKS
DEFENDANTS’
and
WM
DEFENDANTS’
negligent
acts
directly
and
proximately
caused
injury
to
Plaintiff
MOSE
GUILLORY,
which
resulted
in
PLAINTIFFS’
damages
detailed
below.
PLAINTIFFS’
FIFTH
AMENDED
PETITION
&
REQUESTS
FOR
DISCLOSURE
22
63. PLAINTIFFS
seek
unliquidated
damages
within
the
jurisdictional
limits
of
this
Court.
XIV. COUNT
2:
NEGLIGENT
HIRING,
TRAINING,
SUPERVISION,
and/or
RETENTION
(IWORKS
DEFENDANTS
and
WM
DEFENDANTS
)
64. PLAINTIFFS
re-­‐allege
all
of
the
allegations
in
the
previous
paragraphs,
as
though
set
forth
fully
herein.
65. IWORKS
DEFENDANTS
and
WM
DEFENDANTS
are
liable
to
PLAINTIFFS
for
negligent
hiring,
training,
supervision,
and/or
retention.
66. Additionally,
IWORKS
DEFENDANTS
and
WM
DEFENDANTS
had
a
legal
duty
to
hire,
train,
supervise,
and/or
retain
competent
employees.
IWORKS
DEFENDANTS
and
WM
DEFENDANTS
also
had
a
legal
duty
to
terminate
incompetent
employees.
67. IWORKS
DEFENDANTS
and
WM
DEFENDANTS
breached
their
duties
when
IWORKS
DEFENDANTS
and
WM
DEFENDANTS
negligently
hired,
trained,
and
supervised
IWORKS
DEFENDANTS’
and
WM
DEFENDANTS’
tortfeasor-­‐employees
whom
breached
duties
to
PLAINTIFFS,
which
resulted
in
Plaintiff
MOSE
GUILLORY
injuries
and
PLAINTIFFS’
damages,
as
detailed
more
fully
below.
68. IWORKS
DEFENDANTS
and
WM
DEFENDANTS
also
breached
their
duties
when
Defendants
terminated
competent
employees
whom
could
have
prevented
the
incident
and/or
negligently
retained
incompetent
employees
whom
failed
to
prevent
the
incident,
which
resulted
in
Plaintiff
MOSE
GUILLORY
injuries
and
PLAINTIFFS’
damages,
as
detailed
more
fully
below.
69. IWORKS
DEFENDANTS’
and
WM
DEFENDANTS’
negligent
acts
directly
and
proximately
caused
injury
to
Plaintiff
MOSE
GUILLORY,
which
resulted
in
PLAINTIFFS’
damages
detailed
below.
PLAINTIFFS
seek
unliquidated
damages
within
the
jurisdictional
limits
of
this
Court.
XV. COUNT
3:
NEGLIGENCE
PER
SE
(IWORKS
DEFENDANTS
and
WM
DEFENDANTS)
70. PLAINTIFFS
re-­‐allege
all
of
the
allegations
in
the
previous
paragraphs,
as
though
set
forth
fully
herein.
PLAINTIFFS’
FIFTH
AMENDED
PETITION
&
REQUESTS
FOR
DISCLOSURE
23
71. IWORKS
DEFENDANTS
and
WM
DEFENDANTS
are
liable
to
PLAINTIFFS
for
negligence
per
se.
72. Additionally,
IWORKS
DEFENDANTS’
and
WM
DEFENDANTS’
negligence
violated
various
statutes,
ordinances,
and/or
administrative
regulations.
Specifically,
IWORKS
DEFENDANTS
and
WM
DEFENDANTS
violated
various
statutes
and
provisions
pertaining
to
the
Occupational
Safety
&
Health
Administration
(“OSHA”)
Act
of
1970—to
wit:
a. OSHA
Regulation
1926.20(b)(3),
which
provides
that
“[t]he
use
of
any
machinery,
tool,
material,
or
equipment
that
is
not
in
compliance
with
any
applicable
requirement
of
29
C.F.R.
1926
is
prohibited.
Such
machinery,
tool,
material,
or
equipment
shall
either
be
identified
as
unsafe
by
tagging
or
locking
the
controls
to
render
them
inoperable
or
shall
be
physically
removed
from
its
place
of
operation.”
29
C.F.R.
1926.20(b)(3).
b. OSHA
Regulation
1926.20(b)(4),
which
provides
that
the
“employer
shall
permit
only
those
employees
qualified
by
training
or
experience
to
operate
equipment
and
machinery”.
29
C.F.R.
1926.20(c)
(emphasis
added).
c. OSHA
Regulation
1926.21(b)(2),
which
provides
that
the
employer
“shall
instruct
each
employee
in
the
recognition
and
avoidance
of
unsafe
conditions
and
the
regulations
applicable
to
his
work
environment”.
29
C.F.R.
1926.21(b)(2)
(emphasis
added).
d. OSHA
Regulation
1910.145(f)(3),
which
provides
that
“[t]ags
shall
be
used
as
a
means
to
prevent
accidental
injury
or
illness
to
employees
who
are
exposed
to
hazardous
or
potentially
hazardous
conditions,
equipment,
or
operations
which
are
out
of
the
ordinary,
unexpected,
or
not
readily
apparent.”
29
C.F.R.
1910.145(f)(3)
(emphasis
added).
e. OSHA
Regulation
1910.147,
et
seq.,
which
mandates
the
use
of
lockout
and
tagout
procedures
and
provide
that
the
employer
“shall
establish
a
program
consisting
of
energy
control
procedures,
employee
training
and
periodic
inspections
to
ensure
that
before
any
employee
performs
any
servicing
or
maintenance
on
a
machine
or
equipment
where
the
unexpected
energizing,
startup
or
release
of
stored
energy
could
occur
and
cause
injury,
the
machine
or
equipment
shall
be
isolated
from
the
energy
source
and
rendered
inoperative.”
29
C.F.R.
1910.147(c)(1)
(emphasis
added).
f. OSHA
Regulation
1910.147(c)(7)(i)(B),
which
mandates
that
“[e]ach
affected
employee
shall
be
instructed
in
the
purpose
and
use
of
the
energy
control
procedure”
so
as
to
avoid
exposing
employees
to
unknown
hazards.”
See
29
C.F.R.
1910.147(c)(7)(i)(B).
g. OSHA
Regulations
1910.147(c)(6),
et
seq.,
which
mandate
the
following:
i. The
employer
shall
conduct
a
periodic
inspection
of
the
energy
control
procedure
at
least
annually
to
ensure
that
the
procedure
and
the
requirements
of
this
standard
are
being
followed.
1910.147(c)(6)(i).
PLAINTIFFS’
FIFTH
AMENDED
PETITION
&
REQUESTS
FOR
DISCLOSURE
24
ii. The
periodic
inspection
shall
be
performed
by
an
authorized
employee
other
than
the
ones(s)
utilizing
the
energy
control
procedure
being
inspected.
1910.147(c)(6)(i)(A).
iii. The
periodic
inspection
shall
be
conducted
to
correct
any
deviations
or
inadequacies
identified.
1910.147(c)(6)(i)(B).
iv. Where
lockout
is
used
for
energy
control,
the
periodic
inspection
shall
include
a
review,
between
the
inspector
and
each
authorized
employee,
of
that
employee's
responsibilities
under
the
energy
control
procedure
being
inspected.
1910.147(c)(6)(i)(C).
v. Where
tagout
is
used
for
energy
control,
the
periodic
inspection
shall
include
a
review,
between
the
inspector
and
each
authorized
and
affected
employee,
of
that
employee's
responsibilities
under
the
energy
control
procedure
being
inspected,
and
the
elements
set
forth
in
paragraph
(c)(7)(ii)
of
this
section.
1910.147(c)(6)(i)(D).
vi. The
employer
shall
certify
that
the
periodic
inspections
have
been
performed.
The
certification
shall
identify
the
machine
or
equipment
on
which
the
energy
control
procedure
was
being
utilized,
the
date
of
the
inspection,
the
employees
included
in
the
inspection,
and
the
person
performing
the
inspection.
1910.147(c)(6)(ii).
73. The
aforementioned
OSHA
regulations
are
designed
to
protect
a
class
of
persons
to
which
PLAINTIFF
MOSE
GUILLORY
belongs
(i.e.
employees
or
persons
working
at
a
job
site)
against
the
type
of
on-­‐the-­‐job
injury
suffered
by
PLAINTIFF
MOSE
GUILLORY.
74. Each
regulation
is
of
the
type
that
imposes
tort
liability.
75. IWORKS
DEFENDANTS’
and
WM
DEFENDANTS’
violations
of
the
above-­‐mentioned
regulations
were
without
legal
excuse.
76. IWORKS
DEFENDANTS’
and
WM
DEFENDANTS’
breach
of
the
duty
imposed
by
the
above-­‐
mentioned
regulations
proximately
caused
injury
to
Plaintiff
MOSE
GUILLORY,
which
resulted
in
PLAINTIFFS’
damages
detailed
below.
77. PLAINTIFFS
seek
unliquidated
damages
within
the
jurisdictional
limits
of
this
Court.
XVI. COUNT
4:
GROSS
NEGLIGENCE
(IWORKS
DEFENDANTS
and
WM
DEFENDANTS)
78. PLAINTIFFS
re-­‐allege
all
of
the
allegations
in
the
previous
paragraphs,
as
though
set
forth
fully
herein.
PLAINTIFFS’
FIFTH
AMENDED
PETITION
&
REQUESTS
FOR
DISCLOSURE
25
79. ALL
DEFENDANTS
are
liable
to
PLAINTIFFS
for
gross
negligence.
80. Defendants
owed
legal
duties
to
PLAINTIFFS,
as
detailed
in
the
Negligent-­‐based
counts
supra,
inter
alia.
81. Defendants
breached
their
duties
owed
to
PLAINTIFFS
through
Defendants’
negligent
activities,
actions,
and/or
inactions,
as
detailed
in
the
Negligence-­‐based
counts
supra,
inter
alia.
82. Defendants
consciously
and/or
deliberately
engaged
in
recklessness,
oppression,
willfulness,
wantonness
and/or
malice
through
Defendants’
actions
and/or
inactions,
which
entitles
PLAINTIFFS
to
punitive
and
exemplary
damages
under
Texas
Civil
Practice
&
Remedies
Code
section
41.003(a).
83. DEFENDANTS’
grossly
negligent
acts
and/or
omissions
directly
and
proximately
caused
injury
to
Plaintiff
MOSE
GUILLORY,
which
resulted
in
PLAINTIFFS’
damages
detailed
below.
84. Accordingly,
Defendants
should
be
held
liable
for
punitive
and
exemplary
damages
to
PLAINTIFFS.
85. PLAINTIFFS
also
seek
unliquidated
damages
within
the
jurisdictional
limits
of
this
court.
XVII. COUNT
5:
BREACH
OF
CONTRACT
(IWORKS
DEFENDANTS
AND
WM
DEFENDANTS)
86. PLAINTIFFS
re-­‐allege
all
of
the
allegations
in
the
previous
paragraphs,
as
though
set
forth
fully
herein.
87. IWORKS
DEFENDANTS
and
WM
DEFENDANTS
are
liable
to
PLAINTIFFS
for
breach
of
contract.
88. On
September
22,
2010
and
July
24,
2012,
respectively,
IWORKS
DEFENDANTS
and
WM
DEFENDANTS
executed
valid
and
enforceable
written
contracts.
See
Exhibits
A
and
B.
89. The
contracts
provided
that
IWORKS
DEFENDANTS
would
lease
employees
to
perform
work
for
WM
DEFENDANTS.
The
contracts
at
issue
also
expressly
or
impliedly
provided
that
WM
DEFENDANTS
and
IWORKS
DEFENDANTS
would:
a. Provide
a
reasonably
safe
workplace;
b. Establish
rules
and
regulations
for
worker
safety;
PLAINTIFFS’
FIFTH
AMENDED
PETITION
&
REQUESTS
FOR
DISCLOSURE
26
c. Warn
workers
of
the
hazards
of
his
employment;
d. Properly
train
workers;
e. Ensure
that
workers
had
been
properly
trained
before
assigning
them
to
a
task;
f. Certify
and/or
conduct
periodic
inspections
of
energy
control
procedures;
g. Provide
equipment
with
proper
guards
and
safety
mechanisms
that
were
adequate
and
in
working
order;
h. Supervise
workers
while
they
were
performing
tasks,
including
the
operation
of
machinery;
i. Ensure
that
workers
had
adequate
help
in
the
performance
of
work;
j. Ensure
that
workers
are
assigned
a
task
they
are
qualified
and
trained
to
perform;
k. Ensure
that
workers
are
trained
in
the
safe
and
proper
operation
of
all
heavy
equipment
operated
in
the
worker’s
assigned
task;
and
l.Identify,
employ,
contract-­‐with,
delegate,
supervise,
and
manage
competent
vendor
management
and/or
employee-­‐leasing/employee-­‐staffing
companies
in
the
performance
of
their
duties.
90. When
entering
into
the
contracts
at
issue,
IWORKS
DEFENDANTS
and
WM
DEFENDANTS
intended
to
secure
a
benefit
for
PLAINTIFF
MOSE
GUILLORY
and
entered
into
the
contracts
for
the
benefit
of
MOSE
GUILLORY
and
his
coworkers.
Thus,
PLAINTIFF
MOSE
GUILLORY
has
standing
to
enforce
the
aforementioned
contracts
executed
by
IWORKS
DEFENDANTS
and
WM
DEFENDANTS
because
PLAINTIFF
MOSE
GUILLORY
is
a
third-­‐party
beneficiary
of
those
contracts.
91. IWORKS
DEFENDANTS
and
WM
DEFENDANTS
each
breached
the
contracts
at
issue
in
the
following
non-­‐exclusive
ways:
a. Failing
to
provide
MOSE
GUILLORY
a
reasonably
safe
workplace;
b. Failing
to
establish
rules
and
regulations
for
MOSE
GUILLORY’s
safety;
c. Failing
to
warn
MOSE
GUILLORY
of
the
hazards
of
his
employment;
d. Failing
to
properly
train
MOSE
GUILLORY;
PLAINTIFFS’
FIFTH
AMENDED
PETITION
&
REQUESTS
FOR
DISCLOSURE
27
e. Failing
to
ensure
that
MOSE
GUILLORY
had
been
properly
trained
before
assigning
him
to
a
task;
f. Failing
to
certify
and/or
conduct
periodic
inspections
of
energy
control
procedures
for
MOSE
GUILLORY’s
safety;
g. Failing
to
provide
MOSE
GUILLORY
equipment
with
proper
guards
and
safety
mechanisms
that
were
adequate
and
in
working
order;
h. Failing
to
supervise
MOSE
GUILLORY
while
he
was
performing
tasks,
including
operating
the
Harris
Centurion
Baler;
i. Failing
to
ensure
that
MOSE
GUILLORY
had
adequate
help
in
the
performance
of
his
work;
j. Failing
to
ensure
that
MOSE
GUILLORY
was
assigned
to
a
task
he
qualified
and
trained
to
perform;
k. Failing
to
ensure
that
MOSE
GUILLORY
was
trained
in
the
safe
and
proper
operation
of
all
heavy
equipment
operated
in
MOSE
GUILLORY’s
assigned
task,
including
the
Harris
Centurion
Baler;
and
l. Failing
to
identify,
employ,
contract-­‐with,
delegate,
supervise,
and
manage
competent
vendor
management
and/or
employee-­‐leasing/employee-­‐staffing
companies
in
the
performance
of
their
duties.
92. IWORKS
DEFENDANTS
and
WM
DEFENDANTS
were
unjustly
enriched
by
IWORKS
DEFENDANTS’
and
WM
DEFENDANTS’
breaches.
93. IWORKS
DEFENDANTS’
and
WM
DEFENDANTS’
breaches
proximately
caused
injury
to
Plaintiff
MOSE
GUILLORY,
which
resulted
in
PLAINTIFFS’
damages
detailed
below.
94. PLAINTIFFS
seek
unliquidated
damages
within
the
jurisdictional
limits
of
this
Court.
95. PLAINTIFF
MOSE
GUILLORY
is
entitled
to
recover
reasonable
attorney
fees
under
Texas
Civil
Practice
&
Remedies
Code
Chapter
38
because
this
suit
is
for
breach
of
written
contracts.
PLAINTIFF
MOSE
GUILLORY
retained
counsel,
who
presented
PLAINTIFF’s
claim
to
IWORKS
DEFENDANTS
and
WM
DEFENDANTS.
DEFENDANTS
did
not
tender
the
amount
owed
within
30
days
of
when
the
claim
was
presented.
PLAINTIFFS’
FIFTH
AMENDED
PETITION
&
REQUESTS
FOR
DISCLOSURE
28
XVIII. DAMAGES
96. DEFENDANTS’
activities,
actions,
and/or
inactions,
as
detailed
above,
directly
and/or
proximately
caused
injury
to
PLAINTIFFS,
which
include
the
following:
a. Pain
and
suffering
in
the
past
and
future
b. Mental
anguish
in
the
past
and
future.
c. Physical
disfigurement
in
the
past
and
future.
d. Physical
impairment
in
the
past
and
future.
e. Medical
expenses
in
the
past
and
future.
f. Loss
of
past
earning
capacity.
g. Loss
of
future
earning
capacity.
h. Loss
of
consortium
in
the
past
and
future.
i. Loss
of
household
services
in
the
past
and
future.
j. Consequential
and/or
incidental
damages.
k. Other
unliquidated
damages
within
the
jurisdictional
limits
of
this
Court.
l. Exemplary
damages
under
Texas
Civil
Practice
&
Remedies
Code
section
41.003(a).
m. Contract
damages
including
but
not
limited
to
restitution
and
profit
disgorgement.
n. Nominal
damages.
o. Attorneys’
fees,
as
permitted
by
law.
p. Pre-­‐judgment
interest
and
post-­‐judgment
interest.
TEXAS
FINANCE
CODE
§304.001,
et
seq.,
and
any
other
applicable
law.
XIX. JURY
DEMAND
97. PLAINTIFFS
demand
a
jury
trial
and
tender
the
appropriate
fee
with
this
petition.
PLAINTIFFS’
FIFTH
AMENDED
PETITION
&
REQUESTS
FOR
DISCLOSURE
29
XX. CONDITIONS
PRECEDENT
98. All
conditions
precedent
to
PLAINTIFFS’
claims
for
relief
have
been
performed
or
have
occurred.
XXI. REQUEST
FOR
DISCLOSURE
99. Under
Texas
Rule
of
Civil
Procedure
194,
PLAINTIFFS
request
that
DEFENDANTS
disclose
the
information
or
material
described
in
Rule
194.2.
XXII. PRAYER
100. WHEREFORE,
PREMISES
CONSIDERED,
PLAINTIFFS
ask
that
Defendants
be
cited
to
appear
and
answer
and,
on
final
trial,
that
PLAINTIFFS
be
awarded
a
judgment
against
IWORKS
PERSONNEL,
INC.,
LUIS
TREVINO,
HAYDEE
GUTIERREZ,
and
WM
DEFENDANTS
for
PLAINTIFFS’
damages
and
for
all
other
relief
to
which
PLAINTIFFS
are
entitled
at
law
and
in
equity.
Respectfully
submitted,
GILDE
LAW
FIRM
________________________________________________
BRADFORD
J.
GILDE
TSB#:
24045941
NICHOLAS
A.
HOMAN
TSB#:
24083194
55
Waugh
Dr.,
Suite
850
Houston,
TX
77007
281-­‐973-­‐2771
–
facsimile
281-­‐973-­‐2772
–
phone
bjg@gildelawfirm.com
PLAINTIFFS’
FIFTH
AMENDED
PETITION
&
REQUESTS
FOR
DISCLOSURE
30
CERTIFICATE
OF
SERVICE
I
hereby
certify
that
a
true
and
correct
copy
of
the
foregoing
has
been
served
to
all
counsel
of
record
via
TexFile
on
this
13th
day
of
June,
2014.
______________________________________________
BRADFORD
J.
GILDE
PLAINTIFFS’
FIFTH
AMENDED
PETITION
&
REQUESTS
FOR
DISCLOSURE
31
EXHIBIT
A
PLAINTIFFS’
FIFTH
AMENDED
PETITION
&
REQUESTS
FOR
DISCLOSURE
32
WMRA 000022
WMRA 000023
WMRA 000024
WMRA 000025
WMRA 000026
WMRA 000027
WMRA 000028
WMRA 000029
WMRA 000030
WMRA 000031
WMRA 000032
WMRA 000033
WMRA 000034
EXHIBIT
B
PLAINTIFFS’
FIFTH
AMENDED
PETITION
&
REQUESTS
FOR
DISCLOSURE
33
iWorks Personnel Inc. Resp to P RFP00002
Case No. 201261407
MOSE A. GUILLORY AND MARY § IN THE DISTRICT COURT OF
GUILLORY §
§ HARRIS COUNTY, TEXAS
V. §
§
IWORKS PERSONNEL, INC, ET AL. § 113TH JUDICIAL DISTRICT
IWORKS PERSONNEL, INC.’S
PLEA TO THE JURISDICTION
DEFENDANTS, iWORKS PERSONNEL, INC., LUIS TREVINO, and HAYDEE
GUTIERREZ (hereinafter “IWORKS”) file this Plea to the Jurisdiction. In support thereof
it would show this honorable Court the following:
I.
Introduction
This is a worker’s compensation case. IWORKS has prefaced almost every
pleading it has filed with this assertion. This is because, to date, the great bulk of legal
efforts expended in this case are the direct result of Plaintiffs’ numerous and continued
attempts to circumvent the Texas Labor Code in the face of well settled law and clear
public policy dictating otherwise. For well over a year Plaintiff’s counsel has had two
separate worker’s compensation policies which would provide him with worker’s
compensation coverage. See Exhibit A (iWORKS’) and Exhibit B (Waste Management’s).
Nevertheless, Plaintiff has refused to file a claim on either policy even though he would
begin receiving benefits within fifteen days and despite the fact that this is what is required
by the Texas Labor Code.
iWORKS has consistently asserted that 1) it is a subscriber to worker’s
compensation insurance, and 2) that Waste Management is responsible for the worker’s
compensation coverage for Guillory because a) it executed a hold harmless agreement
related to Guillory’s employment, and b) it is solely responsible for moving Guillory from
the duties he was assigned to perform by iWORKS (operation of a front-end loader) and
placing him in operation of a machine (the Harris Baler) without any notice to iWORKS,
for failing to provide Guillory with the training and supervision necessary to operate the
Harris Baler safely, and for controlling the scope, manner and details of Guillory’s work in
a negligent fashion. For these reasons, iWORKS did not initiate a worker’s compensation
claim related to Guillory’s work-place injury. Moreover, to the best knowledge of iWORKS,
Waste Management has not filed an Employer’s First Report of Injury or Illness (Form
DWC-001) with its worker’s compensation carrier, Indemnity Insurance Company of North
America (“IICNA”).
In order to put this matter on the administrative path it should have been on from
its inception, iWORKS has filed an Employers First Report of Injury or Illness (Claim #
1420000952677) with its worker’s compensation carrier, Texas Mutual Insurance
Company (“TMIC”).1 See Exhibit C. The compensability of Guillory’s injury is now being
determined by TMIC claims adjuster Patricia Westin. It is very likely that Texas Mutual
will seek some form of contribution from IICNA. In the event of an adverse compensability
finding iWORKS will instigate a Benefit Review Conference with the Texas Department
of Insurance – Division of Worker’s Compensation (“DWC”)2, the first step in exhausting
the administrative remedies necessary to pursue judicial review.
1 By filing a claim on its worker’s compensation insurance, iWORKS does NOT waive or otherwise retreat
from its position that Guillory’s injury is the sole responsibility of Waste Management and/or Guillory and
expressly reserves its rights to raise these issues in the administrative proceedings (if any) and any judicial
review of any administrative determinations.
2 In 2005, the Legislature abolished the Texas Workers’ Compensation Commission and transferred its
functions to the Texas Department of Insurance-Division of Worker’s Compensation. See Act of May 29,
2005, 70th Leg., R.A., ch. 265, § 8.001, 2005 Tex. Gen. Laws 469, 607-08. For ease of reference Movant
2
The DWC has exclusive jurisdiction over this matter. Plaintiffs’ have not exhausted
their administrative remedies. Thus, this Court lacks subject-matter jurisdiction and
should dismiss Plaintiffs’ causes of action.
II.
Evidence in Support of iWORKS’ Plea to the Jurisdiction
Exhibit A – iWORKS’ Workers’ Compensation Policy
Exhibit B – Waste Management’s Workers’ Compensation Policy.
Exhibit C – Employer’s First Report of Injury or Illness (DWC-001) filed by
Exhibit D – Hold Harmless Agreement
Exhibit E – Employee’s Claim for Compensation for a Work-Related Injury or
Occupational Disease (DWC-041) executed Guillory
Exhibit F – Affidavit of Luis Trevino
III.
Factual Background
IWORKS is a temporary staffing company based out of San Antonio, Texas. It
provides temporary employees to companies throughout Texas for assignments as short
as one day or as long as six months. IWORKS’ duty is to recruit, screen, interview, and
assign its employees to perform the type of work requested by its clients. The work is to
be performed at its client’s facilities and under its client’s direct supervision. IWORKS
also pays the employee’s wages, pays, withholds and transmits payroll taxes, provides
unemployment insurance and worker’s compensation benefits, and handles any
unemployment and worker’s compensation claims for employees we assign to its clients.
IWORKS is not licensed as a staff leasing agency and has never offered staff leasing
will refer to any reference to the Division of Worker’s Compensation or any of its predecessor agencies as
“DWC.”
3
services. Nor has it ever provided any PEO services. Its sole business is recruiting and
assigning temporary workers as required by its clients. IWORKS provides no site specific
training to the temporary workers that it provides to its clients. IWORKS does not
supervise any of the work performed at its client’s sites. IWORKS has no control over its
client’s facilities or equipment.
One of IWORKS’ clients was Waste Management, Inc. (“Waste Management”).
In July 2012, Waste Management contacted IWORKS’ Houston branch requesting a
temporary employee who was qualified to operate a front-end loader at Waste
Management’s Gasmer facility. The provision of heavy equipment operators is not an
area in which IWORKS does a lot of business. Therefore, as a condition of procuring
such employees for Waste Management, IWORKS and Waste Management agreed that
IWORKS would locate temporary employees who had experience operating front-end
loaders, but that it would be Waste Management’s responsibility to ensure that
employees supplied by IWORKS were trained in the safe and proper operation of all
heavy equipment to be operated in their assigned task. IWORKS and Waste
Management also agreed that Waste Management would be solely responsible for any
damages related to the operation of the heavy machinery at the Waste Management
facility by an IWORKS temporary employee, and that Waste Management would hold
IWORKS harmless in the event there was a claim made against them related to the
operation of heavy machinery by an IWORKS temporary employee. See Exhibit D.
Mose Guillory applied for temporary work with IWORKS and indicated that he had
experience operating a front-end loader. IWORKS instructed him to report to Waste
Management’s Gasmer facility to be evaluated. Waste Management reported to
4
IWORKS that Guillory had sufficient skill and experience operating a front-end loader
and Guillory began working at the Waste Management Gasmer facility. From that point
forward IWORKS sole responsibility was to pay Guillory based upon the time sheets
submitted by Guillory’s Waste Management supervisors.
IWORKS did not control any aspect whatsoever of Guillory’s work at the Waste
Management facility; Waste Management had sole control over the manner and details
of Guillory’s work. IWORKS did not control or even participate in evaluating whether or
not Guillory possessed sufficient skill to operate a front-end loader; Waste Management
had sole control in determining whether or not Guillory possessed sufficient skill.
IWORKS did not control any site-specific training for Guillory; Waste Management had
sole control over any site-specific training that Guillory may have needed to perform his
duties at Waste Management’s Gasmer facility.
The following undisputed facts are alleged in Plaintiff’s Fifth Amended Original
Petition:
 Waste Management hired IWORKS to locate temporary employees to work at Waste
Management’s Gasmer facility. Petition3, p. 11, ¶26; Petition, Exhibit A
 As a condition of procuring such employees IWORKS and Waste Management
executed an agreement which specified that Waste Management was solely
responsible for ensuring that the candidates were sufficiently trained in the operation
of the heavy machinery. Id., p. 11, ¶26; Petition, Exhibit B
 On July 9, 2012 Guillory applied for a job at IWORKS. Id., p. 11, ¶ 27.
 Guillory was assigned to operate a front-end loader at the Waste Management facility
located at 4939 Gasmer Dr., Houston, Texas. Id., p. 11, ¶ 29.
 iWORKS does not provide site specific training as that is the duty of the client
company. Id., p. 15, ¶ 41.
3 Unless otherwise indicated, “Petition” refers to Plaintiff’s Fifth Amended Petition.
5
 When Guillory reported to the Gasmer facility on July 9th he was required to
demonstrate his proficiency in driving a front-end loader to a Waste Management
employee. Id.
 Waste Management was responsible for determining whether or not Guillory had
sufficient experience, training, and skill to operate a front-end loader at Waste
Management’s Gasmer facility. Id., p. 11, ¶ 29, p. 14, ¶¶ 40-41.
 Waste Management employee Abraham Hernandez determined that Guillory was
sufficiently skilled in operating a front-end loader and instructed him to report for work
on July 10, 2012. Id.
 Guillory operated the front-end loader at the Gasmer facility on the day shift from
roughly July 10, 2012 to July16, 2012. Id., p. 12, ¶ 30.
 Soon thereafter Guillory moved to the night shift at the Gasmer facility. Id.
 While working on the night shift Waste Management instructed Guillory to operate a
Harris Baler. Id., ¶ 31.
 On August 5, 2012 Guillory reported for work on the night shift and began to operate
the Harris Baler. Petition, p. 13, ¶ 36.
 During this shift Guillory climbed into the baler which engaged while he was in there,
severing his right leg below the knee and severing a portion of his left foot. Id.
IV.
Arguments & Authorities
A. This Court does not have subject-matter jurisdiction.
This Court does not have subject-matter jurisdiction over Plaintiffs’ claims related
to his injury at work. Without subject-matter jurisdiction this Court cannot render a valid
judgment in this matter. City of Houston v. Rhule, 417 S.W.3d 440, 442 (Tex. 2014, per
curium) (“Subject matter jurisdiction is ‘essential to a court’s power to decide a case’”
quoting Bland Indep. Sch. Dist. v. Blue, 34 S.W.3d 547, 553–54 (Tex.2000)). Subject-
matter jurisdiction cannot be waived, nor can it be given or taken away by consent. Carroll
v. Carroll, 304 S.W.3d 366, 367 (Tex. 2010); see Rhule, 417 S.W.3d at 442 (“A judgment
6
rendered without subject matter jurisdiction cannot be considered final” citing Dubai
Petrol. Co. v. Kazi, 12 S.W.3d 71, 76 (Tex.2000)).
Lack of subject-matter jurisdiction makes a judgment void, not just voidable. In Re
United Servs. Auto Ass’n, 307 S.W.3d 299, 209 (Tex. 2010). Lack of subject-matter
jurisdiction is fundamental error and can be raised at any time. Tex. Worker’s Comp.
Comm’n v. Garcia, 893 S.W.2d 504, 517 n.15 (Tex. 1995) (noting that a trial court can
question its subject-matter jurisdiction even without a motion by either party). Lack of
subject-matter jurisdiction can even be raised for the first time on appeal. Waco ISD v.
Gibson, 22 S.W.3d 849, 851 (Tex. 2000); see Rhule, 417 S.W.3d at 442 (“Not only may
a reviewing court assess jurisdiction for the first time on appeal, but all courts bear the
affirmative obligation ‘to ascertain that subject matter jurisdiction exists regardless of
whether the parties have questioned it.’” quoting In re United Servs. Auto. Ass'n, 307
S.W.3d 299, 306 (Tex.2010)). Furthermore, the failure to grant a plea to the jurisdiction
for failure to exhaust administrative remedies with the DWC is subject to mandamus
review. In Re Liberty Mut. Fire Ins. Co., 295 S.W.3d 327, 328 (Tex. 2009) (orig.
proceeding) (per curiam); In Re Liberty Ins. Corp., 321 S.W.3d 630 (Tex.App.—Houston
[14th Dist.] 2010) (orig. proceeding).
B. The Division of Workers’ Compensation has exclusive jurisdiction.
This is a worker’s compensation case and falls under the exclusive jurisdiction of
the Texas Department of Insurance – Division of Worker’s Compensation. As such, this
court lacks subject-matter jurisdiction to adjudicate Plaintiffs’ claims until Plaintiffs have
exhausted their administrative remedies through the DWC.
7
An agency has exclusive jurisdiction “when a pervasive regulatory scheme
indicates that Congress intended for the regulatory process to be the exclusive means of
remedying the problem to which the regulation is address.” Subaru of Am. v. David
McDavid Nissan, Inc., 84 S.W.3d 212, 221 (Tex. 2002); In Re Mid-Century Ins. Co. of
Tex., 426 S.W.3d 169, 172 (Tex.App.—Houston [1st Dist] 2012) (orig. proceeding) (“An
agency has exclusive jurisdiction . . . when a pervasive regulatory scheme reflects
legislative intent that an agency have the sole power to make the initial determination in
the dispute.”) Exclusive jurisdiction is a question of law that turns on statutory
interpretation. See Rhule, 417 S.W.3d at 442 (citing Subaru, 84 S.W.3d at 221. The
Texas Supreme Court held in Saenz v. Fidelity & Guaranty Insurance Underwriters4 that
“the Workers’ Compensation Act vests the power to award compensation benefits solely
in the [DWC]. . ., subject to judicial review.” Saenz, 925 S.W.2d at 612.
In Tex. Mut. Ins. Co. v. Ruttiger5 the Texas Supreme Court discussed the
significant changes the Legislature made to the Worker’s Compensation Act6 (“Act”) in
19897. It noted that the “amendments included significant reforms, among which were
changes in how to calculating benefits for injured workers, the amount of income benefits
workers could recover, the dispute resolution process, the addition of an ombudsman
program to provide assistance for injured workers who had disputes with insurers, and
increasing sanctions for violations of the Act.” Id., 381 S.W.2d at 433. The Ruttiger court
4 925 S.W.2d 607 (Tex. 1996)
5 381 S.W.3d 430 (Tex. 2012).
6 Tex. Lab. Code §§ 401.001 – 506.002.
7 The Ruttiger opinion addressed the viability of a common-law cause of action for breach of the duty of
good faith and fair dealing against a worker’s compensation carrier, a cause of action previously approved
of by the Texas Supreme Court in Arranda v. Ins. Co. of North Amer., 748 S.W.2d 210 (Tex. 1988). The
Ruttiger court held that the 1989 amendments to the Act manifested the Legislatures’ intent to vitiate the
need for such a cause of action and expressly overruled Arranda. Id., 381 S.W.3d at 438-56.
8
stated that “[t]he purpose of the Act is to provide employees with certainty that their
medical bills and lost wages will be covered if they are injured.” Id. at 441.
To accomplish these purposes, the Act provides detailed notice and
administrative dispute resolution proceedings that include specific
deadlines and incorporate a “conveyor-belt” approach. That is, once the
administrative dispute resolution process is initiated, a dispute continues
through the process until the dispute is resolved either by the parties or by
a binding decision through the resolution procedures.
Id. at 441.
The Ruttiger opinion provides a lengthy description of “the detailed notice and
administrative dispute resolution proceedings” encompassed by the Act. Id. at 441-43.
In describing the pervasiveness of the Act the Ruttiger court noted that the Act affords the
DWC significant power to enforce the Act against the various parties in the worker’s
compensation system. Id. The Ruttiger court concluded:
It is apparent that the Act prescribes detailed, WCD-supervised, time-
compressed processes for carriers to handle claims and for dispute
resolution. It has multiple, sometimes redundant but sometimes additive,
penalty and sanction provisions for enforcing compliance with its
requirements.
Id. at 443. The court recognized that allowing an employee to circumvent the act by
asserting common law causes of action would be “inconsistent with the Act’s goals and
legislative intent exhibited in the act” and could also “result in rewarding an employee who
is dilatory in utilizing the Act’s detailed dispute resolution procedures, regardless of
whether the delay was intentional or inadvertent, because whether and when the dispute
resolution begins is by and large dependent on the employee.” Id.
The number of appellate decisions recognizing the DWC’s exclusive jurisdiction
over work-place injuries is voluminous. Both Houston Courts of Appeal have recognized
the DWC’s exclusive jurisdiction. The Fourteenth held that “[t]he Workers’ Compensation
9
Act vests the Workers’ Compensation Division with exclusive jurisdiction to determine a
claimant’s entitlement to medical benefits.” In Re Liberty Insurance Corporation, 321
S.W.3d 630, 636 (Tex.App.—Houston [14th Dist.] 2010, orig. proceeding) (granting
Relator’s petition for mandamus relief and dismissing Plaintiff’s case for lack of
jurisdiction). Likewise, the First District held that “[t]he Worker’s Compensation Act gives
the DWC exclusive jurisdiction over certain workers’ compensation disputes relating to
entitlement to medical benefits, preauthorization of medical care and reimbursement of
medical expenses.” In Re Mid-Century Ins. Co. of Tex., 426 S.W.3d 169, 172 (Tex.App.—
Houston [1st Dist.] 2012, orig. proceeding) (granting Relator’s petition for mandamus).
C. Plaintiff has not exhausted his administrative remedies.
When an agency has exclusive jurisdiction a party must exhaust its administrative
remedies before seeking recourse through judicial review. Rhule, 417 S.W.2d at 442
(citing Cash Am. Int’l., Inc. v. Bennett, 35 S.W.3d 12, 15 (Tex. 2000); Cunningham
Lindsey Claims Mgmt. v. Snyder, 291 S.W.3d 472, 477 (Tex.App.—Houston [14th Dist.]
2009, pet. denied) (“If an agency has exclusive jurisdiction. . . a party must first exhaust
all administrative remedies before a trial court has subject matter jurisdiction.”). “Absent
exhaustion of administrative remedies, a trial court must dismiss the case.” Rhule, 417
S.W.2d at 442 (citing Tex. educ. Agency v. Cypress-Fairbanks I.S.D., 830 S.w.2d 88, 90
(Tex. 1992). There is no question that Guillory has not exhausted his administrative
remedies through the DWC. The question before this court is, “Why?”
Guillory was injured on August 5, 2012. Approximately two weeks later, he
executed a claim form requesting compensation for a work-related injury. See Exhibit E.
On that form he stated that he was represented by Bradford J. Gilde. Id. Thus, fifteen
10
days after his work-related injury (over 2 ½ years ago) Guillory was at a minimum aware
of the potential availability of worker’s compensation benefits. It is also fair to assume
that his legal representative knew (or had the ability to find out) how to obtain those
benefits. As was stated above, for almost two years Guillory has had two separate
worker’s compensation policies by which he could have sought benefits. Yet he has made
no effort to invoke his rights under either policy.
This court has found as a matter of law that Guillory’s claims against Waste
Management are barred by the “comp bar” defense, yet Guillory still refuses to file a claim
on Waste Management’s worker’s compensation policy. The Texas Supreme Court held
in Port Elevator-Brownsville, L.L.C. v. Casados, 358 S.W.3d 238 (Tex., 2012) that a
company cannot segregate its temporary employees and permanent employees for
purposes of coverage under its worker’s compensation policy. The Casados court further
noted that:
[P]remiums are an issue between the employer and the insurer; they do not
affect the employee's coverage. Tex. Emp'rs' Ins. Ass'n v. Stanton, 140
S.W.2d 337, 339–40 (Tex.Civ.App.-Amarillo 1940, writ. ref'd) (“[T]he failure
to pay the premiums which may be due upon a policy is a matter of no
importance as between the insurer and the employee but only concerns the
insurer and the employer.”). If Port Elevator's policy had set out certain
premiums solely for temporary workers and Port Elevator had not paid those
premiums, Casados would still have been covered under the policy and the
failure to pay premiums would be an issue between Port Elevator and Texas
Mutual. See Coal Operators Cas. Co. v. Richardson, 414 S.W.2d 735, 738
(Tex.Civ.App.—Beaumont 1967, writ ref'd n.r.e.) (“This [workers'
compensation] protection to plaintiff was not lost because his employer
failed to pay the proper premium to the insurance company.”).
Id. at 243-44. Thus, Guillory is covered under Waste Management’s worker’s
compensation policy as a matter of law. This may be another reason why Waste
11
Management has failed to invoke its rights under the Act. See discussion, infra, n. 8
(below).
The only plausible explanation for Guillory’s failure to even try to claim his benefits
under the Texas Workers’ Compensation Act is that he and his counsel decided early in
the course of this litigation to try and circumvent the worker’s compensation system in an
attempt to recover common law damages. Given the extreme nature of Guillory’s injury
it is understandable why he would prefer common law remedies. However, this approach
flies in the face of long standing legal precedence and well-established public policy. As
the Ruttiger court stated, “the extra-statutory cause of action provides incentive for an
injured worker to delay using the avenues for immediate relief that the Legislature
painstakingly built into the law” and “distorts the balances struck in the Act and frustrates
the Legislature’s intent to have disputes resolved quickly and objectively.” Ruttiger, 381
S.W.3d at 451. That is what happened in this case.8
This is not a factually complicated matter; the basic underlying facts are, for the
most part, undisputed. However, in his attempt to circumvent the worker’s compensation
system, Guillory has had to assert highly questionable causes of action and include
parties that simply have no business being in this litigation. As a result this litigation has
burgeoned into an unnecessarily complicated and contentious morass. It has even
resulted in an award of substantial attorney fees being assessed against Guillory, himself.
Nevertheless, Guillory continues down this untenable path fearing that any recognition by
8 Fairness demands that the same inquiry be directed at both iWORKS and Waste Management: why didn’t
either one of them file a claim with their worker’s compensation carrier? iWORKS’ position is stated, supra,
at p. 1-2. iWORKS’ understanding of Waste Management’s position is that the Hold Harmless Agreement
is unenforceable and that iWORKS has a contractual duty to provide the worker’s compensation coverage
for Guillory. This question is now moot given that iWORKS has filed a claim with TMIC and has begun the
administrative process required by the Act.
12
him of a viable worker’s compensation claim will preclude him from his questionable
attempt at recovering common law damages for his work-place injury. This is not how
the State of Texas wants work-place injuries to be resolved. “[P]arties cannot avoid
exhaustion of administrative remedies because they fear they might not prevail.” In Re
Liberty Mut. Fire Ins. Co., 295 S.W.3d 327 329 (Tex. 2009).
The Corpus Christi Court of Appeals provides a concise description of the
administrative process required to exhaust the DWC administrative remedies.
The Texas Workers' Compensation Act provides a four-tiered system for
the disposition of claims by the DWC. See TEX. LAB. CODE ANN. §§ 410.021–
.308 (West 2006 & Supp. 2010). In the first tier, the parties participate in a
“benefit review conference” conducted by a “benefit review officer.” TEX.
LAB. CODE ANN. §§ 410.021–.034 (West 2006 & Supp.2010). The
conference, which is a “nonadversarial, informal dispute resolution
proceeding,” is designed to inform the parties regarding the procedures
regarding a claim, discuss the facts and issues pertaining to the claim, and
“mediate and resolve disputed issues by agreement of the parties.” Id. §
410.021(3) (West 2006). “A dispute may be resolved either in whole or in
part at a benefit review conference.” Id. § 410.029(a) (West 2006). If the
conference results in the resolution of disputed issues or in a settlement,
the benefit review officer reduces the agreement to writing and the parties
and the officer sign the agreement. Id. § 410.029(b) (West 2006). If the
parties fail to resolve all parts of a dispute at the benefit review conference,
the benefit review officer similarly prepares a written report that delineates
the status of the case. Id. § 410.031 (West 2006).
In the second tier, “[i]f issues remain unresolved after a benefit review
conference,” the parties may agree to arbitrate, and absent such an
agreement, the parties may seek relief at a “contested case” hearing. Id. §§
410.104, 410.151–.169 (West 2006). In the third tier, a party may seek
review by an administrative appeals panel. Id. §§ 410.201–.208 (West
2006). Finally, in the fourth tier, a party that has exhausted its administrative
remedies may seek judicial review. Id. §§ 410.251–.308 (West 2006).
In Re New Hampshire Ins. Co., 360 S.W.3d 597 (Tex. App.—Corpus Christi 2011, pet.
denied). This is the process that Guillory must exhaust. Only after Guillory has availed
himself of these administrative remedies may he seek redress in this Court.
13
D. The DWC has exclusive jurisdiction to determine coverage in this matter.
Guillory claims that both iWORKS and Waste Management are non-subscribers.
See Petition, p. 6, ¶¶ 19-20. iWORKS contends that it had a worker’s compensation policy
in effect at the time of Guillory’s injury. See Exhibit F.9 By raising this coverage issue
Plaintiff hopes to thwart the “worker’s comp bar”10 and avoid resolution of this matter
through the DWC. However, this approach does not comport with Texas law. The DWC
has both the exclusive authority and the administrative ability to resolve these issues.
The DWC routinely addresses these types of issues through its administrative
proceedings. See e.g. Ins. Co. of Pa. v. Hartford Underwriters Ins. Co., 164 S.W.3d 747
(Tex.App.—Houston [14th Dist.] 2005, no pet.) (“Though we are not bound by the
decisions [of the DWC], we find them instructive . . . . “); Houston Gen. Ins. Co. v. Ass’n
Cas. ins. Co., 977 S.W.3d 634, 636 (Tex.App.—Tyler 1998, no pet.) (noting that
administrative decisions, while not binding, are entitled to substantial weight).
In Appeals Panel No. 03066011 (Division of Worker’s Compensation, April 28,
2003) the DWC appeals panel addressed a temporary staffing situation and determined
which employer was liable, the proper application of the Staff Leasing Services Act12
(“SLSA”), and approved the use of the borrowed servant doctrine in determining liability.
9 Exhibit F is the Affidavit of Luis Trevino which is incorporated by reference as if set forth in full herein.
10 The Texas Workers' Compensation Act provides that the "exclusive remedy of an employee covered by
workers' compensation insurance coverage" for a work-related injury is "recovery of workers' compensation
benefits" as provided under the Act. TEX. LAB. CODE ANN. § 408.001(a).
11 DWC Appeals Panel decisions are available on the Texas Department of Insurance website at
http://www.tdi.texas.gov/appeals. Copies of the Appeals Panel decisions cited in this brief are attached
hereto in an Appendix.
12 TEX. LABOR CODE, Chapter 91 (“STAFF LEASING SERVICES”). The Texas Legislature amended Chapter 91
in 2013 renaming it “PROFESSIONAL EMPLOYMENT ORGANIZATIONS”. This amendment supports iWORKS’
opposition to Plaintiff’s proposition that it is a staff leasing company. Rather, iWORKS temporary
14
In Appeals Panel No. 021771 (Division of Worker’s Compensation, September 3,
2002) the appeals panel addressed a matter factually similar to this case analyzing the
interplay between the contractual obligations between a staffing company and its client
company, the applicability of the SLSA, and the application of the borrowed servant
doctrine to determine coverage. The appeals panel upheld the hearing officer’s
determination that the client company was responsible for the worker’s injury rather than
the staffing company. The panel held that:
Texas courts have recognized that a general employee of one employer
may become the borrowed servant of another employer. The determinative
question then becomes which employer had the right of control of the details
and manner in which the employee performed the necessary services. Carr
v. Carroll Company, 646 S.W.2d 561 (Tex. App.-Dallas 1982, writ ref'd
n.r.e.). We note that in Texas Workers’ Compensation Insurance Fund v.
DEL Industrial, Inc., 35 S.W.3d 591 (Tex. 2000), the court held that the Staff
Services Leasing Act (SSLA), Texas Labor Code Chapter 91, supersedes
the common law right-of-control test in determining employer status of
leased employees for workers’ compensation purposes. However,
(Employer 2) was not licensed under the SSLA. The hearing officer
determined that on the date of injury, (Employer 2) was a licensed provider
of temporary common workers under Chapter 92 of the Texas Labor Code,
entitled Temporary Common Worker Employers (TCWE). In Richmond v. L.
D. Brinkman & Co. (Texas) Inc., 36 S.W.3d 903 (Tex. App.-Dallas 2001,
pet. denied), the court determined that the common law right-of-control test
is not superseded by Chapter 92 (TCWE) of the Texas Labor Code. The
hearing officer is the sole judge of the weight and credibility of the evidence.
Section 410.165(a). We conclude that the hearing officer did not err in
applying the right-of-control test and in determining that at the time of the
injury, the claimant was the borrowed servant of (Employer 1). The hearing
officer’s decision is supported by sufficient evidence and is not so against
the great weight and preponderance of the evidence as to be clearly wrong
and unjust. Cain v. Bain, 709 S.W.2d 175 (Tex. 1986).
employment service as set forth in Chapter 93 of the TEXAS LABOR CODE. Furthermore, effective September
1, 2013, TEX. LABOR CODE § 93.004(a) holds that a Certificate of Insurance “constitutes proof of workers’
compensation insurance coverage for the temporary employment service and the client of the temporary
employment service with respect to all employees of the temporary employment services assigned to the
client.” Subsection (a) further holds that “[t]he state or political subdivision of the state shall accept a
certificate of insurance coverage described by this section as proof of worker’s compensation coverage
under Chapter 406.”
15
Id. at p. 1-2. The client company also argued that the staffing company should be
responsible because the client company paid fees to the staffing company which went
towards worker’s compensation coverage for the temporary employees. The panel
rejected these arguments. Id.
In Appeals Panel No. 101718 (Division of Worker’s Compensation, March 21,
2011) the appeals panel examined a complex claim involving a contractor, a
subcontractor, a PEO, and a temporary staffing company. In finding that the employee
did not suffer a compensable injury the panel had to address issues related to coverage
(including whether or not the temporary staffing company’s carrier properly terminated
coverage), contractual duties between the parties, liability issues between three different
worker’s compensation insurance providers, employment status of the claimant, and
other related issues.
The legal issues discussed above are all issues that are in play in this case. These
are issues that the DWC routinely addresses through its administration of the Act. These
are issues that fall squarely within the exclusive jurisdiction of the DWC. This court does
not have subject-matter jurisdiction over these matters until all of the administrative
remedies available through the Act have been exhausted.
In Morales v. Liberty Mut. Sinc. Co.13, the Texas Supreme Court addressed the
issue of the relationship between compensability under the Texas Worker’s
13 241 S.W.3d 514 (Tex. 2007).
16
Compensation Act (“the Act”), employee status, and subscriber status.14 The Court held
that issues of coverage such as the one in this case fall within the rubric of the existence
of a compensable injury which is properly resolved through the Act. Morales was killed
while repairing a roof on a motel. Id. at 515. His wife sought death-benefits under the
act claiming he was injured while in the course and scope of his employment with three
different employers. Id. Two of the employers were insured under separate worker’s
compensation policies, and the third was a nonsubscriber. Id.
The existence of a compensable injury is the threshold requirement for
payment of benefits under the Act. See TEX. LAB.CODE §§ 401.011(5),
406.031(a). And there are various elements that affect whether an injury is
compensable, including the worker's employment status as an employee or
independent contractor at the time of injury, whether the worker was injured
in the course and scope of employment, who controlled the employee's
work when the injury occurred, and whether a particular employer has an
insurance policy in effect. See id. §§ 401.011(12), (18), 401.012(a).
....
A dispute about any of these elements regards “compensability or eligibility
for . . . benefits” and is subject to judicial review under section 410.301.
Morales v. Liberty Mut. Ins. Co., 241 S.W.3d at 519. iWORKS has consistently claimed
that it has a worker’s compensation policy and that Waste Management controlled the
Guillory’s work when his injury occurred. These are issues within the purview of the Act
and over which the DWC has exclusive jurisdiction.
14 The Morales Court addressed these issues in the context of determining which standard of review set
forth in the Act should apply to judicial review of a final decision from a DWC appeals panel. If the issues
being appealed involve “compensability” then the standard of review is the “modified de novo” standard
established by §410.301. Issues that do not address compensability are reviewed under a “substantial-
evidence” standard. Morales, 241 at 516-17. The outcome of this question of compensability also effects
venue and the appropriate scope of judicial review. Id.
17
In In Re Tex. Mut. Ins. Co.15 the court addressed the DWC’s exclusive jurisdiction
in the context of common law breach of contract claims and disputed coverage. The Court
held that the Fodge decision mandated that the claimant’s breach-of-contract claim “is
within the Commission’s exclusive jurisdiction.” Id., 157 S.W.3d at 80. The Court also
held that:
We likewise reject [Claimant’s] assertions that the Commission’s exclusive
jurisdiction over worker’s compensation benefits claims does not extend to
determining whether coverage existed at the time of [Claimant’s] injury. The
legislature has granted the Commission exclusive jurisdiction over claims
for policy benefits. Fodge, 63 S.W.3d at 805. In adjudicating such claims,
the Commission will necessarily have to interpret compensation policies
and determine the period in which coverage existed. Indeed, it appears to
routinely do so. See, e.g., Gonzales v. Cigna Ins. Co. of Tex, 924 S.W.2d
183, 184-87 (Tex.App.—San Antonio 1996, write denied); Houston Gen.
Ins. Co. v. Association Cas. Ins. Co., 972 S.W.2d 634, 636 (Tex.App.—Tyler
1998, no pet.).
Moreover, [Claimant’s] argument would imply that whenever the
Commission, in the exercise of its exclusive jurisdiction, encounters a
coverage issue that can be characterized as going to "policy formation," the
agency must abate its proceedings pending judicial resolution of the
"formation" issue. We doubt that the legislature, in conferring exclusive
jurisdiction upon the Commission to determine compensation benefits
claims, intended such an absurd result that seemingly turns traditional
concepts of exclusive jurisdiction on their head.
Id. at p.
Nor does iWORKS’ delay in reporting Guillory’s injury to its insurance carrier
preclude it from invoking the administrative procedures of the Act. See Hand v. SGS
Control Servs., Inc., 409 S.W.3d 743, 749 (Tex.App.—Houston [1st Dist.] 2013). The court
held that “[the employer] ‘invoked” its workers’ compensation insurance coverage when
it initially obtained the coverage; it was not required to take an specific action to ‘invoke’
15 157 S.W.3d 75 (Tex.App.—Austin 2004, orig. proceeding).
18
that coverage after [Plaintiff] was injured, and it did not forfeit its protections under the
Workers’ Compensation Act when it failed to notify its insurance carrier of Reagan’s injury
in a timely manner.” Id.
V.
Conclusion
This is a workers’ compensation case which should have been filed with the DWC
over two years ago. For the various reasons discussed above, none of the parties were
eager to do so. iWORKS’ has relented and filed a claim with its worker’s compensation
carrier. This will start the administrative process necessary to exhaust the remedies
provided by the DWC. However, until those remedies are fully exhausted this Court lacks
subject-matter jurisdiction. Therefore, this Court must dismiss Plaintiffs’ claims as a
matter of law.
VI.
Prayer
Defendants iWORKS, Trevino, and Gutierrez pray that the Court grant the relief
requested herein and for any and all other relief to which they are entitled in law or equity.
Respectfully submitted,
___/s/_David N. Anderson___________
David N. Anderson
TBN: 00797951
4309 Yoakum
Houston, TX 77006
(713) 521-6563 - Telephone
(866) 524-4294 – Fax
danderson@lodna.net
ATTORNEY FOR DEFENDANTS
IWORKS PERSONNEL, INC.,
LUIS TREVINO, and
HAYDEE GUTIERREZ
19
NOTICE OF HEARING
The foregoing motion will be heard by the Court on Friday, February 20, 2015 at
9:00 a.m.
_/s/_David N. Anderson___________
David N. Anderson
CERTIFICATE OF SERVICE
I certify that on February 13, 2015 all parties were served a copy of the foregoing
via eFILE in accordance with the Texas Rules of Civil Procedure, to whit:
Bradford J. Gilde Nicholas A. Homan
Texas Bar No. 24045941 Texas Bar No. 24083194
bjg@gildelawfirm.com nah@gildelawfirm.com
GILDE LAW FIRM
55 Waugh, Suite 850
Houston, TX 77007
(281) 973-2772 – phone
(281) 973-2771 –facsimile
Attorneys for Plaintiffs
B. Lee Wertz, Jr. Carrie Schadle
Texas Bar No. 00797796 Texas Bar No. 24051618
lee.wertz@harrisonbettis.com carrie.schadle@harrisonbettis.com
HARRISON, BETTIS, STAFF, MCFARLAND & W EEMS, L.L.P.
1415 Louisiana, 37th Floor
Houston, Texas 77002
(713) 843-7900 – phone
(713) 843-7901 – facsimile
Attorneys for Defendant Waste Management, Inc., et al.
/s/ David N. Anderson__________
David N. Anderson
20
Case No. 201261407
MOSE A. GUILLORY AND MARY § IN THE DISTRICT COURT OF
GUILLORY §
§ HARRIS COUNTY, TEXAS
V. §
§
IWORKS PERSONNEL, INC, ET AL. § 113TH JUDICIAL DISTRICT
IWORKS PERSONNEL, INC.’S SUPPLEMENT TO
iWORKS’ PLEA TO THE JURISDICTION
DEFENDANTS, iWORKS PERSONNEL, INC., LUIS TREVINO, and HAYDEE
GUTIERREZ (hereinafter “IWORKS”) file this Supplement to iWORKS’ Plea to the
Jurisdiction. In support thereof it would show this honorable Court the following:
I.
iWORKS files this Supplement to iWORKS’ Plea to the Jurisdiction in order to
present to the Court additional evidence, recently obtained, which supports its Plea to the
Jurisdiction.
A. Exhibit G – Texas Mutual Claim
Exhibit G is Texas Mutual Insurance Company’s acknowledgement of a claim for
Mose Guillory. This shows that there is a pending matter subject to the exclusive
jurisdiction of the Texas Department of Insurance – Division of Workers’ Compensation
(“DWC”). Until this administrative process has run its course and Plaintiff has exhausted
all of his administrative remedies, this Court lacks subject-matter-jurisdiction.
B. Exhibit H – Correspondence from Gilde to the DWC
Exhibit H is correspondence that was produced this week by Plaintiff’s counsel.
This is a letter from Brad Gilde to the DWC dated August 12, 2013. It is styled as a
“Notice, Stay, and Preservation Letter.” Although litigation was ongoing and both
iWORKS and Waste Management were represented by counsel,1 neither Defendant was
copied on this correspondence. Plaintiff attached two separate DWC-041 (“Employee’s
Claim for Compensation for a Work-Related Injury of Occupational Disease”) forms to the
letter. One names iWORKS as Plaintiff’s employer and the other names Waste
Management as his employer. Thus, Plaintiff’s counsel recognized that Plaintiff had a
claim for compensation under two separate worker’s compensation policies and elected
to forego pursuing those claims.
Gilde’s letter to the DWC purports to reserve Plaintiff’s right to seek relief from the
DWC in the event he is unsuccessful in this Court. This approach turns the purpose of
the entire worker’s compensation system on its head. This letter demonstrates that
Plaintiff was well aware of the requirements under the Texas Labor Code yet consciously
chose to attempt to circumvent that process in hopes of a common law verdict. This is
not the public policy of Texas.
This letter to the DWC admits that it “is submitted: (1) as a notice of claim for
compensation . . . (3) as a preservation of right to file and seek a claim for compensation
. . . and (5) pursuant to Tex. Labor Code §409.004.” Ex. G (emphasis in original). The
letter further states that “. . . this letter . . . is not an election or denial of a claim for
coverage.” Id. Plaintiff cannot hedge his bets with the administrative agency while
improperly seeking a judicial remedy in this Court without first exhausting his
administrative remedies. His failure to do so in this matter, despite knowing the
administrative requirements set forth in the Texas Labor Code, deprives this Court of
subject-matter jurisdiction over Plaintiff’s claims.
II.
1 At that time Aric Garza was counsel for iWORKS.
Prayer
Defendants iWORKS, Trevino, and Gutierrez pray that the Court grant the relief
requested in their Plea to the Jurisdiction and for any and all other relief to which they are
entitled in law or equity.
Respectfully submitted,
___/s/_David N. Anderson___________
David N. Anderson
TBN: 00797951
4309 Yoakum
Houston, TX 77006
(713) 521-6563 - Telephone
(866) 524-4294 – Fax
danderson@lodna.net
ATTORNEY FOR DEFENDANTS
IWORKS PERSONNEL, INC.,
LUIS TREVINO, and
HAYDEE GUTIERREZ
CERTIFICATE OF SERVICE
I certify that on February 19, 2015 all parties were served a copy of the foregoing
via eFILE in accordance with the Texas Rules of Civil Procedure as follows:
Bradford J. Gilde Nicholas A. Homan
Texas Bar No. 24045941 Texas Bar No. 24083194
bjg@gildelawfirm.com nah@gildelawfirm.com
GILDE LAW FIRM
55 Waugh, Suite 850
Houston, TX 77007
(281) 973-2772 – phone
(281) 973-2771 –facsimile
Attorneys for Plaintiffs
B. Lee Wertz, Jr. Carrie Schadle
Texas Bar No. 00797796 Texas Bar No. 24051618
lee.wertz@harrisonbettis.com carrie.schadle@harrisonbettis.com
HARRISON, BETTIS, STAFF, MCFARLAND & W EEMS, L.L.P.
1415 Louisiana, 37th Floor
Houston, Texas 77002
(713) 843-7900 – phone
(713) 843-7901 – facsimile
Attorneys for Defendant Waste Management, Inc., et al.
/s/ David N. Anderson__________
David N. Anderson
CAUSE
NO.
2012-­‐61407
MOSE
A.
GUILLORY
and
MARY
GUILLORY,
§
IN
THE
DISTRICT
COURT
Plaintiffs
§
§
§
§
v.
§
OF
HARRIS
COUNTY,
TEXAS
§
§
IWORKS
PERSONNEL,
INC.;
et
al.
§
Defendants
§
113th
JUDICIAL
DISTRICT
PLAINTIFFS’
RESPONSE
TO
IWORKS
DEFENDANTS’
PLEA
TO
THE
JURISDICTION
COME
NOW,
MOSE
A.
GUILLORY
and
MARY
GUILLORY
and
file
this
PLAINTIFFS’
RESPONSE
TO
IWORKS
DEFENDANTS’
PLEA
TO
THE
JURISDICTION
(hereinafter
“Response”)
asking
the
Court
to
DENY
iWorks
Defendants’
Plea
to
the
Jurisdiction,
and
in
support
of
same,
Plaintiffs
respectfully
show
this
Court
as
follows:
“[A]
negligence
claim
is
outside
the
[Workers’
Compensation]
Commission’s
exclusive
jurisdiction.
The
Commission’s
exclusive
jurisdiction
extends
to
claims
for
benefits
under
workers’
compensation
insurance
policies.”
In
re
Texas
Mut.
Ins.
Co.,
157
S.W.3d
75,
81
(Tex.
App.—Austin
2004,
pet.
denied)
(orig.
proceeding)
(citing
Tex.
Lab.
Code
Ann.
§
408.001(a)).
The
Commission’s
exclusive
jurisdiction,
however,
does
not
extend
to
all
cases
that
touch
on
workers’
compensation
issues.
The
district
courts
decide
disputes
about
whether
the
Act’s
exclusive
remedy
provision
applies
as
a
defense
to
an
injured
worker's
personal
injury
suit.
AMS
Constr.
Co.
v.
K.H.K.
Scaffolding
Hous.,
Inc.,
357
S.W.3d
30,
38-­‐39
(Tex.
App.—Houston
[1st
Dist.]
2011,
pet.
denied)
(emphasis
added)
(citing
Garza
v.
Excel
Logistics,
Inc.,
161
S.W.3d
473,
481
(Tex.
2005)
(holding
that
company
did
not
establish
that
it
was
covered
by
workers’
compensation
insurance
for
temporary
employee’s
injury
because,
even
if
temporary
worker
agency
was
contractually
obligated
to
PLAINTIFFS’
RESPONSE
TO
IWORKS
DEFENDANTS’
PLEA
TO
THE
JURISDICTION
1
provide
workers’
compensation
insurance
that
named
company
as
insured,
company
produced
no
evidence
of
such
policy);
Wingfoot
Enters.
v.
Alvarado,
111
S.W.3d
134,
149
(Tex.
2003)).
I. INTRODUCTORY
FACTS
1. iWorks
Defendants’
PTJ
begins
by
claiming
that
“the
great
bulk
of
legal
efforts
expended
in
this
case
are
the
direct
result
of
Plaintiffs’
numerous
and
continued
attempts
to
circumvent
the
Texas
Labor
Code
in
the
face
of
well
settled
law
and
clear
public
policy
dictating
otherwise.”
This
is
but
one
of
many
brazenly
false
statements
advanced
by
iWorks
Defendants
in
their
meritless
Plea
to
the
Jurisdiction.
2. Never
mind
the
fact
that
iWorks
Defendants
have
claimed
to
be
workers’
compensation
subscribers
for
2
½
years
but
they
have
NEVER
produced
a
valid
workers’
compensation
policy
or
produced
proof
of
a
valid
workers’
compensation
policy.
In
fact,
iWorks
Defendants
claimed
to
be
workers’
compensation
subscribers
for
2
½
years
before
taking
any
action
to
initiate
a
workers’
compensation
claim
for
Mose
Guillory
on
an
invalid,
terminated
policy.
3. Nonetheless,
Plaintiffs
can
only
hope
that
this
Plea
to
the
Jurisdiction
is
truly
iWorks
Defendants’
last
ditch
effort
in
a
desperate
pattern
of
dilatory
tactics
designed
to
forestall
the
inevitable
trial
in
this
case—to
wit:
4. On
August
21,
2014,
the
Court
signed
a
“Second
Partial
Summary
Judgment”
Order
largely
denying
iWorks
Defendants’
summary
judgment
motions.
The
result
of
the
summary
judgment
motion
practice
revealed
that
iWorks
Defendants
are
Non-­‐Subscribers.
5. Immediately
following
the
Court’s
denial
of
iWorks
Defendants’
summary
judgment
motions,
iWorks
Defendants
took
a
number
of
actions
–
the
effect
of
which
delayed
or
were
designed
to
delay
the
impending
trial.
6. DILATORY
ACTION
#1:
On
September
2,
2014,
iWorks
Defendants
filed
a
Motion
for
Continuance
seeking
a
90-­‐day
trial
continuance
based
on
the
health
of
counsel.
On,
September
29,
2014,
the
Court
signed
an
order
granting
iWorks’
Motion
for
Continuance
and
gave
Counsel
for
iWorks
Defendants
a
168-­‐day
trial
continuance.
7. DILATORY
ACTION
#2:
On
November
3,
2014,
forty-­‐two
(42)
days
after
Counsel
for
iWorks
PLAINTIFFS’
RESPONSE
TO
IWORKS
DEFENDANTS’
PLEA
TO
THE
JURISDICTION
2
Defendants’
scheduled
back
surgery,
iWorks
Defendants’
filed
a
Motion
to
Reconsider
the
NEMSJs
and
TMSJs
ruled
on
in
this
Court’s
2nd
Partial
Summary
Judgment
Order.
8. On
December
4,
2014,
this
Court
signed
an
Order
denying
iWorks
Defendants’
Motion
to
Reconsider.
9. DILATORY
ACTION
#3:
On
December
8,
2014,
iWorks
Defendants
filed
their
Third
Amended
Answer
and
Cross-­‐Claims
against
WM
Defendants.
iWorks
Defendants’
cross-­‐claims
contain
Declaratory
Judgment
and
Breach
of
Contract
claims
against
WM
Defendants.
10. This
lawsuit
was
filed
on
October
17,
2012,
nearly
2
½
years
ago.
Yet,
iWorks
Defendants
participated
fully
in
pre-­‐trial
activities
for
over
2
years
before
they
decided
to
assert
non-­‐compulsory
cross-­‐claims
only
3
months
before
trial.
11. DILATORY
ACTION
#4:
On
December
12,
2014,
the
Court
held
an
oral
hearing
on
WM
Defendants’
Motion
to
Sever.
At
that
hearing,
Counsel
for
iWorks
orally
represented
that
he
intended
to
file
a
Motion
to
Abate
trial
until
any
alleged
workers’
compensation
claim
is
resolved.
12. On
January
28,
2015,
Waste
Management,
Inc.
(“WM”)
filed
a
Traditional
Motion
for
Summary
Judgment
against
iWorks
Personnel,
Inc.
and
its
newly
asserted
cross-­‐claims.
WM
Defendants’
TMSJ
is
set
for
hearing
on
March
27,
2015.
13. Plaintiffs
and
WM
Defendants
seem
to
be
in
some
agreement
that
Plaintiffs’
claims
against
iWorks
Defendants
ought
to
be
tried
separately
from
iWorks
Defendants’
cross-­‐claims
against
WM
Defendants.
14. As
such,
on
February
9,
2015,
Plaintiffs
filed
their
Partially
Unopposed
Motion
for
Separate
Trials
asking
the
Court
to
separate
the
trial
of
Plaintiffs’
claims
and
iWorks
Defendants’
cross-­‐claims,
thereby
avoiding
any
further
delay
of
Plaintiffs’
day
in
court.
Plaintiffs
set
their
Motion
for
Separate
Trials
for
hearing
on
February
20,
2015.
15. DILATORY
ACTION
#5:
Plaintiffs
attempted
to
confer
with
Counsel
Defendants
regarding
Plaintiffs’
Motion
for
Separate
Trials.
WM
Defendants
indicated
they
were
“unopposed.”
Plaintiffs
received
no
response
from
iWorks
Defendants.
PLAINTIFFS’
RESPONSE
TO
IWORKS
DEFENDANTS’
PLEA
TO
THE
JURISDICTION
3
16. DILATORY
ACTION
#6:
On
February
7,
2015,
iWorks
Defendants
served
a
letter
and
an
unsigned,
undated,
DWC
Form-­‐001
(Notice
of
Injury).
This
was
done
in
an
attempt
to
create
a
doomed
workers’
compensation
claim
on
an
insurance
policy
that
had
been
cancelled
at
time
of
the
incident
in
question.
17. DILATORY
ACTION
#7:
On
February
13,
2015,
iWorks
Defendants
filed
their
improper
Plea
to
the
Jurisdiction
asking
this
Court
to
hold
that
a
non-­‐subscribing
employer
may
invoke
Division
of
Workers’
Compensation
(hereinafter
“DWC”)
jurisdiction
and
gain
dismissal
simply
by
filing
a
claim
on
a
workers’
compensation
policy
that
was
ineffective
and
invalid
on
the
injury
date.
18. As
is
clear
from
the
pattern
of
actions
summarized
above,
iWorks
Defendants’
PTJ
is
but
their
latest
attempt
to
have
this
Court
delay
Plaintiffs’
day
in
Court
and
reward
iWorks
for
being
a
non-­‐
subscribing
company
that,
quoting
CEO
Luis
Trevino,
“JUST
BLEW
IT”
and
“DIDN’T
DO
ITS
JOB.”
See
Deposition
of
Luis
Trevino.
II. FACTS
RELEVANT
TO
PLAINTIFFS’
RESPONSE
19. On
or
about
July
9,
2012,
Plaintiff
was
hired
by
Defendant
IWORKS
PERSONNEL,
INC.
(“iWorks”
or
“IWORKS”)
and
was
assigned
to
work
for
the
WM
Defendants
at
a
“Material
Recovery
Facility”
located
at
4939
Gasmer
Drive,
Houston
Texas
77035
(hereinafter
“Facility”
or
“Gasmer
MRF”).
20. On
August
5,
2012,
after
working
at
the
Gasmer
MRF
for
approximately
one
month,
Plaintiff
Mose
Guillory
was
catastrophically
injured
while
operating
a
Harris
Centurion
Baler
in
the
performance
of
his
job
for
Defendants.
21. Prior
to
August
5,
2012,
Plaintiff
had
not
received
any
training,
instruction,
manuals
or
guidelines
on
how
to
properly
and
safely
operate
the
baler.
Moreover,
as
evidenced
by
the
OSHA
Citations
issued
to
WM
Defendants,
Plaintiff
Mose
Guillory
was
never
provided
any
training
on
proper
Lock
Out/Tag
Out
procedures.
22. On
page
4
of
their
PTJ,
iWorks
Defendants
readily
admit:
“IWORKS
provides
no
site
specific
training
to
the
temporary
workers’
that
it
provides
to
its
clients.”
See
iWorks
PTJ
at
p.
4.
However,
the
“Master
Agreement”
between
iWorks
Defendants
and
WM
Defendants
provided
that
iWorks
was
PLAINTIFFS’
RESPONSE
TO
IWORKS
DEFENDANTS’
PLEA
TO
THE
JURISDICTION
4
“obligated
to
ensure
that
Personnel
supplied
to
Waste
Management
are
fully
qualified
and
trained
for
the
jobs
they
are
being
supplied
to
perform
and
that
they
have
been
given
safety
training
that
meets
or
exceeds
the
training
Waste
Management
provides
its
employees
for
the
same
or
similar
jobs.”
See
EXHIBIT
C
at
p.
2.
23. Therefore,
on
October
17,
2012,
Plaintiffs
filed
their
Original
Petition
against
Defendant
iWorks
and
WM
Defendants.
24. In
its
PTJ,
iWorks
Defendants
claim
that
“Plaintiff’s
counsel
has
had
two
separate
worker’s
compensation
policies
which
would
provide
[Mose
Guillory]
with
worker’s
compensation
coverage.”
See
iWorks
PTJ
at
p.
1.
THIS
IS
FALSE.
25. First,
the
“policy”
iWorks
Defendants
are
referring
to,
and
which
they
attach
as
Exhibit
A
to
their
PTJ,
is
not
a
policy
at
all.
Exhibit
A
to
iWorks
Defendants’
PTJ
is
an
“Information
Page”
and
it
references
an
insurance
policy
with
Texas
Mutual
belonging
to
“Preferred
Staffing
Company,
LLC.”
See
iWorks
PTJ,
Exhibit
A.
In
2
½
years
of
litigation,
iWorks
Defendants
have
NEVER
produced
a
workers’
compensation
policy
allegedly
covering
iWorks
Personnel,
Inc.
26. The
Texas
Mutual
information
page
references
policy
number
“STA-­‐0001204473
20110904.”
See
iWorks
PTJ,
Exhibit
A.
Counsel
for
iWorks
Defendants
attempted
to
initiate
a
claim
on
this
policy
on
our
about
February
5,
2015,
as
seen
in
Exhibit
C
to
iWorks
PTJ.
27. However,
on
October
31,
2013,
Plaintiffs
executed
a
Deposition
by
Written
Questions
on
2
entities:
Texas
Mutual
Insurance
Co.
and
Lette
Insurance
Agency.
Texas
Mutual
is
the
carrier
on
iWorks
Defendants’
purported
insurance
policy
and
Lette
Insurance
is
the
agency
through
which
iWorks
Defendants
attempted
to
procure
same.
28. Regarding
iWorks
Defendants’
policy
number
STA-­‐0001204473
20110904,
Texas
Mutual
testified
as
follows:
PLAINTIFFS’
RESPONSE
TO
IWORKS
DEFENDANTS’
PLEA
TO
THE
JURISDICTION
5
See
EXHIBIT
A
at
p.
6.
29. Regarding
iWorks
Defendants
ineffective
policy,
Texas
Mutual
further
testified
as
follows:
See
EXHIBIT
A
at
p.
10.
30. Finally,
Texas
Mutual
confirmed
that
iWorks
Defendants
were
non-­‐subscribers
on
the
date
of
the
incident
in
question—to
wit:
PLAINTIFFS’
RESPONSE
TO
IWORKS
DEFENDANTS’
PLEA
TO
THE
JURISDICTION
6
See
EXHIBIT
A
at
pp.
10-­‐11.
31. The
foregoing
testimony
was
sworn
and
is
admissible
under
the
Texas
Rules
of
Evidence—to
wit:
See
EXHIBIT
A
at
p.
16.
32. In
relevant
part,
Texas
Mutual’s
“NOTICE
OF
CANCELLATION”
of
iWorks
Defendants’
purported
workers’
compensation
insurance
policy
reads
as
follows:
PLAINTIFFS’
RESPONSE
TO
IWORKS
DEFENDANTS’
PLEA
TO
THE
JURISDICTION
7
EXHIBIT
A,
Bates
No.
TXM00318
(p.
340
of
418).
33. When
presented
with
this
information
at
a
summary
judgment
hearing,
Your
Honor
inquired
as
to
whether
there
was
any
evidence
proving
that
iWorks
Defendants
had
cured
their
violations
and
renewed
their
cancelled
policy
prior
to
Mose
Guillory’s
incident
on
August
5,
2012.
The
answer
is
“NO.”
A
deficiency
letter
dated
August
24,
2012
proves
that
iWorks
Defendant
had
not
revived
their
cancelled
policy
and
were
still
non-­‐subscribers
on
August
5,
2012.
See
EXHIBIT
A,
Bates
No.
TXM00355–360
(p.
377-­‐418).
34. In
their
PTJ,
iWorks
Defendants
claim
“[t]he
only
plausible
explanation
for
Guillory’s
failure
to
even
try
to
claim
his
benefits
under
the
Texas
Workers’
Compensation
Act
is
that
he
and
his
counsel
decided
early
in
the
course
of
this
litigation
to
try
and
circumvent
the
worker’s
compensation
system
in
an
attempt
to
recover
common
law
damages.”
iWorks
PTJ
at
p.
12.
35. What
truly
happened
is
the
following:
Counsel
for
Plaintiffs
attempted
to
confirm
workers’
compensation
coverage
for
iWorks
or
Preferred
Staffing
through
the
Texas
Department
of
Insurance
website—there
was
no
coverage.
Counsel
for
Plaintiffs
then
called
the
Texas
Department
of
Insurance
to
confirm
coverage
for
iWorks
or
Preferred
Staffing—there
was
no
coverage.
PLAINTIFFS’
RESPONSE
TO
IWORKS
DEFENDANTS’
PLEA
TO
THE
JURISDICTION
8
36. Plaintiffs
then
filed
this
lawsuit
and
served
Requests
for
Disclosures
in
October
of
2012.
However,
Counsel
for
iWorks
did
not
produce
the
cancelled
policy
information
page
until
Luis
Trevino’s
deposition
in
August
of
2013.
Thereafter,
one
brief
phone
call
to
the
DWC
casted
serious
doubt
as
to
the
effectiveness
of
the
policy
underlying
iWorks’s
policy
information
page.
At
last,
the
foregoing
deposition
testimony
from
Texas
Mutual
and
Lette
Insurance
put
the
final
nail
in
the
coffin
regarding
iWorks
Defendants’
status
as
non-­‐subscribers.
37. iWorks
Defendants
have
been
in
possession
of
the
foregoing
testimony
and
documents
since
October
of
2013.
The
Texas
Mutual
and
Lette
Insurance’s
responses
to
DWQ
clearly
disprove
iWorks
Defendants’
untenable
position
that
they
are
workers’
compensation
“subscribers.”
iWorks
Defendants
only
attempt
to
disprove
the
foregoing
comes
in
the
form
of
Luis
Trevino’s
Affidavit,
attached
as
Exhibit
F
to
iWorks
PTJ.
38. In
his
affidavit,
Luis
Trevino
claims
that
Texas
Mutual’s
cancellation
of
coverage
was
incorrect
because
he
never
received
notice.
The
Notice
of
Cancellation
above
shows
that
it
was
sent
via
certified
mail
to
iWorks
Personnel,
Inc.’s
registered
address.
See
EXHIBIT
A,
Bates
No.
TXM00318
(p.
340
of
418).
Lette
Insurance’s
responses
to
DWQ
prove
that
they
were
in
receipt
of
the
required
Notices
of
Cancellation
as
iWorks
Defendants’
insurance
agent.
See
EXHIBIT
B,
Bates
No.
000008
(p.
48
of
138).
Moreover,
documents
produced
by
Lette
Insurance
in
response
to
DWQ
prove
that
iWorks
President
Haydee
Gutierrez
was
in
direct
contact
with
Texas
Mutual
during
this
cancellation
period.
See
EXHIBIT
B,
Bates
No.
000015
(p.
55
of
138).
39. This
all
leads
to
one,
indisputable
conclusion:
IWORKS
DEFENDANTS
ARE
NON-­‐SUBSCRIBERS
AS
TO
MOSE
GUILLORY.
40. Plaintiffs
Mose
and
Mary
Guillory
have
endured
indescribable
suffering
and
despair
to
reach
this
point
in
their
case.
The
road
has
been
hard
fought,
and
their
day
in
court
is
well
earned.
iWorks
Defendants
now
seek
to
rob
the
Guillory’s
of
their
Constitutional
Right
to
try
their
case
to
a
jury
by
disingenuously
filing
a
claim
on
a
dead
workers’
compensation
policy.
PLAINTIFFS’
RESPONSE
TO
IWORKS
DEFENDANTS’
PLEA
TO
THE
JURISDICTION
9
41. Texas
Mutual
confirms
that
iWorks
Defendants
were
non-­‐subscribers
as
to
Mose
Guillory,
and
there
will
never
be
workers’
compensation
benefits
paid
under
policy
number
STA-­‐0001204473
20110904.
What’s
worse
is
that
iWorks
Defendants
and
their
Counsel
know
the
policy
at
issue
was
ineffective
on
the
date
of
the
incident
in
question
and
they
know
that
the
claim
would
be
denied
even
before
it
was
filed.
42. Because
iWorks
Defendants’
PTJ
is
untimely,
improper,
and
meritless,
Plaintiffs
ask
this
Court
to
DENY
iWorks
Defendants’
PTJ.
III. PLEA
TO
THE
JURISDICTION
STANDARD
43. Plaintiffs
incorporate
all
preceding
paragraphs
by
reference
as
though
fully
set
forth
herein.
44. When
a
defendant
asks
the
court
to
dismiss
for
lack
of
subject-­‐matter
jurisdiction,
the
court
must
overrule
the
motion
unless
the
pleadings
and
the
parties’
evidence
clearly
demonstrate
that
the
court
lacks
jurisdiction.
See
Bland
Indep.
Sch.
Dist.
v.
Blue,
34
S.W.3d
547,
555
(Tex.
2000);
see,
e.g.,
State
v.
Sledge,
36
S.W.3d
152,
155
(Tex.
App.—Houston
[1st
Dist.]
2000,
pet.
denied)
(trial
court
conducted
hearing
and
received
oral
testimony,
affidavits,
exhibits,
and
stipulations).
45. In
ruling
on
the
motion,
the
court
is
required
to
construe
the
pleadings
in
the
plaintiff’s
favor.
See
Texas
Ass’n
of
Bus.
v.
Texas
Air
Control
Bd.,
852
S.W.2d
440,
446
(Tex.
1993).
The
plea
to
the
jurisdiction
standard
mirrors
the
summary-­‐judgment
procedure
under
TRCP
166a(c).
Mission
Consol.
ISD
v.
Garcia,
372
S.W.3d
629,
635
(Tex.
2012).
46. DEFENDANTS’
BURDEN.
A
defendant
is
entitled
to
summary
judgment
ONLY
when
he/she/it,
as
a
matter
of
law,
disproves
one
or
more
of
the
essential
elements
of
each
of
the
plaintiff's
causes
of
action
or
pleads
and
conclusively
establishes
each
essential
element
of
an
affirmative
defense,
thereby
rebutting
the
plaintiff’s
cause
of
action.
Lear
Siegler,
Inc.
v.
Perez,
819
S.W.2d
470,
471
(Tex.
1991)
(emphasis
added);
Peeler
v.
Hughes
&
Luce,
868
S.W.2d
823,
827
(Tex.
App.—Dallas
1993),
aff'd,
909
S.W.2d
494
(Tex.
1995);
International
Union
UAW
Local
119
v.
Johnson
Controls,
Inc.,
813
S.W.2d
558,
563
(Tex.
App.—Dallas
1991,
writ
denied);
Traylor
v.
Unitedbank
Orange,
675
S.W.2d
802,
804
(Tex.
App.—
Beaumont
1984,
writ
ref'd
n.r.e.).
PLAINTIFFS’
RESPONSE
TO
IWORKS
DEFENDANTS’
PLEA
TO
THE
JURISDICTION
10
47. DEFENDANTS’
BURDEN
–
CONT.
A
matter
is
conclusively
established
if
ordinary
minds
cannot
differ
as
to
the
conclusion
to
be
drawn
from
the
summary
judgment
proof.
Triton
Oil
&
Gas
Corp.
v.
Marine
Contractors
&
Supply,
Inc.,
644
S.W.2d
443,
446
(Tex.
1982)
(emphasis
added).
48. DEFENDANTS’
BURDEN
–
CONT.
When
evaluating
a
Traditional
Motion
for
Summary
Judgment
based
on
summary
judgment
evidence,
the
trial
court
MUST
do
the
following:
a. Assume
ALL
of
the
nonmovant’s
proof
is
true.
Limestone
Prods.
Distrib.,
Inc.
v.
McNamara,
71
S.W.3d
308,
311
(Tex.
2002);
Shah
v.
Moss,
67
S.W.3d
836,
842
(Tex.
2001);
M.D.
Anderson
Hosp.
&
Tumor
Inst.
v.
Willrich,
28
S.W.3d
22,
23
(Tex.
2000);
Nixon
v.
Mr.
Prop.
Mgmt.,
690
S.W.2d
546,
548-­‐49
(Tex.
1985)
(emphasis
added).
b. Make
EVERY
reasonable
inference
in
favor
of
the
nonmovant.
Provident
Life
&
Acc.
Ins.
Co.
v.
Knott,
128
S.W.3d
211,
215
(Tex.
2003);
M.D.
Anderson
Hosp.
&
Tumor
Inst.
v.
Willrich,
28
S.W.3d
22,
23
(Tex.
2000);
Science
Spectrum,
Inc.
v.
Martinez,
941
S.W.2d
910,
911
(Tex.
1997);
Nixon
v.
Mr.
Prop.
Mgmt.,
690
S.W.2d
546,
549
(Tex.
1985)
(emphasis
added).
c. Resolve
ALL
doubts
about
the
existence
of
a
genuine
issue
of
material
fact
against
the
movant.
M.D.
Anderson
Hosp.
&
Tumor
Inst.
v.
Willrich,
28
S.W.3d
22,
23
(Tex.
2000);
Johnson
Cty.
Sheriff’s
Posse,
Inc.
v.
Endsley,
926
S.W.2d
284,
285
(Tex.
1996);
Nixon
v.
Mr.
Prop.
Mgmt.,
690
S.W.2d
546,
548-­‐49
(Tex.
1985).
See
also
Rhône-­‐Poulenc,
Inc.
v.
Steel,
997
S.W.2d
217,
223
(Tex.
1999);
Collins
v.
County
of
El
Paso,
954
S.W.2d
137,
145
(Tex.
App.—El
Paso
1997,
pet.
denied).
49. DEFENDANTS’
BURDEN
–
CONT.
Regarding
the
“Exclusive
Remedy”
defense,
the
defendant
must
(1)
conclusively
prove
that
it
was
the
plaintiff’s
employer
within
the
meaning
of
the
TWCA,
(2)
conclusively
prove
that
it
subscribed
to
workers’
compensation
insurance
as
to
the
injured
employee.
Western
Steel
Co.
v.
Altenburg,
206
S.W.3d
121,
123
(Tex.
2006);
see
also
Port
Elevator-­‐Brownsville
v.
Casados,
358
S.W.3d
238
(Tex.
2012).
50. PLAINTIFFS’
BURDEN.
When
the
movant
does
not
meet
its
burden
of
proof,
the
burden
does
not
shift
to
the
nonmovant.
M.D.
Anderson
Hosp.
&
Tumor
Inst.
v.
Willrich,
28
S.W.3d
22,
23
(Tex.
2000);
City
of
Houston
v.
Clear
Creek
Basin
Auth.,
589
S.W.2d
671,
678
n.5
(Tex.
1979).
A
nonmovant
in
a
traditional
summary-­‐judgment
proceeding
is
not
required
to
produce
summary-­‐judgment
evidence
until
after
the
movant
establishes
it
is
entitled
to
summary
judgment
as
a
matter
of
law.
Casso
v.
Brand,
776
S.W.2d
551,
556
(Tex.
1989)
(emphasis
added).
After
the
movant
has
established
conclusively
as
a
PLAINTIFFS’
RESPONSE
TO
IWORKS
DEFENDANTS’
PLEA
TO
THE
JURISDICTION
11
matter
of
law
that
movant
is
entitled
to
summary
judgment,
only
then
shall
a
nonmovant
be
responsible
for
producing
summary
judgment
evidence
to
raise
a
fact
issue
in
a
response.
51. PLAINTIFFS’
RESPONSE.
Once
the
movant
establishes
that
he
is
entitled
to
summary
judgment,
the
burden
shifts
to
the
non-­‐movant
to
show
why
summary
judgment
should
be
avoided
in
the
non-­‐
movant’s
response.
Casso
v.
Brand,
776
S.W.2d
551,
556
(Tex.
1989).
The
response
may
be
filed
by
mailing
it
on
the
day
it
is
due,
and
it
is
timely
filed
even
if
it
is
reaches
the
court
less
than
seven
days
before
the
hearing,
as
long
as
it
is
received
by
the
clerk
no
more
than
ten
days
after
the
due
date.
TRCP
5,
21a;
Geiselman
v.
Cramer
Fin.
Grp.,
965
S.W.2d
532,
535
(Tex.
App.—Houston
[14th
Dist.]
1997,
no
writ);
Clendennen
v.
Williams,
898
S.W.2d
257,
259
(Tex.
App.—Texarkana
1995,
no
writ).
52. In
TRCP
21a,
the
three-­‐day
rule
does
not
require
the
non-­‐movant
to
mail
the
response
ten
days
before
the
hearing.
Holmes
v.
Ottawa
Truck,
Inc.,
960
S.W.2d
866,
869
(Tex.
App.—El
Paso
1997,
pet.
denied).
What’s
more,
the
trial
court
must
render
a
summary
judgment
on
the
pleadings
on
file
at
the
time
of
the
hearing.
TRCP
166a(c);
Cluett
v.
Medical
Prot.
Co.,
829
S.W.2d
822,
826-­‐26
(Tex.
App.—Dallas
1992,
writ
denied)
(holding
that
a
party
may
file
an
amended
pleading
after
it
files
its
motion
or
response).
53. If
the
facts
are
disputed,
the
court
cannot
grant
the
plea
to
jurisdiction,
and
the
issue
must
be
resolved
by
the
fact-­‐finder
at
trial.
Mission
Consol.,
372
S.W.3d
at
635;
University
of
Tex.
v.
Hayes,
327
S.W.3d
113,
116
(Tex.
2010).
54. EVIDENCE.
The
trial
court
may
consider
evidence
in
ruling
on
a
plea
to
the
jurisdiction
and
must
consider
evidence
when
necessary
to
resolve
the
jurisdictional
issue
raised.
Bland
ISD
v.
Blue,
34
S.W.3d
547,
555
(Tex.
2000).
When
jurisdiction
involves
the
merits
of
the
case,
the
trial
court
must
review
the
evidence
to
determine
whether
there
is
a
fact
issue.
Texas
Dept.
of
Parks
&
Wildlife
v.
Miranda,
133
S.W.3d
217,
227
(Tex.
2004).
IV. PLEA
TO
THE
JURISDICTION
–
EVIDENCE
ATTACHED
• EXHIBIT
A:
DWQ
Responses
from
Texas
Mutual
Insurance
Company
• EXHIBIT
B:
DWQ
Responses
from
Lette
Insurance
Agency
PLAINTIFFS’
RESPONSE
TO
IWORKS
DEFENDANTS’
PLEA
TO
THE
JURISDICTION
12
• EXHIBIT
C:
Pages
from
WM
and
iWorks
“Master
Agreement”
(WMRA
000022–23)
V. ARGUMENT
&
AUTHORITIES
55. Plaintiffs
incorporate
all
preceding
paragraphs
by
reference
as
though
fully
set
forth
herein.
56. iWorks
Defendants’
PTJ
is
meritless
and
should
be
denied
for
a
at
least
three
reasons.
The
bolded,
centered
case
quotations
above
are
enough
for
this
Court
to
summarily
deny
iWork
Defendants’
baseless
Plea
to
the
Jurisdiction.
However,
Plaintiffs
provide
additional
reasons
and
support
for
this
Court’s
denial
of
iWorks
Defendants’
PTJ,
as
specified
below.
57. First,
the
Court
should
deny
iWorks
Defendants’
PTJ
because
the
DWC
does
not
have
exclusive
jurisdiction
over
an
injured
employee’s
suit
for
common-­‐law
damages.
iWorks
Defendants’
entire
PTJ
is
based
on
one
premise—that
the
Division
of
Workers’
Compensation
has
exclusive
jurisdiction
over
Plaintiffs’
claims
simply
because
iWorks
Defendants
filed
a
notice
of
injury
against
a
workers’
compensation
policy
that
was
invalid,
ineffective,
and
terminated
on
the
date
of
the
injury.
However,
as
explained
below,
this
argument
is
unavailing
and
this
Court
should
deny
iWorks
Defendants’
PTJ.
58. Second,
the
Court
should
deny
iWorks
Defendants’
PTJ
because
iWorks
Defendants
have
failed
to
conclusively
prove
that
they
were
workers’
compensation
subscribers
at
the
time
of
the
incident
in
question.
iWorks
Defendants
cannot
invoke
the
jurisdiction
of
the
DWC
without
proving
that
they
have
some,
effective
workers’
compensation
insurance
coverage.
This
Court
should
deny
iWorks
Defendants’
PTJ
because
it
seeks
dismissal
so
that
the
DWC
can
determine
whether
there
are
benefits
under
a
policy
that
was
invalid,
ineffective,
and
terminated
long
before
the
incident
in
question.
59. Third,
in
the
alternative,
this
Court
should
deny
iWorks
Defendants’
PTJ
because
Plaintiffs’
claims
fall
under
the
exceptions
to
exhaustion
of
administrative
remedies.
a. THE
COURT
SHOULD
DENY
IWORKS
DEFENDANTS’
PTJ
BECAUSE
THE
DWC
DOES
NOT
HAVE
EXCLUSIVE
JURISDICTION
OVER
AN
INJURED
EMPLOYEE’S
SUIT
FOR
COMMON-­‐LAW
DAMAGES
AGAINST
HIS
NON-­‐SUBSCRIBING
EMPLOYER.
60. DISTRICT
COURTS
HAVE
GENERAL
JURISDICTION.
Trial
courts
are
courts
of
general
jurisdiction.
Dubai
Petroleum
Co.
v.
Kazi,
12
S.W.3d
71,
75
(Tex.
2000).
Article
V,
Section
8
of
the
Texas
Constitution
provides
that
a
district
court
has
jurisdiction
over
“all
actions,
proceedings,
and
remedies,
PLAINTIFFS’
RESPONSE
TO
IWORKS
DEFENDANTS’
PLEA
TO
THE
JURISDICTION
13
except
in
cases
where
exclusive,
appellate,
or
original
jurisdiction
may
be
conferred
by
this
Constitution
or
other
law
on
some
other
court,
tribunal,
or
administrative
body.”
Tex.
Const.
art
V,
§
8.
61. Absent
a
contrary
showing,
courts
of
general
jurisdiction
(i.e.
Trial
Courts)
are
presumed
to
have
subject
matter
jurisdiction.
AMS
Constr.
Co.
v.
K.H.K.
Scaffolding
Hous.,
Inc.,
357
S.W.3d
30,
37
(Tex.
App.—
Houston
[1st
Dist.]
2011,
pet.
denied)
(citing
Dubai
Petroleum
Co.,
12
S.W.3d
at
75).
There
is
no
similar
presumption
that
administrative
agencies
are
authorized
to
resolve
disputes.
Subaru
of
Am.,
84
S.W.3d
at
220.
62. DWC
EXCLUSIVE
JURISDICTION.
Whether
an
agency
has
exclusive
jurisdiction
depends
upon
statutory
interpretation,
and
is
a
question
of
law
to
be
reviewed
de
novo.
Subaru
of
Am.,
Inc.
v.
David
McDavid
Nissan,
Inc.,
84
S.W.3d
212,
222
(Tex.
2002).
63. Multiple
Texas
courts
have
examined
the
DWC’s
exclusive
jurisdiction
and
have
universally
held
that
it
extends
only
to
claims
for
benefits
under
workers’
compensation
insurance
policies.
See
In
re
Texas
Mut.
Ins.
Co.,
157
S.W.3d
75,
78
(Tex.
App.—Austin
2004,
pet.
denied);
(DWC
does
not
have
exclusive
jurisdiction
over
employee’s
negligence
claim);
Nat’l
Am.
Ins.
Co.
v.
Tex.
Prop.
&
Cas.
Ins.
Guar.
Ass’n
for
Paula
Ins.
Co.,
2013
Tex.
App.
LEXIS
10865,
15
(Tex.
App.—Austin
2013,
no
pet.)
(DWC’s
exclusive
jurisdiction
does
not
extend
to
the
right
to
reimbursement
for
a
claim
paid
by
a
carrier.);
see
also
AMS
Constr.
Co.,
357
S.W.3d
at
39.
The
Commission’s
exclusive
jurisdiction
.
.
.
does
not
extend
to
all
cases
that
touch
on
workers’
compensation
issues.
The
district
courts
decide
disputes
about
whether
the
Act’s
exclusive
remedy
provision
applies
as
a
defense
to
an
injured
worker's
personal
injury
suit.”
AMS
Constr.
Co.
v.
K.H.K.
Scaffolding
Hous.,
Inc.,
357
S.W.3d
at
38-­‐39.
64. As
such,
the
only
civil
claims
the
DWC
has
jurisdiction
over
are
those
involving
claims
for
wrongful
deprivation
of
workers’
compensation
benefits.
AMS
Constr.
Co.
v.
K.H.K.
Scaffolding
Hous.,
Inc.,
357
S.W.3d
at
38;
(citing
Am.
Motorists
Ins.
Co.
v.
Fodge,
63
S.W.3d
at
804
(holding
that
a
claim
for
wrongful
deprivation
of
workers’
compensation
benefits
brought
by
an
injured
worker
against
an
insurance
carrier
fall
within
the
Commission’s
exclusive
jurisdiction.);
In
re
Liberty
Mut.
Fire
Ins.
Co.,
295
S.W.3d
327,
328
PLAINTIFFS’
RESPONSE
TO
IWORKS
DEFENDANTS’
PLEA
TO
THE
JURISDICTION
14
(Tex.
2009)
(holding
that
trial
court
did
not
have
jurisdiction
to
adjudicate
injured
worker’s
bad-­‐faith
suit
against
his
workers’
compensation
carrier
for
denying
medical
benefits
because
Commission
had
exclusive
jurisdiction
to
determine
claimant's
entitlement
to
medical
benefits);
Henry
v.
Dillard
Dept.
Stores,
Inc.,
70
S.W.3d
808,
809
(Tex.
2002)
(holding
that
trial
court
did
not
have
jurisdiction
to
adjudicate
injured
worker’s
suit
against
self-­‐insured
employer
for
bad
faith
denial
of
reasonable
and
timely
benefits);
Macias
v.
Schwedler,
135
S.W.3d
826,
830
(Tex.
App.—Houston
[1st
Dist.]
2004,
pet.
denied)
(holding
that
trial
court
did
not
have
jurisdiction
to
adjudicate
wrongful
death
action
against
workers’
compensation
carrier
because
the
claims
depended
on
determination
that
worker
sustained
compensable
injury)).
65. Moreover,
iWorks
Defendants
cannot
cite
this
Court
to
one
Texas
court
opinion
holding
that
the
DWC
has
exclusive
jurisdiction
over
common-­‐law
negligence
claims
like
Plaintiffs
or
contractual
indemnity
claims
like
iWorks
Defendants’.
See,
e.g.
In
re
Texas
Mut.
Ins.
Co.,
157
S.W.3d
at
81.
66. That
is
because
Texas
law
is
clear
that
the
DWC
does
not
have
exclusive
jurisdiction
over
common-­‐law
claims
that
are
not
seeking
workers’
compensation
benefits:
“[A]
negligence
claim
is
outside
the
[Workers’
Compensation]
Commission’s
exclusive
jurisdiction.
The
Commission’s
exclusive
jurisdiction
extends
to
claims
for
benefits
under
workers’
compensation
insurance
policies.”
In
re
Texas
Mut.
Ins.
Co.,
157
S.W.3d
75,
81
(Tex.
App.—Austin
2004,
pet.
denied)
(orig.
proceeding)
(citing
Tex.
Lab.
Code
Ann.
§
408.001(a)).1
67. In
addition
to
common-­‐law
tort
claims,
“[c]ourts
regularly
preside
over
the
hashing
out
of
the
contractual
relationships
between
staff
leasing
companies,
their
client
companies,
and
even
on
occasion
their
carriers.”
AMS
Constr.
Co.
v.
K.H.K.
Scaffolding
Hous.,
Inc.,
357
S.W.3d
at
39.
For
example,
in
Tex.
Workers'
Compensation
Fund
v.
Del
Indus.
Inc.,
the
supreme
court
held
that
the
workers
leased
from
a
staff
leasing
company
to
a
client
company
were
not
the
client
company’s
employees
for
the
purposes
of
1
The
quote
above
was
taken
directly
from
a
case
that
iWorks
Defendants
cited
in
their
PTJ.
In
fact,
the
quoted
text
is
located
only
4
paragraphs
after
an
excerpt
cited
by
iWorks
Defendants
in
their
PTJ.
PLAINTIFFS’
RESPONSE
TO
IWORKS
DEFENDANTS’
PLEA
TO
THE
JURISDICTION
15
computing
the
premiums
for
the
client
company’s
own
workers’
compensation
insurance.
35
S.W.3d
591,
596
(Tex.
2000).
68. In
re
Texas
Mut.
Ins.
Co.,
157
S.W.3d
75
(Tex.
App.—Austin
2004,
pet.
denied).
In
In
re
Texas
Mut.,
an
employer
brought
two
claims
against
Texas
Mutual
Insurance
Company:
(1)
breach
of
the
insurance
contract
by
refusing
to
provide
coverage
during
the
disputed
period;
and
in
the
alternative
(2)
negligence
in
causing
the
insured
to
have
a
coverage
gap.
157
S.W.3d
at
77.
69. Not
long
into
its
discussion
of
exclusive
jurisdiction,
the
court
in
In
re
Tex.
Mut.
Ins.
Co.
explained
that
the
Workers’
Compensation
Commission
has
exclusive
jurisdiction
over
one
thing—the
award
of
workers’
compensation
benefits.
157
S.W.3d
at
78.
Specifically,
the
court
said
“[t]he
[Texas
Workers’
Compensation]
Act
‘vests
the
power
to
award
compensation
benefits
solely
in
the
Workers’
Compensation
Commission
(formerly
the
Industrial
Accident
Board),
subject
to
judicial
review.”
Id.
(citing
American
Motorists
Ins.
Co.
v.
Fodge,
63
S.W.3d
801,
803
(Tex.
2001)
(emphasis
added).
70. On
the
other
hand,
the
DWC
does
not
have
exclusive
jurisdiction
over
claims
that
do
not
seek
an
award
of
workers’
compensation
benefits.
Id.
at
81.
71. The
Court
in
In
re
Tex.
Mut.
ultimately
held
that
the
DWC
had
exclusive
jurisdiction
over
the
plaintiff’s
breach
of
contract
claims
because
they
(1)
presupposed
“the
existence
of
a
workers’
compensation
insurance
policy,”
and
(2)
“quite
plainly
[sought]
benefits
due
under
that
policy.”
Id.
at
80-­‐
81
(citing
Fodge,
63,
S.W.3d
at
803).
72. By
contrast,
the
plaintiff’s
negligence
claim
presupposed
that
no
workers’
compensation
insurance
policy
was
in
effect
at
the
time
of
the
plaintiff’s
injuries.
Id.
at
81-­‐82.
Thus,
the
DWC
did
not
have
exclusive
jurisdiction
over
the
plaintiff’s
negligence
claim.
Id.
Moreover,
the
Court
swiftly
rejected
any
attempts
to
characterize
the
plaintiff’s
“negligence
damages
claim”
as
one
“seeking
the
specific
workers’
compensation
benefits
of
which
[plaintiffs]
were
negligently
deprived.”
Id.
at
81-­‐82.
73. AMS
Constr.
Co.
v.
K.H.K.
Scaffolding
Hous.,
Inc.,
357
S.W.3d
30
(Tex.
App.—Houston
[1st
Dist.]
2011,
pet.
denied).
AMS
Constr.
Co.
v.
K.H.K.
Scaffolding
Hous.,
Inc.
is
factually
analogous
to
the
case
at
bar.
There,
a
leased
employee
sued
the
client
company
for
negligence
and
gross
negligence
after
PLAINTIFFS’
RESPONSE
TO
IWORKS
DEFENDANTS’
PLEA
TO
THE
JURISDICTION
16
sustaining
work-­‐related
injuries.
Id.
at
35.
The
client
company
then
asserted
cross-­‐claims
against
the
staff
leasing
company
regarding
its
failure
to
maintain
workers’
compensation
insurance.
The
staff
leasing
company
contended
that
the
trial
court
lacked
subject
matter
jurisdiction
to
enter
a
judgment
against
it
on
the
client
company’s
breach
of
contract
claim
because
it
loosely
involved
the
issue
of
workers’
compensation
coverage.
Id.
at
37.
74. In
denying
the
leasing
company’s
plea
to
the
jurisdiction,
the
Court
held
that
“[t]his
case
does
not
involve
a
dispute
about
workers’
compensation
benefits
from
a
carrier
under
an
insurance
policy.”
357
S.W.3d
at
39.
Instead,
the
dispute
was
whether
AMS
was
contractually
obligated
to
obtain
workers’
compensation
benefits
for
a
leased
employee
from
an
insurance
carrier,
and
the
consequence
of
its
failure
to
do
so.
Id.
75. The
Court
in
AMS
Constr.
Co.
denied
the
plea
to
the
jurisdiction
for
the
same
reasons
that
this
Court
should
deny
iWorks
Defendants’
PTJ—to
wit:
(1) “Neither
AMS
nor
KHK
was
seeking
workers’
compensation
benefits
as
a
claimant
or
a
subclaimant
under
an
insurance
policy.”
=
Neither
iWorks
nor
WM
are
seeking
workers’
compensation
benefits
as
a
claimant
or
subclaimant
under
any
policy;
(2) “[The
employee]
sued
KHK
as
a
non-­‐subscriber.”
=
Plaintiffs
are
suing
iWorks
as
a
non-­‐
subscriber;
(3) “The
insurance
company
that
issued
AMS’s
workers’
compensation
insurance
policy
denied
him
coverage.”
=
Texas
Mutual
has
given
sworn
deposition
testimony
indicating
that
it
will
deny
coverage
on
iWorks’s
terminated
policy
(see
EXHIBIT
A);
and
(4) “AMS
never
produced
a
policy
that
covers
[plaintiff]
or
KHK.”
=
iWorks
has
never
produced
a
workers’
compensation
policy
that
covers
Mose
Guillory
or
WM.
AMS
Constr.
Co.,
357
S.W.3d
at
39.
76. APPLICATION.
Like
in
In
re
Texas
Mut.
Ins.
Co.,
this
Court
should
deny
iWorks
PTJ
because
Plaintiff’s
personal
injury
claims
do
not
seek
an
award
of
workers’
compensation
benefits.
157
S.W.3d
at
81.
To
the
contrary,
much
like
the
negligence
claims
asserted
in
In
re
Tex.
Mut.,
Plaintiffs’
claims
here
presuppose
that
no
workers’
compensation
insurance
was
in
effect
at
the
time
of
the
Mose
Guillory’s
injuries.
See
id.
at
81-­‐82.
PLAINTIFFS’
RESPONSE
TO
IWORKS
DEFENDANTS’
PLEA
TO
THE
JURISDICTION
17
77. Further,
as
in
AMS
Constr.
Co.,
“[t]his
case
does
not
involve
a
dispute
about
workers’
compensation
benefits
from
a
carrier
under
an
insurance
policy.”
357
S.W.3d
at
39.
Plaintiffs
are
not
seeking
workers’
compensation
insurance
benefits
from
WM
Defendants
or
iWorks
Defendants.
Instead,
Plaintiffs
are
seeking
compensatory
damages
under
common-­‐law
tort
principles.
78. On
February
19,
2015,
iWorks
Defendants
filed
a
supplement
to
their
PTJ
pointing
out
2
immaterial
facts:
(1)
that
Texas
Mutual
created
a
claim
number
for
iWorks
Defendants’
phantom
workers’
compensation
claim
on
their
non-­‐existent
policy;
and
(2)
that
Plaintiffs
served
a
DWC
41
Notice
of
Injury
Form
on
the
one-­‐year
anniversary
of
Mose
Guillory’s
injury.
79. As
to
the
first
point,
iWorks
Defendants
provide
no
argument
or
authority
explaining
how
Texas
Mutual’s
creation
of
a
claim
prejudices
Plaintiff’s
right
to
sue
his
non-­‐subscribing
employer.
As
to
the
second
point,
iWorks
Defendants
claim
that
“Plaintiff
cannot
hedge
his
bets
with
the
administrative
agency
while
improperly
seeking
a
judicial
remedy
in
this
Court[.]”
iWorks
Supp.
to
PTJ
at
p.
2.
80. First,
iWorks
Defendants
provide
no
authority
for
this
proposition—it
is
merely
Counsel
for
iWorks’s
unfounded
opinion.
In
accordance
with
the
Texas
Labor
Code
Ch.
409,
Plaintiffs
did
previously
file
their
DWC
41
form
on
the
1-­‐year
anniversary
of
the
injury
in
question.
However,
Plaintiffs
did
so
solely
to
preserve
their
right
to
seek
benefits
in
the
event
that
this
Court
or
the
Court
of
Appeals
later
determined
that
iWorks
Defendants
and/or
WM
Defendants
were
workers’
compensation
subscribers.
Plaintiffs
are
not
seeking
workers’
compensation
benefits
from
any
provider,
and
are
surely
not
attempting
to
get
blood
from
the
turnip
that
is
iWorks
Defendants’
cancelled
policy.
81. Moreover,
Plaintiffs’
direct
this
Court
to
Footnote
1
on
page
2
of
iWorks
Defendants’
PTJ,
which
reads
as
follows:
“By
filing
a
claim
on
its
worker’s
compensation
insurance,
iWORKS
does
NOT
waive
or
otherwise
retreat
from
its
position
that
Guillory’s
injury
is
the
sole
responsibility
of
Waste
Management
and/or
Guillory
and
expressly
reserves
its
rights
to
raise
these
issues
in
the
administrative
proceedings
(if
any)
and
any
judicial
review
of
any
administrative
determinations.”
iWorks
PTJ,
p.
1,
n.
1.
That
sounds
an
awful
lot
like
hedging
one’s
bets
with
the
administrative
agency
while
waiting
for
the
judicial
review
to
play
out.
What’s
good
for
the
goose
is
good
for
the
gander.
PLAINTIFFS’
RESPONSE
TO
IWORKS
DEFENDANTS’
PLEA
TO
THE
JURISDICTION
18
82. AMS
Constr.
Co.,
In
re
Tex.
Mut.,
and
Fodge
illustrate
that
the
DWC’s
exclusive
jurisdiction
does
not
apply
to
Plaintiffs’
claims
here
because
Plaintiffs’
claims
have
nothing
to
do
with
the
payment
of
or
claims
for
workers’
compensation
benefits.
Plaintiffs
have
never
made
a
claim
for
workers’
compensation
benefits
from
any
provider
in
this
case.
83. Tex.
Mut.
Ins.
Co.
v.
Ruttiger,
381
S.W.3d
430
(Tex.
2012)
and
Morales
v.
Liberty
Mut.
Sinc.
Co.,
241
S.W.3d
514
(Tex.
2007)
are
inapposite
and
neither
case
aids
iWorks
Defendants
with
regard
to
their
unsustainable
argument.
Ruttiger
and
Morales
are
inapplicable
here
because
the
Texas
Supreme
Court
merely
confirmed
that
the
DWC’s
exclusive
jurisdiction
and
the
requirement
for
exhausting
administrative
remedies
only
apply
to
claims
for
the
payment
or
non-­‐payment
of
workers’
compensation
benefits.
Ruttiger,
381
S.W.3d
at
436-­‐37;
Morales,
241
S.W.3d
at
519.
84. Additionally,
in
its
citation
to
Ruttiger,
Counsel
for
iWorks
is
blatantly
attempting
to
mislead
the
Court.
Counsel
for
iWorks
cherry
picks
and
manipulates
the
Court’s
holding
as
follows:
“The
court
recognized
that
allowing
an
employee
to
circumvent
the
act
by
asserting
common
law
causes
of
action
would
be
‘inconsistent
with
the
Act’s
goals
and
legislative
intent’.”
iWorks
PTJ
at
p.
9.
85. In
the
preceding
sentence,
the
Ruttiger
Court
expressly
stated
that
its
holding
did
not
apply
to
common-­‐law
claims—to
wit:
Permitting
a
workers’
compensation
claimant
to
additionally
recover
by
simply
suing
under
general
provisions
of
Insurance
Code
section
541.060
would
be
inconsistent
with
the
structure
and
detailed
processes
of
the
Act.
Tex.
Mut.
Ins.
Co.
v.
Ruttiger,
381
S.W.3d
430,
443
(Tex.
2012).
Thus,
the
analysis
in
Ruttiger
does
not
avail
iWorks
because
it
pertained
to
bad-­‐faith
insurance
lawsuits
over
the
denial
of
insurance
benefits—not
common-­‐law
personal
injury
claims.
86. Many
of
the
other
cases
cited
by
iWorks
Defendants
similarly
disprove
iWorks’
PTJ
on
their
face.
iWorks
Defendants
cite
In
re
Liberty
Ins.
Corp.
for
the
proposition
that
“[t]he
Workers’
Compensation
Act
vests
the
Workers’
Compensation
Division
with
exclusive
jurisdiction
to
determine
a
claimant's
entitlement
to
medical
benefits.”
321
S.W.3d
630,
636
(Tex.
App.—Houston
14th
[Dist.]
2010,
orig.
proceeding).
iWorks
Defendants
also
cite
In
Re
Mid-­‐Century
Ins.
Co.
of
Tex.
for
the
proposition
that
“[t]he
PLAINTIFFS’
RESPONSE
TO
IWORKS
DEFENDANTS’
PLEA
TO
THE
JURISDICTION
19
Worker’s
Compensation
Act
gives
the
DWC
exclusive
jurisdiction
over
certain
workers’
compensation
disputes
relating
to
entitlement
to
medical
benefits,
preauthorization
of
medical
care
and
reimbursement
of
medical
expenses.”
In
Re
Mid-­‐Century
Ins.
Co.
of
Tex.,
426
S.W.3d
169,
172
(Tex.
App.—Houston
[1st
Dist.]
2012,
orig.
proceeding).
87. These
holdings
are
irrelevant
because
Plaintiffs
are
not
suing
iWorks
Defendants
for
medical
benefits
under
workers’
compensation—Plaintiffs
are
suing
for
compensatory
damages
under
tort
law.
88. iWorks
Defendants
also
improperly
cite
and
rely
on
Port
Elevator-­‐Brownsville,
L.L.C.
v.
Casados,
358
S.W.3d
238
(Tex.
2012).
There,
it
was
undisputed
that
the
employer
had
a
valid
workers’
compensation
policy,
but
the
question
was
whether
or
not
it
covered
temporary
workers.
Id.
at
243.
89. The
Court
held
that
“a
client
company
is
entitled
to
the
exclusive
remedy
defense
upon
showing
that
it
was
the
plaintiff’s
employer
and
that
it
was
covered
by
a
workers’
compensation
policy.”
Id.
In
Casados,
the
employer
could
assert
the
exclusive
remedy
defense
against
a
temporary
common
worker
even
though
its
workers’
compensation
policy
purported
to
exclude
such
workers
and
even
though
it
never
paid
premiums
to
cover
such
workers.
Id.
at
243-­‐244.
90. iWorks
Defendants
are
using
that
holding
to
argue
that
a
company
can
cease
paying
premiums
altogether,
allow
its
workers’
compensation
policy
to
be
cancelled,
yet
continue
to
reap
the
benefits
of
being
a
subscriber.
Such
an
absurd
result
cannot
be
extrapolated
from
the
opinion
in
Casados.
91. Finally,
the
DWC
Appeals
Panel
Decisions
cited
in
iWorks’
motion
are
inapposite.
Those
decisions
resulted
from
contested
case
hearings
regarding
the
payment
or
non-­‐payment
of
workers’
compensation
insurance
benefits.
It
bears
repeating
that
Plaintiffs’
claims
are
common-­‐law
tort
claims—Negligence;
Negligent
Hiring,
Training,
Supervision,
Retention;
Negligence
Per
Se;
and
Gross
Negligence.
Thus,
Plaintiffs’
claims
have
NOTHING
to
do
with
entitlement,
request,
award,
payment,
or
non-­‐payment
of
workers’
compensation
benefits.
92. Like
the
common-­‐law
claims
in
AMS
Constr.
Co.,
the
DWC
lacks
exclusive
jurisdiction
over
Plaintiffs’
claims
and
this
Court
should
deny
iWorks
PTJ
accordingly.
PLAINTIFFS’
RESPONSE
TO
IWORKS
DEFENDANTS’
PLEA
TO
THE
JURISDICTION
20
b. THE
COURT
SHOULD
DENY
IWORKS
DEFENDANTS’
PTJ
BECAUSE
IWORKS
DEFENDANTS
HAVE
FAILED
TO
CONCLUSIVELY
PROVE
THEY
WERE
WORKERS’
COMPENSATION
“SUBSCRIBERS”.
93. In
their
PTJ,
iWorks
Defendants
spend
much
time
and
effort
apparently
attempting
to
educate
the
Court
on
the
administrative
procedures
followed
within
the
workers’
compensation
claims
process.
See
iWorks
PTJ
at
pp.
8-­‐11,
13.
However,
before
launching
into
their
gratuitous
diatribe
on
administrative
protocol,
iWorks
Defendants
conveniently
neglect
to
address
the
threshold
issue—i.e.
the
existence
of
an
active,
applicable
workers’
compensation
policy.
94. If
the
case
law
makes
anything
clear,
it
is
that
the
Court
does
not
even
reach
the
issue
of
the
DWC’s
exclusive
jurisdiction
and
the
exhaustion
administrative
remedies
if
it
determines
that
iWorks
Defendants
are
“non-­‐subscribers”
as
to
Mose
Guillory.
95. The
Court
in
Port
Elevator-­‐Brownsville,
L.L.C.
v.
Casados
begins
and
ends
its
analysis
with
this
essential
element—the
existence
of
worker’s
compensation
coverage.
358
S.W.3d
238
(Tex.
2012).
In
fact,
the
Texas
Supreme
Court’s
holding
in
Casados
begins
as
follows:
“Because
Port
Elevator
had
a
workers’
compensation
policy[.]”
Id.
at
239.
96. Moreover,
the
Texas
Supreme
Court
has
made
it
abundantly
clear
that
the
fundamental
prerequisite
for
the
exclusive-­‐remedy
defense
is
the
existence
of
a
valid,
effective
workers’
compensation
policy
existing
at
the
time
of
the
incident
in
question.
For
example,
the
Court
in
Casados
noted
that
“employer”
under
the
Texas
Workers’
Compensation
Act
means
“a
person
who
makes
a
contract
of
hire,
employs
one
or
more
employees,
and
has
workers’
compensation
insurance
coverage.”
Casados,
358
S.W.3d
at
241
(emphasis
added).
97. One
page
later,
the
Court
held
that
“each
employer
who
subscribes
to
workers’
compensation
insurance
may
raise
the
exclusive-­‐remedy
provision
as
a
bar
to
claims
about
the
injury.”
Casados,
358
S.W.3d
at
242
(emphasis
added)
(citing
Garza
v.
Excel
Logistics,
Inc.,
161
S.W.3d
473,
475-­‐76
(Tex.
2005)
(stating
that
client
company
could
assert
exclusive-­‐remedy
defense
to
claims
by
temporary
employee
if
it
PLAINTIFFS’
RESPONSE
TO
IWORKS
DEFENDANTS’
PLEA
TO
THE
JURISDICTION
21
was
covered
by
workers’
compensation
insurance);
Wingfoot
Enters.
v.
Alvarado,
111
S.W.3d
134,
143
(Tex.
2003).
98. It
is
important
to
note
that
the
Court
in
Casados
used
the
present
tense
form
of
the
verbs
“has”
and
“subscribes”
instead
of
the
past
tense
(“had,”
“subscribed”)
or
the
future
tense
(“will
have,”
“will
subscribe.”).
Thus,
an
employer’s
status
as
a
workers’
compensation
“subscriber”
has
nothing
to
do
with
whether
it
maintained
some
workers’
compensation
policy
in
the
past
(as
iWorks
did
here)
or
whether
it
plans
to
obtain
workers’
compensation
in
the
future.
99. If
that
were
the
case,
every
Texas
business
could
obtain
a
workers’
compensation
policy,
cancel
it
after
one
month,
and
still
be
considered
a
“subscriber”
in
perpetuity
merely
because
it
had
workers’
compensation
coverage
at
some
irrelevant
point
in
the
past.
Such
an
illogical
result
was
clearly
not
the
intent
of
the
Texas
Legislature
when
fashioning
the
Workers’
Compensation
Act.
100. Additionally,
an
employer’s
status
as
a
“subscriber”
has
nothing
to
do
with
whether
the
employer
intended
to
have
coverage
or
whether
it
plans
to
obtain
coverage
in
the
future.
Only
the
employer
who
“has”
or
“subscribes”
to
workers’
compensation
insurance
may
raise
the
exclusive-­‐remedy
provision
as
a
bar
to
claims
about
the
injury.
Casados,
358
S.W.3d
at
242.
For
iWorks
Defendants
to
have
had
workers’
compensation
coverage
in
this
case,
they
needed
a
valid
workers’
compensation
policy
that
was
effective
on
the
date
of
the
incident
in
question.
As
confirmed
by
the
DWQ
responses
attached
hereto
as
EXHIBIT
A
and
EXHIBIT
B,
iWorks
Defendants
failed
to
meet
this
requirement.
101. The
Court
in
Casados
also
explained
why
the
“Exclusive
Remedy”
provision
is
obviously
inequitable
if
there
is
no
valid
workers’
compensation
policy
covering
the
incident
in
question.
The
first,
basic
premise
behind
the
Workers’
Compensation
Act
is
that
Texas
employers
are
permitted
to
choose
whether
or
not
to
maintain
workers’
compensation
insurance.
Casados,
358
S.W.3d
at
241.
In
response,
employees
of
subscribing
employers
can
choose
whether
to
accept
such
coverage
or
opt
out
and
retain
their
common-­‐law
rights.
Id.
(citing
Tex.
Lab.
Code
§
406.034;
Lawrence
v.
CDB
Servs.,
Inc.,
44
S.W.3d
544,
552
(Tex.
2001)).
PLAINTIFFS’
RESPONSE
TO
IWORKS
DEFENDANTS’
PLEA
TO
THE
JURISDICTION
22
102. The
Court
in
Casados
goes
on
to
explain
the
intention
of
the
Texas
Legislature
and
the
rationale
that
justifies
this
law:
“The
Legislature
intended
the
TWCA
to
benefit
both
employees
and
employers.
For
employees,
the
TWCA
allows
them
to
recover
workers’
compensation
benefits
for
injuries
in
the
course
and
scope
of
employment
without
proving
fault
by
the
employer
and
without
regard
to
their
negligence
.
.
.
For
employers,
their
liability
to
employees
is
limited.”
Id.
at
241
(citing
Tex.
Lab.
Code
§
406.031).
103. It
is
clear
that
the
rationale
of
the
Texas
Legislature
and
Texas
Supreme
Court
assumes
the
existence
of
workers’
compensation
insurance
coverage,
and
it
must.
Otherwise,
what
is
the
employee
being
forced
to
give
up
his
common
law
rights
for?
104. It
cannot
be
argued
that
the
Texas
Legislature
intended
for
this
Court
to
dismiss
Mose
Guillory’s
claims
against
iWorks,
only
to
have
iWorks
then
hand
him
the
same,
expired,
terminated
policy
information
page
and
say:
“Sorry,
you
don’t
get
workers’
compensation
coverage
because
I
DIDN’T
DO
MY
JOB
.
.
.
I
BLEW
IT.”
That
was
not,
and
is
not,
the
intent
behind
the
workers’
compensation
act
and
this
Court
should
not
follow
iWorks
Defendants
down
this
non-­‐sensical
path.
See
Casados
at
241
(citing
Tex.
Lab.
Code
§
406.031).
c. ALTERNATIVELY,
THIS
COURT
SHOULD
DENY
IWORKS
DEFENDANTS’
PTJ
BECAUSE
PLAINTIFFS’
CLAIMS
FALL
UNDER
AN
EXCEPTION
TO
THE
RULE
REGARDING
EXHAUSTION
OF
REMEDIES.
105. Plaintiffs
incorporate
all
preceding
paragraphs
by
reference
as
though
fully
set
forth
herein.
106. In
the
unlikely
event
that
this
Court
agrees
with
iWorks
Defendants’
argument,
the
Court
should
still
deny
iWorks
Defendants’
PTJ
because
Plaintiffs’
claims
fall
within
the
recognized
exceptions
to
exhaustion
of
remedies.
107. Texas
courts
have
recognized
four
exceptions
to
the
exhaustion
requirement:
(1)
exhausting
agency
procedures
would
cause
irreparable
harm;
(2)
the
agency
cannot
grant
the
requested
relief,
such
as
with
constitutional
claims;
(3)
the
cause
of
action
involves
a
pure
question
of
law
and
the
facts
are
undisputed;
and
(4)
the
agency
has
acted
beyond
its
jurisdiction.
Tex.
Educ.
Agency
v.
Cypress-­‐Fairbanks
Indep.
Sch.
Dist.,
830
S.W.2d
88,
90-­‐91
(Tex.
1992);
Houston
Fed.
of
Teachers
v.
Houston
Indep.
Sch.
Dist.,
PLAINTIFFS’
RESPONSE
TO
IWORKS
DEFENDANTS’
PLEA
TO
THE
JURISDICTION
23
730
S.W.2d
644,
646
(Tex.
1987);
Janik
v.
Lamar
Consol.
Indep.
Sch.
Dist.,
961
S.W.2d
322,
324
(Tex.
App.—Houston
[1st
Dist.]
1997,
pet.
denied).
108. Plaintiffs
have
already
incurred
the
time
and
expense
of
litigating
this
lawsuit
for
nearly
2
½
years.
During
that
time,
Mose
and
Mary
Guillory
have
endured
the
tremendous
hardship
of
Mr.
Guillory’s
disabilities
and
his
inability
to
work.
Moreover,
the
2-­‐year
statute
of
limitations
on
Plaintiffs’
tort
claims
has
run.
As
such,
it
would
cause
irreparable
harm
were
this
Court
to
force
Plaintiffs
to
incur
the
additional
time
and
expense
of
the
administrative
gauntlet
only
to
have
the
DWC
tell
Plaintiffs
what
they
already
know—iWorks
Defendants
are
non-­‐subscribers.
109. The
DWC
cannot
grant
all
of
Plaintiffs’
requested
relief.
The
Texas
Workers’
Compensation
Act
places
caps
on
the
pecuniary
benefits
that
may
be
awarded
and
does
not
provide
for
non-­‐pecuniary
damages
such
as
pain
and
suffering,
mental
anguish,
etc.
These
are
damages
that
Plaintiffs
are
seeking
and
which
the
DWC
cannot
provide.
110. Based
on
the
foregoing,
this
Court
should
deny
iWorks
PTJ
because
Plaintiffs’
claims
fall
within
recognized
exceptions
to
the
requirement
for
exhaustion
of
remedies.
VI. CONCLUSION
111. Plaintiffs
incorporate
all
preceding
paragraphs
by
reference
as
though
fully
set
forth
herein.
112. iWorks
Defendants
are
asking
this
Court
to
take
unprecedented
action
that
directly
contradicts
binding
precedent
handed
down
from
the
1st
District
Court
of
Appeals
only
4
years
ago.
See
AMS
Constr.
Co.,
357
S.W.3d
at
39.
In
effect,
iWorks
Defendants
are
asking
this
Court
to
re-­‐write
the
Texas
Labor
Code
so
as
to
extend
the
DWC’s
exclusive
jurisdiction
to
common-­‐law
claims
over
which
it
has
no
jurisdiction.
113. More
than
that,
iWorks
Defendants
are
asking
this
Court
to
strip
away
its
general
jurisdiction
to
hear
common-­‐law
tort
claims.
The
only
way
such
action
is
permitted
is
if
iWorks
Defendants
conclusively
prove
their
entitlement
to
the
“Exclusive
Remedy”
defense.
However,
iWorks
Defendants
are
not
entitled
to
the
“Exclusive
Remedy”
defense
because
iWorks
Defendants
are
non-­‐subscribers.
114. Because
plaintiff’s
pleadings
establish
the
court’s
jurisdiction,
and
defendant’s
factual
allegations
disputing
jurisdiction
are
untrue,
the
court
should
retain
plaintiff’s
suit
on
the
court’s
docket.
PLAINTIFFS’
RESPONSE
TO
IWORKS
DEFENDANTS’
PLEA
TO
THE
JURISDICTION
24
VII. PRAYER
115. For
these
reasons,
Plaintiffs
pray
that
this
Court
DENY
iWorks
Defendants
Plea
to
the
Jurisdiction
and
grant
Plaintiffs
such
other
and
further
relief
to
which
they
have
shown
themselves
justly
entitled.
Respectfully
submitted,
GILDE
LAW
FIRM
___________________________________
BRADFORD
J.
GILDE
TSB#:
24045941
NICHOLAS
A.
HOMAN
TSB#:
24083194
55
Waugh
Dr.,
Ste.
800
Houston,
TX
77007
281-­‐973-­‐2771
–
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P.
MATTHEWS
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facsimile
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FOR
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CERTIFICATE
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foregoing
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facsimile
and/or
eTexFile
on
February
19,
2015.
Respectfully
1. submitted,
Nicholas
A.
Homan
PLAINTIFFS’
RESPONSE
TO
IWORKS
DEFENDANTS’
PLEA
TO
THE
JURISDICTION
25
EXHIBIT
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EXHIBIT
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WMRA 000022
WMRA 000023
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000008
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IN THE SUPREME COURT OF TEXAS
════════════
NO. 14-0256
════════════
IN RE CRAWFORD & COMPANY, CRAWFORD & COMPANY HEALTHCARE
MANAGEMENT, INC., PATSY HOGAN AND OLD REPUBLIC INSURANCE
COMPANY, RELATORS
══════════════════════════════════════════
ON PETITION FOR WRIT OF MANDAMUS
══════════════════════════════════════════
PER CURIAM
Relators in this mandamus proceeding contend that the trial court abused its discretion
when it refused to dismiss claims over which the Division of Workers’ Compensation has
exclusive jurisdiction. Because all of the claims arise out of relators’ investigation, handling, and
settling of claims for workers’ compensation benefits, we agree.
In 1998, Glenn Johnson suffered traumatic and debilitating injuries while working for
ASARCO. The parties do not dispute that Johnson was severely injured or that he is entitled to
receive lifetime workers’ compensation benefits. Disputes over the details and amounts of those
benefits, however, led Johnson to request a benefit review conference in 2008, which led to a
contested case hearing the following year. It appears from the parties’ briefs that the suit for
judicial review of that decision remains pending in the district court.
Meanwhile, separate from the administrative proceedings, Johnson and his wife, Natalie,
filed the underlying suit against ASARCO’s workers’ compensation insurance provider Old
Republic Insurance Company; its claims services contractors Crawford & Company and Crawford
& Company Healthcare Management, Inc.; and their employee Patsy Hogan (collectively,
Crawford). The Johnsons allege that, over a period of nearly ten years, Crawford engaged in “a
battle plan to delay, discourage and deny” benefits that the Johnsons were entitled to receive.
Specifically, the Johnsons contend that Crawford (a) wrongfully disputed, denied, and delayed
medical benefits, (b) misrepresented which benefits were and were not covered, (c) failed to
provide required notices and other information, (d) repeatedly agreed to pay for benefits and
services but then refused to do so, (e) performed inadequate and misleading investigations into the
Johnsons’ claim for benefits, and (f) falsely accused the Johnsons of insurance fraud, leading to
their wrongful arrests and a two-year prosecution that ultimately terminated in the Johnsons’ favor.
In short, the Johnsons allege that, “[r]ather than manage the claim” and adjust it “in a fair and
reasonable manner,” Crawford “resorted to combat tactics to wreak havoc on Glenn’s and
Natalie’s lives.”
Based on these allegations, the Johnsons pled numerous causes of action, some sounding
in tort (negligence; gross negligence; negligent, fraudulent, and intentional misrepresentation;
fraud; fraud by non-disclosure; fraudulent inducement; intentional infliction of emotional distress;
malicious prosecution; and conspiracy); some sounding in contract (breach of contract; quantum
meruit; and breach of the common law duty of good faith and fair dealing); and some alleging
violations of statutory duties (under the Texas Insurance Code and the Texas Deceptive Trade
Practices Act). The Johnsons sought relief in the form of actual damages for physical injuries,
mental injuries, loss of income, and loss of reputation; exemplary damages; statutory damages;
and injunctive relief prohibiting Crawford from continuing to engage in such “extreme and
outrageous” conduct.
The Johnsons specifically pled that the Texas Workers’ Compensation Act does not require
them to pursue their claims through its administrative procedures or otherwise exhaust
2
administrative remedies because (1) the Act’s administrative procedures do not apply to some of
their claims; (2) Crawford’s “subterfuge” of the workers’ compensation system relieves the
Johnsons from any duties under that system; and (3) the Johnsons are seeking to recover for
“independent injuries . . . that are unrelated to [Glenn’s] workers[’] compensation injuries and the
benefits that he is entitled to under that system.” While the Johnsons agree that they must pursue
their claims for workers’ compensation benefits through the administrative process, they contend
that they can pursue these claims for additional, independent, and “unrelated” damages in the
courts.
Crawford disagreed and filed a plea to the jurisdiction and motion for summary judgment.
Relying primarily on our decision in Texas Mutual Insurance Co. v. Ruttiger, 381 S.W.3d 430
(Tex. 2012), Crawford argued that the Texas Department of Insurance Division of Workers’
Compensation has exclusive jurisdiction over all of the Johnsons’ claims because they arise out of
the workers’ compensation claims-handling process. Conceding that the claims for malicious
prosecution and for intentional infliction of emotional distress could “arguably survive the
landmark decision in Ruttiger,” Crawford alternatively asserted that no evidence supported those
claims. The trial court dismissed the Johnsons’ claims for breach of the common law duty of good
faith and fair dealing and for violations of the Texas Insurance Code but refused to dismiss any of
the other claims. The court of appeals denied Crawford’s petition for mandamus relief.1
1
___ S.W.3d ___. The court of appeals concluded that Crawford is not entitled to mandamus relief because
(1) “one could interpret” Crawford’s five-month delay in filing its petition for writ of mandamus, shortly before trial,
as an “effort to further hinder the timely adjudication of the Johnsons’ claims”; (2) even if the court could review the
denial of Crawford’s plea to the jurisdiction by mandamus, Crawford has not shown that “unrelated topics appearing
in the motion for summary judgment may also be reviewed via the same proceeding”; (3) the Johnsons created a fact
issue by certifying through their counsel that they had exhausted all administrative remedies; and (4) “claims of
malicious prosecution inherently involve activity or misconduct outside the administrative avenues created by the
workers’ compensation laws,” nothing in the Act “purports to regulate such conduct or remedy . . . damages unrelated
to the amount of workers’ compensation benefits to which an employee may be entitled,” and “because at least one
3
We conclude that the Division of Workers’ Compensation has exclusive jurisdiction over
the Johnsons’ claims and the Workers’ Compensation Act provides their exclusive remedies. The
Act designates the Department of Insurance as the administrative agency responsible “[for
overseeing] the workers’ compensation system of this state” and establishes the Division of
Workers’ Compensation within the Department to “administer and operate” that system. TEX. LAB.
CODE § 402.001. It is the Division’s duty to “(1) regulate and administer the business of workers’
compensation in this state; and (2) ensure that [the Act] and other laws regarding workers’
compensation are executed.” Id. § 402.00114. The Division must monitor insurance carriers,
employers, and others “for compliance with commissioner rules, this subtitle, and other laws
relating to workers’ compensation.” Id. § 414.002(a). The Division or its commissioner may
impose an array of sanctions against those who fail to comply, including a cease-and-desist order
and administrative penalties up to $25,000 per day per occurrence. Id. § 415.021(a). As we
explained in Ruttiger, the Act, as substantially revised in 1989, “prescribes detailed, [Division]-
supervised, time-compressed processes for carriers to handle claims and for dispute resolution”
and “has multiple, sometimes redundant but sometimes additive, penalty and sanction provisions
for enforcing compliance with its requirements.” 381 S.W.3d at 443.
In light of the Act’s comprehensive system for resolving workers’ compensation claims 2
and the Division’s role in that process, we concluded in Ruttiger that the Act provides the exclusive
procedures and remedies for claims alleging that a workers’ compensation carrier has improperly
cause of action continues to exist, despite Ruttiger, we cannot say that the trial court abused its discretion in refusing
to dismiss all the causes of action.” Id. at ___.
2
See Liberty Mut. Ins. Co. v. Adcock, 412 S.W.3d 492, 495 (Tex. 2013) (explaining that “the Legislature
devised a comprehensive workers’ compensation system, with specific benefits and procedures based on the public
policy of the State of Texas. We concluded in Ruttiger that the Court should not alter the Act’s comprehensive scheme,
and we reaffirm that principle today.”).
4
investigated, handled, or settled a workers’ claim for benefits. Specifically, we held that the worker
in that case could not recover against the carrier for violations of section 541.060 of the Texas
Insurance Code, which prohibits all insurance carriers generally (not just workers’ compensation
carriers) from engaging in “unfair settlement practices with respect to a claim by an insured.” TEX.
INS. CODE § 541.060(a). “Permitting a workers’ compensation claimant to additionally recover by
simply suing under general provisions of Insurance Code section 541.060,” we explained, “would
be inconsistent with the structure and detailed processes of the Act.” Ruttiger, 381 S.W.3d at 443.
We concluded that the Act’s “provisions for dispute resolution and remedies for failing to comply
with those provisions in the workers’ compensation context are exclusive of those in section
541.060.” Id. at 444.3
We also held that the claimant in Ruttiger could not recover on his claims under section
542.003(a)(3) of the Insurance Code, which requires insurers to “adopt and implement reasonable
standards for the prompt investigation of claims arising under the insurer’s policies.” TEX. INS.
CODE § 542.003(a)(3). “[I]n light of the specific substantive and procedural requirements built into
the Act,” we concluded, “and the detrimental effects on carriers flowing from penalties that can be
imposed for failing to comply with those requirements, the Legislature did not intend for workers’
compensation claimants to have a cause of action against the carrier under the general provision
of section 542.003.” Ruttiger, 381 S.W.3d at 445.
For the same reasons, we also overruled our precedent that pre-dated the current version of
the Act and held that “an injured employee may not assert a common-law claim for breach of the
duty of good faith and fair dealing against a workers’ compensation carrier.” Id. at 433 (overruling
Aranda v. Ins. Co. of N. Am., 748 S.W.2d 210 (Tex. 1988)). We reasoned that allowing the carrier
3
We likewise held that the claimant could not recover on his DTPA claim because that claim, “as pled and
submitted to the jury[,] depended on the validity of his Insurance Code claim[s].” Ruttiger, 381 S.W.3d at 446.
5
to risk common law liability in addition to liability under the Act “distorts the balances struck in
the Act and frustrates the Legislature’s intent to have disputes resolved quickly and objectively.”
Id. at 451. “Recognizing and respecting the Legislature’s prime position in enacting, studying,
analyzing, and reforming the system, and its efforts in having done that,” we concluded that “[t]he
Act effectively eliminates the need for a judicially imposed cause of action outside the
administrative processes and other remedies in the Act.” Id.
We did not hold in Ruttiger, however, that the Act bars every statutory and common law
claim that can be asserted against a workers’ compensation carrier. To the contrary, we concluded
that the Act did not bar a claim under section 541.061 of the Insurance Code, which makes it
unlawful for an insurer to “misrepresent an insurance policy.” Id. at 445–46; see also TEX. INS.
CODE § 541.061. We explained that, “[u]nlike section 541.060,” which prohibits unfair settlement
practices, “section 541.061 does not specify that it applies in the context of settling claims.”
Ruttiger, 381 S.W.3d at 446. We held that because section 541.061’s prohibition against
misrepresentation of an insurance policy “does not evidence intent that it be applied in regard to
settling claims, it is not at odds with the dispute resolution process of the workers’ compensation
system.” Id. We ultimately concluded, however, that there was no evidence to support the section
541.061 claim in that case because there was no evidence of an “untrue statement made by [the
insurer] regarding the policy or any statement about the policy that misled [the plaintiff-insured].”
Id.
In summary, we held in Ruttiger that workers’ compensation carriers cannot be liable under
the Insurance Code for unfair claims settlement practices or for failing to adopt reasonable
standards for investigating claims, or under the common law for breach of a duty of good faith and
fair dealing, because these claims “simply are not compatible with amended detailed procedural
6
and substantive provisions of the new Act.” Id. at 456. Although we agreed that “the new Act’s
language does not purport to preclude all types of claims against workers’ compensation insurers,”
we concluded that, for claims arising out of the claims-settlement process, “the current Act with
its definitions, detailed procedures, and dispute resolution process demonstrate[s] legislative intent
for there to be no alternative remedies.” Id. at 444, 456.
In this case, the parties dispute whether and how Ruttiger applies to causes of action that
we did not specifically address in that case. The court of appeals concluded that it “is not as clear”
that we “vitiated the existence of” any other claims in Ruttiger because we “said nothing of” them.
___ S.W.3d ___. The court read our Ruttiger decision to focus on whether the claims are
“inconsistent with the current legislative/administrative workers’ compensation scheme,” and
concluded that neither Ruttiger nor Crawford explains how a malicious prosecution claim asserting
“baseless criminal proceedings by an insurer against an employee and the amelioration of damages
caused by such misconduct fits in the legislative/administrative workers’ compensation scheme.”
Id. at ___. The court concluded that a malicious prosecution claim “does not serve to protect,
secure or timely resolve disputes involving the availability of workers’ compensation benefits due
a claimant,” and “because at least one cause of action continues to exist, despite Ruttiger, [the
court could not] say that the trial court abused its discretion in refusing to dismiss all the causes of
action.” Id.
We agree with Crawford that the court of appeals read Ruttiger too narrowly. As other
courts of appeals have recognized,4 the rule we applied in Ruttiger is that the Act provides the
4
See, e.g., Davis v. Am. Cas. Co. of Reading, Pa., No. 07-13-00190-CV, 2014 WL 2553379, at *2 (Tex.
App.—Amarillo June 4, 2014, pet. denied) (holding that Ruttiger precludes claims for breach of contract, breach of
the duty of good faith and fair dealing, Insurance Code and DTPA violations, and negligence because all claims “arise
out of [the carrier’s] handling of [the] workers’ compensation claim”); Hopper v. Argonaut Ins. Co., No. 03-12-00734-
CV, 2013 WL 5853747, at *4 (Tex. App.—Austin Oct. 18, 2013, no pet.) (mem. op.) (holding that Ruttiger
“eliminates” claims because there is no evidence of any “conduct that does not implicate the claim-settlement process”
and all claims “are limited to complaints about delays, claim handling, and disputes regarding entitlement to benefits”);
7
exclusive process and remedies for claims arising out of a carrier’s investigation, handling, or
settling of a claim for workers’ compensation benefits. We held that the Act bars claims for breach
of the duty of good faith and fair dealing and claims under sections 541.060 and 542.003, not
because those are the only claims the Act bars, but because those claims are necessarily based on
the investigation and settlement of benefit claims. Ruttiger, 381 S.W.3d at 443–45. Similarly, we
held that the Act did not bar the claim under section 541.061, not because that is the only claim
the Act does not bar, but because that section does not address misrepresentations made “in regard
to settling claims” for benefits. Id. at 446.
Whether the Act provides the exclusive process and remedies, therefore, does not depend
on the label of the cause of action asserted. As we have often explained, claimants may not recast
claims to avoid statutory requirements or to qualify for statutory protections. See Diversicare Gen.
Partner, Inc. v. Rubio, 185 S.W.3d 842, 851 (Tex. 2005) (focusing on the essence of plaintiff’s
claim and finding it had to meet MLIIA requirements) (citing MacGregor Med. Ass’n v. Campbell,
985 S.W.2d 38, 38 (Tex. 1998); Gormley v. Stover, 907 S.W.2d 448, 450 (Tex. 1995) (per curiam)
(finding that plaintiff’s pleading was an attempt to recast malpractice claim as a DTPA action);
Sorokolit v. Rhodes, 889 S.W.2d 239, 242 (Tex. 1994) (emphasizing that health care liability claim
could not be re-cast as a different claim)). Instead, in assessing whether a claim falls within the
Division’s exclusive jurisdiction, courts must look at the substance of the claim. Id.
Bean v. Tex. Mut. Ins. Co., No. 09-11-00123-CV, 2012 WL 5450826, at *1 (Tex. App.—Beaumont Nov. 8, 2012, no
pet.) (mem. op.) (holding that claims “are within the exclusive jurisdiction of the Texas Department of Insurance”
because they “concern[] the claims handling process”); Carpenter v. Sw. Med. Examination Servs., Inc., 381 S.W.3d
583, 585–87 (Tex. App.—Eastland 2012, no pet.) (applying Ruttiger to hold that the Act precludes claims for
common-law bad faith, statutory bad faith, fraud, and conspiracy to commit fraud based on allegations that carrier
delayed paying benefits and concealed the nature of its relationship with reviewing doctor because the claims related
to “the manner in which the carrier had handled the processing of [the] workers’ compensation claim”).
8
Nor does the Ruttiger rule depend on the nature of the relief the claimant seeks. The
Johnsons contend that the Act does not bar their claims because they are seeking damages that are
“unrelated” to workers’ compensation benefits and based on injuries that are “independent” of
harm the Act is intended to prevent. As we noted in Ruttiger, however, “the current Act with its
definitions, detailed procedures, and dispute resolution process demonstrat[es] legislative intent
for there to be no alternative remedies.” 381 S.W.3d at 444.
Applying the Ruttiger rule to this case, we first conclude that the Act bars the Johnsons’
claims for negligence, gross negligence, breach of contract, quantum meruit, breach of the duty of
good faith and fair dealing, and statutory violations. In support of these causes of action, the
Johnsons allege that Crawford failed to act reasonably in responding to the Johnsons’ claims for
benefits and made and then breached promises and representations that it would pay certain
benefits. Because all of these claims arise out of Crawford’s investigation, handling, and settling
of the Johnsons’ claim for workers’ compensation benefits, the Act provides the exclusive
procedures and remedies for these claims.
We reach the same conclusion regarding all of the Johnsons’ common law and statutory
causes of action based on allegations of deception, fraud, and misrepresentation. Because we held
in Ruttiger that the Act does not necessarily bar a claim for misrepresenting an insurance policy
under section 541.061 of the Insurance Code, our analysis on these claims is a bit more complex.
The Johnsons contend that our holding in Ruttiger confirms that they can pursue all of their claims
for misrepresentation and fraud. But we based our holding in Ruttiger on the fact that “section
541.061 does not specify that it applies in the context of settling claims.” Ruttiger, 381 S.W.3d at
446. We held that, because section 541.061 “does not evidence intent that it be applied in regard
9
to settling claims, it is not at odds with the dispute resolution process of the workers’ compensation
system.” Id.
This case presents a question we did not expressly address in Ruttiger: whether the Division
has exclusive jurisdiction over a claim for “misrepresentation of an insurance policy” when the
alleged misrepresentation occurs within the claims-settlement context. We hold that it does.5 The
Act specifically addresses and prohibits a carrier from making misrepresentations, including
misrepresentations “to an employee” regarding the Act’s provisions and “the reason for not paying
benefits or terminating or reducing the payment of benefits.” TEX. LAB. CODE
§ 415.002(a)(1), (13). The Act’s comprehensive system for resolving workers’ compensation
claims encompasses prohibitions against fraud and misrepresentations made within the claims-
settlement context, and grants the Division authority to regulate and sanction any such conduct.
Because all of the Johnsons’ misrepresentation-based claims complain of misrepresentations that
Crawford allegedly made in connection with its investigation, handling, and settling of the
Johnsons’ claims for workers’ compensation benefits,6 we hold that the Division had exclusive
jurisdiction to address those claims.
5
At least two courts of appeals have reached this same conclusion. See Hopper, 2013 WL 5853747, at *1, 4
(holding that carrier was entitled to summary judgment on claim regarding “false statements” that claimants “were
not entitled to coverage” because the claim was “limited to complaints about delays, claim handling, and disputes
regarding entitlement to benefits”); Bean, 2012 WL 5450826, at *1 (holding that misrepresentation claims were within
the Division’s exclusive jurisdiction because those claims “concern[] the claims handling process,” and worker “did
not claim that the terms of the insurance policy covering his employer had been misrepresented to his employer”). As
the Hopper court explained, we stated in Ruttiger “that section 541.061 applies to misrepresentations of a policy’s
terms, not misrepresentations about whether a specific claim is factually within a policy’s terms.” Hopper, 2013 WL
5853747, at *3. The alleged misrepresentations in that case “concerned statements about whether [the worker’s] death
resulted from a compensable injury and whether the Hoppers were his true beneficiaries,” and “[a]lthough Ruttiger
did not specifically involve common-law claims of fraudulent and negligent misrepresentation or unconscionability,
these claims fail in the present case because there is no evidence here of any fraudulent, negligent, or unconscionable
conduct that does not implicate the claim-settlement process.” Id. at *3–*4.
6
The Johnsons allege, for example, that Crawford “made blatantly false statements to avoid coverage and to
avoid paying both income and medical benefits”; made “clearly untrue statements of material facts, including
withholding proper home healthcare and paying the injured worker and his spouse directly to arrange and provide
necessary care”; and “failed to state and to disclose known material facts that the lifetime income benefits were
payable.”
10
We now turn to the Johnsons’ claims for malicious prosecution and intentional infliction
of emotional distress, which are both based on allegations that Crawford falsely reported to a
district attorney that the Johnsons committed insurance fraud by requesting mileage
reimbursements for travel that had not occurred. We hold that the Division has exclusive
jurisdiction over these claims because they also arise out of Crawford’s investigation, handling,
and settling of the Johnsons’ claims for workers’ compensation benefits. The mileage
reimbursements at issue were part of the Johnsons’ medical benefits under the Act, and carriers
are required to report suspected fraud to the Department or to an authorized governmental entity
as part of their claims-handling responsibilities. TEX. INS. CODE § 701.051(a). If a carrier
knowingly and intentionally makes a false or misleading statement with the intent to deny the
payment of a benefit, as the Johnsons allege Crawford did in this case, the Act provides the
claimant with remedies, including criminal penalties. TEX. LAB. CODE §§ 415.008, 418.001.
Because the Johnsons’ causes of action for malicious prosecution and intentional infliction of
emotional distress arise out of Crawford’s investigation, handling, and settling of a workers’
compensation claim, we hold that the Division had exclusive jurisdiction over those complaints.7
Finally, we turn to the Johnsons’ argument that Natalie Johnson is not seeking relief as an
ASARCO employee and thus her claims are independent of the Act and therefore not barred by it.
7
Because the Act’s grant of exclusive jurisdiction bars the courts from exercising jurisdiction over the claims,
we reject the Johnsons’ complaints that Crawford waived its argument that the Act bars the claims for malicious
prosecution and is judicially estopped from raising them on mandamus. The Johnsons contend that Crawford’s counsel
“judicially admitted” in the trial court that the malicious prosecution claim “is outside of comp,” and “[c]omp has
nothing to do with malicious prosecution and we’re not arguing that it does.” We need not decide whether these
statements could constitute a waiver, judicial admission, or the basis for judicial estoppel, because even if they could,
such doctrines cannot create subject-matter jurisdiction where it does not otherwise exist. Wilmer-Hutchins Indep.
Sch. Dist. v. Sullivan, 51 S.W.3d 293, 294 (Tex. 2001) (“As a general rule, a court cannot acquire subject-matter
jurisdiction by estoppel.”); Dubai Petroleum Co. v. Kazi, 12 S.W.3d 71, 76 (Tex. 2000) (“[S]ubject-matter jurisdiction
is a power that ‘exists by operation of law only, and cannot be conferred upon any court by consent or waiver’ . . . .”)
(quoting Federal Underwriters Exch. v. Pugh, 141 Tex. 539, 174 S.W.2d 598, 600 (1943)).
11
Specifically, the Johnsons argue that Natalie “has causes of action for malicious prosecution,
intentional infliction of emotional distress, quantum meruit, and breach of contract all of
which . . . do not arise under the Act because she was not an employee of ASARCO.” But Natalie’s
claims, like Glenn’s, arise out of Crawford’s conduct in investigating, handling, and settling
Glenn’s claim for workers’ compensation benefits. Specifically, she complains that Crawford
breached promises to pay her to provide services to Glenn and that Crawford maliciously caused
her to be prosecuted for insurance fraud. We have held that an employee’s spouse cannot bring a
separate action alleging claims under the Act. See Rodriguez v. Naylor Indus., Inc., 763 S.W.2d
411, 412 (Tex. 1989) (recognizing that any claims compensable under the Act could not be brought
by non-employee spouse except for intentional tort claims). The only noted exception to this rule
is if a spouse is pursuing a loss of consortium claim where there is evidence that the employer’s
intentional tort caused the employee’s injury. Id. (“Therefore, Mrs. Rodriguez’ suit for loss of
consortium is barred by the Workers’ Compensation Act unless she can establish that the injury
caused her husband was intentional.”); see also Reed Tool Co. v. Copelin, 610 S.W.2d 736, 738–
39 (Tex. 1980). We conclude that, even if Natalie Johnson has standing to assert her claims, they
fall within the Division’s exclusive jurisdiction.
Having concluded that the Division has exclusive jurisdiction over the Johnsons’ claims
against Crawford, we further conclude that Crawford is entitled to mandamus relief. In re Sw. Bell
Tel. Co., L.P., 235 S.W.3d 619, 624 (Tex. 2007) (granting mandamus to require dismissal of claims
over which Public Utility Commission had exclusive jurisdiction because “[a]llowing the trial
court to proceed if the PUC has exclusive jurisdiction would disrupt the orderly processes of
government”); In re Entergy Corp., 142 S.W.3d 316, 321 (Tex. 2004) (same). Because the
Johnsons’ claims arise out of Crawford’s investigation, handling, and settling of workers’
12
compensation claims, they fall within the Division’s exclusive jurisdiction and the Act provides
the sole process and remedies for those claims. Because the Johnsons failed to exhaust their
administrative remedies under the Act prior to filing this action, the trial court lacked jurisdiction
and should have dismissed it. See City of Houston v. Rhule, 417 S.W.3d 440, 442 (Tex. 2013)
(“Absent exhaustion of administrative remedies, a trial court must dismiss the case.”).
Pursuant to Texas Rule of Appellate Procedure 52.8(c), without hearing oral arguments,
we conditionally grant mandamus relief and direct the 108th District Court to withdraw its order
denying Crawford’s plea to the jurisdiction and dismiss the Johnsons’ claims for lack of subject-
matter jurisdiction. Our writ will issue only if the court fails to act in accordance with this opinion.
Opinion Delivered: February 27, 2015
13
<>
TITLE 28 INSURANCE
PART 2 TEXAS DEPARTMENT OF INSURANCE, DIVISION OF
WORKERS' COMPENSATION
CHAPTER 43 INSURANCE COVERAGE
RULE §43.10 Termination of Coverage
(a) Definitions. The following words and terms, when used in this section, shall have the
following meanings, unless the context clearly indicates otherwise.
(1) Termination of coverage--Occurs when either party withdraws from a policy of workers'
compensation insurance, either by canceling the policy in the middle of its term, or by declining
to renew the policy on its anniversary date.
(2) Rejection of the workers' compensation system--Occurs when a subscriber terminates
coverage and fails or refuses to purchase a policy of workers' compensation insurance.
(b) Carrier's notice to the Industrial Accident Board. The carrier shall notify the board when
coverage is terminated by filing Board Form IAB-9, "Cancellation or Non-Renewal Notice."
The notice shall be:
(1) filed in person or by certified mail; and
(2) filed on or before the effective date of termination.
(c) Carrier's notice to subscriber. The carrier shall notify the subscriber when the carrier
terminates coverage. No notice is required when the subscriber terminates coverage. Notice to
the subscriber shall be:
(1) in writing;
(2) sent by certified mail; and
(3) mailed no later than the 30th day before the effective date of termination; or
(4) mailed no later than the 10th day before the effective date of termination if termination is
due to:
(A) fraud in obtaining coverage;
(B) failure to pay a premium when payment is due;
(C) an increase in the hazard for which the subscriber seeks coverage that results from an
action or omission of the subscriber and that would produce an increase in the rate; or
(D) a determination by the commissioner of insurance that coverage would be illegal or
hazardous to the interests of subscribers, creditors, or the general public.
(d) Effective date of termination of coverage.
(1) Termination by the carrier shall be effective on the latest of the following dates:
(A) on the 31st day after the carrier notifies the subscriber as provided in subsection (c) of
this section, or, if the termination is due to one of the conditions set out in subsection (c)(4) of
this section, on the 11th day after the carrier notifies the subscriber as provided in subsection (c)
of this section;
(B) the day the carrier files notice of termination with the board, as provided in subsection (b)
of this section; or
(C) the actual termination date recited on the notice.
(2) Termination by the subscriber shall be effective on the actual termination date recited on
the notice.
(3) Termination shall be deemed effective on the date a subsequent carrier files notice of
inception of coverage for the subscriber.
(e) Duties of a subscriber who terminates coverage and rejects the workers' compensation
system.
(1) A subscriber who terminates coverage and rejects the workers' compensation system shall,
on or before the effective date of termination:
(A) post copies of notice of noncoverage, on a board-prescribed form, in three places around
each work site affected; and
(B) file a copy of the notice of noncoverage with the board.
(2) Failure to comply renders the subscriber liable for statutory benefits to injured employees.
Source Note: The provisions of this §43.10 adopted to be effective December 21, 1989, 14
TexReg 6419.
<>
TITLE 28 INSURANCE
PART 2 TEXAS DEPARTMENT OF INSURANCE, DIVISION OF
WORKERS' COMPENSATION
CHAPTER 110 REQUIRED NOTICES OF COVERAGE
SUBCHAPTER A CARRIER NOTICES
RULE §110.1 Requirements for Notifying the Commission of Insurance Coverage
Historical Texas
Register
(a) An approved insurance policy, as referenced in Texas Labor Code §401.011(44)(A),
includes a binder, which serves as evidence of a temporary agreement that legally provides
workers' compensation insurance coverage until the approved insurance policy is issued or the
binder is canceled.
(b) As used in this section, "insurance coverage information" includes information regarding
whether or not an employer has workers' compensation insurance coverage and, if so,
information about the means of insurance coverage used.
(c) This rule applies to employers whose employees are not exempt from coverage under the
Workers' Compensation Act (the Act), and to insurance carriers. It does not apply to employers
whose only employees are exempt from coverage under the Act. Certified Self Insurers are also
subject to requirements specified in Chapter 114 of this title (relating to Self-Insurance).
(d) Employers and insurance carriers shall submit to the commission, or its designee, insurance
coverage information in the form and manner prescribed by the commission. The commission
may designate and contract with a data collection agency to collect and maintain insurance
coverage information.
(e) Employers who do not have workers' compensation insurance coverage are required to
provide insurance coverage information in the form of a notice of non-coverage, in accordance
with subsection (d) of this section as follows:
(1) if the employer elects not to be covered by workers' compensation insurance, the earlier of
the following:
(A) 30 days after receiving a commission request for the filing of a notice of non-coverage
and annually thereafter on the anniversary date of the original filing;
(B) 30 days after hiring an employee who is subject to coverage under the Act, and annually
thereafter on the anniversary date of the original filing;
(2) if the employer cancels coverage without purchasing a new policy or becoming a certified
self-insurer, within ten days after notifying the insurance carrier and annually thereafter on the
anniversary of the cancellation date of the workers' compensation policy; or
(3) if the employer is principally located outside of Texas, within ten days after receiving a
written request from the commission for information about the coverage status of its Texas
operations.
(f) When an employer elects to cancel coverage, the effective date of that cancellation shall be
the later of:
(1) 30 days after filing the notice of non-coverage with the commission; or
(2) the cancellation date of the policy.
(g) The workers' compensation insurance coverage shall be extended until the effective date of
withdrawal as established in subsection (f) of this section, and the employer is obligated to pay
premiums which accrue during this period.
(h) Insurance carriers are required to provide insurance coverage information for insured Texas
employers in accordance with subsection (d) of this rule as follows:
(1) within ten days after the effective date of coverage or endorsement and annually thereafter
no later than ten days after the anniversary date of coverage;
(2) 30 days prior to the date on which cancellation or non-renewal becomes effective if the
insurance carrier cancels the workers' compensation insurance coverage, does not renew the
workers' compensation insurance coverage on the anniversary date, or cancels a binder before
it issues a policy;
(3) ten days prior to the date on which the cancellation becomes effective if the insurance
carrier cancels an employer's workers' compensation coverage in accordance with Texas Labor
Code, §406.008(a)(2); or
(4) within ten days after receiving notice of the effective date of cancellation from the covered
employer because the employer switched workers' compensation insurance carriers.
(i) Workers' compensation insurance coverage remains in effect until the later of:
(1) the end of the policy period, or
(2) the date the commission and the employer receive the notification from the insurance
carrier of coverage cancellation or non-renewal and the later of:
(A) the date 30 days after receipt of the notice required by Texas Labor Code,
§406.008(a)(1);
(B) the date ten days after receipt of the notice required by Texas Labor Code,
§406.008(a)(2); or
(C) the effective date of the cancellation if later than the date in paragraphs (1) or (2) of this
subsection.
(j) "Claim administration contact" as it applies to this chapter is the person responsible for
identifying or confirming an employer's coverage information with the commission. Each
insurance carrier shall file a notice with the commission of their designated claim
administration contact not later than the 10th day after the date on which the coverage or claim
administration agreement takes effect. A single administration address for the purpose of
identifying or confirming an employer's coverage status shall be provided. If the single claims
administration contact address changes, the insurance carrier shall provide the new address to
the commission at least 30 days in advance of the change taking effect. This information shall
be filed in the form and manner prescribed by the commission.
(k) An insurance carrier may elect to have a servicing agent process and file all coverage
information, but the insurance carrier remains responsible for meeting all filing requirements of
this rule.
(l) Notwithstanding the other provisions of this section, if an employer switches workers'
compensation insurance carriers, the original policy is considered canceled as of the date the
new coverage takes effect. Employers shall notify the prior insurance carrier of the cancellation
date of the original policy, in writing, within ten days of the effective date.
Source Note: The provisions of this §110.1 adopted to be effective September 15, 1993, 18
TexReg 5884; amended to be effective March 13, 2000, 25 TexReg 2080; amended to be
effective June 5, 2003, 28 TexReg 4284
LABOR CODE
TITLE 5. WORKERS ’ COMPENSATION
SUBTITLE A. TEXAS WORKERS ’ COMPENSATION ACT
CHAPTER 401. GENERAL PROVISIONS
SUBCHAPTER A. SHORT TITLE; APPLICATION OF SUNSET ACT
Sec.A401.001.AASHORT TITLE. This subtitle may be cited as
the Texas Workers ’ Compensation Act.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A401.003.AAACTIVITIES OF THE STATE AUDITOR. (a) The
division is subject to audit by the state auditor in accordance with
Chapter 321, Government Code.AAThe state auditor may audit:
(1)AAthe structure and internal controls of the
division;
(2)AAthe level and quality of service provided by the
division to employers, injured employees, insurance carriers,
self-insured governmental entities, and other participants;
(3)AAthe implementation of statutory mandates by the
division;
(4)AAemployee turnover;
(5)AAinformation management systems, including public
access to nonconfidential information;
(6)AAthe adoption and implementation of administrative
rules by the commissioner; and
(7)AAassessment of administrative violations and the
penalties for those violations.
(b)AANothing in this section limits the authority of the
state auditor under Chapter 321, Government Code.
Added by Acts 2001, 77th Leg., ch. 1456, Sec. 7.02, eff. June 17,
2001.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.002, eff.
September 1, 2005.
SUBCHAPTER B. DEFINITIONS
1
Sec.A401.011.AAGENERAL DEFINITIONS. In this subtitle:
(1)AA"Adjuster" means a person licensed under Chapter
4101, Insurance Code.
(2)AA"Administrative violation" means a violation of
this subtitle, a rule adopted under this subtitle, or an order or
decision of the commissioner that is subject to penalties and
sanctions as provided by this subtitle.
(3)AA"Agreement" means the resolution by the parties to
a dispute under this subtitle of one or more issues regarding an
injury, death, coverage, compensability, or compensation. The term
does not include a settlement.
(4)AA"Alien" means a person who is not a citizen of the
United States.
(5)AA"Benefit" means a medical benefit, an income
benefit, a death benefit, or a burial benefit based on a compensable
injury.
(5-a)AA"Case management" means a collaborative process
of assessment, planning, facilitation, and advocacy for options and
services to meet an individual ’s health needs through communication
and application of available resources to promote quality,
cost-effective outcomes.
(6)AA"Certified self-insurer" means a private employer
granted a certificate of authority to self-insure, as authorized by
this subtitle, for the payment of compensation.
(7)AA"Child" means a son or daughter. The term includes
an adopted child or a stepchild who is a dependent of the employee.
(8)AA"Commissioner" means the commissioner of workers ’
compensation.
(9)AA"Commute" means to pay in a lump sum.
(10)AA"Compensable injury" means an injury that arises
out of and in the course and scope of employment for which
compensation is payable under this subtitle.
(11)AA"Compensation" means payment of a benefit.
(12)AA"Course and scope of employment" means an
activity of any kind or character that has to do with and originates
in the work, business, trade, or profession of the employer and that
2
is performed by an employee while engaged in or about the
furtherance of the affairs or business of the employer. The term
includes an activity conducted on the premises of the employer or at
other locations. The term does not include:
(A)AAtransportation to and from the place of
employment unless:
(i)AAthe transportation is furnished as a
part of the contract of employment or is paid for by the employer;
(ii)AAthe means of the transportation are
under the control of the employer; or
(iii)AAthe employee is directed in the
employee ’s employment to proceed from one place to another place;
or
(B)AAtravel by the employee in the furtherance of
the affairs or business of the employer if the travel is also in
furtherance of personal or private affairs of the employee unless:
(i)AAthe travel to the place of occurrence of
the injury would have been made even had there been no personal or
private affairs of the employee to be furthered by the travel; and
(ii)AAthe travel would not have been made had
there been no affairs or business of the employer to be furthered by
the travel.
(12-a)AA"Credentialing" has the meaning assigned by
Chapter 1305, Insurance Code.
(13)AA"Death benefit" means a payment made under this
subtitle to a legal beneficiary because of the death of an employee.
(13-a)AA"Department" means the Texas Department of
Insurance.
(14)AA"Dependent" means an individual who receives a
regular or recurring economic benefit that contributes
substantially to the individual ’s welfare and livelihood if the
individual is eligible for distribution of benefits under Chapter
408.
(15)AA"Designated doctor" means a doctor appointed by
mutual agreement of the parties or by the division to recommend a
resolution of a dispute as to the medical condition of an injured
employee.
3
(16)AA"Disability" means the inability because of a
compensable injury to obtain and retain employment at wages
equivalent to the preinjury wage.
(16-a)AA"Division" means the division of workers ’
compensation of the department.
(17)AA"Doctor" means a doctor of medicine, osteopathic
medicine, optometry, dentistry, podiatry, or chiropractic who is
licensed and authorized to practice.
(18)AA"Employer" means, unless otherwise specified, a
person who makes a contract of hire, employs one or more employees,
and has workers ’ compensation insurance coverage. The term
includes a governmental entity that self-insures, either
individually or collectively.
(18-a)AA"Evidence-based medicine" means the use of
current best quality scientific and medical evidence formulated
from credible scientific studies, including peer-reviewed medical
literature and other current scientifically based texts, and
treatment and practice guidelines in making decisions about the
care of individual patients.
(19)AA"Health care" includes all reasonable and
necessary medical aid, medical examinations, medical treatments,
medical diagnoses, medical evaluations, and medical services.AAThe
term does not include vocational rehabilitation.AAThe term
includes:
(A)AAmedical, surgical, chiropractic, podiatric,
optometric, dental, nursing, and physical therapy services
provided by or at the direction of a doctor;
(B)AAphysical rehabilitation services performed
by a licensed occupational therapist provided by or at the
direction of a doctor;
(C)AApsychological services prescribed by a
doctor;
(D)AAthe services of a hospital or other health
care facility;
(E)AAa prescription drug, medicine, or other
remedy; and
(F)AAa medical or surgical supply, appliance,
4
brace, artificial member, or prosthetic or orthotic device,
including the fitting of, change or repair to, or training in the
use of the appliance, brace, member, or device.
(20)AA"Health care facility" means a hospital,
emergency clinic, outpatient clinic, or other facility providing
health care.
(21)AA"Health care practitioner" means:
(A)AAan individual who is licensed to provide or
render and provides or renders health care; or
(B)AAa nonlicensed individual who provides or
renders health care under the direction or supervision of a doctor.
(22)AA"Health care provider" means a health care
facility or health care practitioner.
(22-a)AA"Health care reasonably required" means health
care that is clinically appropriate and considered effective for
the injured employee ’s injury and provided in accordance with best
practices consistent with:
(A)AAevidence-based medicine; or
(B)AAif that evidence is not available, generally
accepted standards of medical practice recognized in the medical
community.
(23)AA"Impairment" means any anatomic or functional
abnormality or loss existing after maximum medical improvement that
results from a compensable injury and is reasonably presumed to be
permanent.
(24)AA"Impairment rating" means the percentage of
permanent impairment of the whole body resulting from a compensable
injury.
(25)AA"Income benefit" means a payment made to an
employee for a compensable injury. The term does not include a
medical benefit, death benefit, or burial benefit.
(25-a)AA"Independent review organization" has the same
meaning as in Section 1305.004(a)(11), Insurance Code.
(26)AA"Injury" means damage or harm to the physical
structure of the body and a disease or infection naturally
resulting from the damage or harm. The term includes an
occupational disease.
5
(27)AA"Insurance carrier" means:
(A)AAan insurance company;
(B)AAa certified self-insurer for workers ’
compensation insurance;
(C)AAa certified self-insurance group under
Chapter 407A; or
(D)AAa governmental entity that self-insures,
either individually or collectively.
(28)AA"Insurance company" means a person authorized and
admitted by the Texas Department of Insurance to do insurance
business in this state under a certificate of authority that
includes authorization to write workers ’ compensation insurance.
(29)AA"Legal beneficiary" means a person entitled to
receive a death benefit under this subtitle.
(30)AA"Maximum medical improvement" means the earlier
of:
(A)AAthe earliest date after which, based on
reasonable medical probability, further material recovery from or
lasting improvement to an injury can no longer reasonably be
anticipated;
(B)AAthe expiration of 104 weeks from the date on
which income benefits begin to accrue; or
(C)AAthe date determined as provided by Section
408.104.
(31)AA"Medical benefit" means payment for health care
reasonably required by the nature of a compensable injury and
intended to:
(A)AAcure or relieve the effects naturally
resulting from the compensable injury, including reasonable
expenses incurred by the employee for necessary treatment to cure
and relieve the employee from the effects of an occupational
disease before and after the employee knew or should have known the
nature of the disability and its relationship to the employment;
(B)AApromote recovery; or
(C)AAenhance the ability of the employee to return
to or retain employment.
(31-a)AA"Network" or "workers ’ compensation health care
6
network" means an organization that is:
(A)AAformed as a health care provider network to
provide health care services to injured employees;
(B)AAcertified in accordance with Chapter 1305,
Insurance Code, and rules of the commissioner of insurance; and
(C)AAestablished by, or operates under contract
with, an insurance carrier.
(32)AA"Objective" means independently verifiable or
confirmable results that are based on recognized laboratory or
diagnostic tests, or signs confirmable by physical examination.
(33)AA"Objective clinical or laboratory finding" means
a medical finding of impairment resulting from a compensable
injury, based on competent objective medical evidence, that is
independently confirmable by a doctor, including a designated
doctor, without reliance on the subjective symptoms perceived by
the employee.
(34)AA"Occupational disease" means a disease arising
out of and in the course of employment that causes damage or harm to
the physical structure of the body, including a repetitive trauma
injury. The term includes a disease or infection that naturally
results from the work-related disease. The term does not include an
ordinary disease of life to which the general public is exposed
outside of employment, unless that disease is an incident to a
compensable injury or occupational disease.
(34-a)AA"Orthotic device" means a custom-fitted or
custom-fabricated medical device that is applied to a part of the
human body to correct a deformity, improve function, or relieve
symptoms related to a compensable injury or occupational disease.
(35)AA"Penalty" means a fine established by this
subtitle.
(35-a)AA"Prosthetic device" means an artificial device
designed to replace, wholly or partly, an arm or leg.
(36)AA"Repetitive trauma injury" means damage or harm
to the physical structure of the body occurring as the result of
repetitious, physically traumatic activities that occur over time
and arise out of and in the course and scope of employment.
(37)AA"Representative" means a person, including an
7
attorney, authorized by the commissioner to assist or represent an
employee, a person claiming a death benefit, or an insurance
carrier in a matter arising under this subtitle that relates to the
payment of compensation.
(38)AA"Research center" means the research functions of
the Texas Department of Insurance required under Chapter 405.
(38-a)AA"Retrospective review" means the utilization
review process of reviewing the medical necessity and
reasonableness of health care that has been provided to an injured
employee.
(39)AA"Sanction" means a penalty or other punitive
action or remedy imposed by the commissioner on an insurance
carrier, representative, employee, employer, or health care
provider for an act or omission in violation of this subtitle or a
rule, order, or decision of the commissioner.
(40)AA"Settlement" means a final resolution of all the
issues in a workers ’ compensation claim that are permitted to be
resolved under the terms of this subtitle.
(41)AA"Subjective" means perceivable only by an
employee and not independently verifiable or confirmable by
recognized laboratory or diagnostic tests or signs observable by
physical examination.
(42)AA"Treating doctor" means the doctor who is
primarily responsible for the employee ’s health care for an injury.
(42-a)AA"Utilization review" has the meaning assigned
by Chapter 4201, Insurance Code.
(42-b)AA"Utilization review agent" has the meaning
assigned by Chapter 4201, Insurance Code.
(42-c)AA"Violation" means an administrative violation
subject to penalties and sanctions as provided by this subtitle.
(43)AA"Wages" includes all forms of remuneration
payable for a given period to an employee for personal services.
The term includes the market value of board, lodging, laundry,
fuel, and any other advantage that can be estimated in money that
the employee receives from the employer as part of the employee ’s
remuneration.
(44)AA"Workers ’ compensation insurance coverage"
8
means:
(A)AAan approved insurance policy to secure the
payment of compensation;
(B)AAcoverage to secure the payment of
compensation through self-insurance as provided by this subtitle;
or
(C)AAcoverage provided by a governmental entity to
secure the payment of compensation.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1997, 75th Leg., ch. 1443, Sec. 1, eff. Sept. 1, 1997; Acts
2003, 78th Leg., ch. 275, Sec. 2, eff. Sept. 1, 2003.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.003, eff.
September 1, 2005.
Acts 2007, 80th Leg., R.S., Ch. 133 (H.B. 1003), Sec. 1, eff.
September 1, 2007.
Acts 2007, 80th Leg., R.S., Ch. 134 (H.B. 1006), Sec. 1, eff.
September 1, 2007.
Acts 2007, 80th Leg., R.S., Ch. 147 (S.B. 458), Sec. 1, eff.
September 1, 2007.
Acts 2009, 81st Leg., R.S., Ch. 1330 (H.B. 4290), Sec. 13,
eff. September 1, 2009.
Sec.A401.012.AADEFINITION OF EMPLOYEE. (a) In this
subtitle, "employee" means each person in the service of another
under a contract of hire, whether express or implied, or oral or
written.
(b)AAThe term "employee" includes:
(1)AAan employee employed in the usual course and scope
of the employer ’s business who is directed by the employer
temporarily to perform services outside the usual course and scope
of the employer ’s business;
(2)AAa person, other than an independent contractor or
the employee of an independent contractor, who is engaged in
construction, remodeling, or repair work for the employer at the
premises of the employer; and
(3)AAa person who is a trainee under the Texans Work
9
program established under Chapter 308.
(c)AAThe term "employee" does not include:
(1)AAa master of or a seaman on a vessel engaged in
interstate or foreign commerce; or
(2)AAa person whose employment is not in the usual
course and scope of the employer ’s business.
(d)AAA person who is an employee for the purposes of this
subtitle and engaged in work that otherwise may be legally
performed is an employee despite:
(1)AAa license, permit, or certificate violation
arising under state law or municipal ordinance; or
(2)AAa violation of a law regulating wages, hours, or
work on Sunday.
(e)AAThis section may not be construed to relieve from fine
or imprisonment any individual, firm, or corporation employing or
performing work or a service prohibited by a statute of this state
or a municipal ordinance.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1997, 75th Leg., ch. 456, Sec. 6, eff. Sept. 1, 1997.
Sec.A401.013.AADEFINITION OF INTOXICATION. (a) In this
subtitle, "intoxication" means the state of:
(1)AAhaving an alcohol concentration to qualify as
intoxicated under Section 49.01(2), Penal Code; or
(2)AAnot having the normal use of mental or physical
faculties resulting from the voluntary introduction into the body
of:
(A)AAan alcoholic beverage, as defined by Section
1.04, Alcoholic Beverage Code;
(B)AAa controlled substance or controlled
substance analogue, as defined by Section 481.002, Health and
Safety Code;
(C)AAa dangerous drug, as defined by Section
483.001, Health and Safety Code;
(D)AAan abusable glue or aerosol paint, as defined
by Section 485.001, Health and Safety Code; or
(E)AAany similar substance, the use of which is
10
regulated under state law.
(b)AAThe term "intoxication" does not include the loss of
normal use of mental or physical faculties resulting from the
introduction into the body of a substance:
(1)AAtaken under and in accordance with a prescription
written for the employee by the employee ’s doctor; or
(2)AAlisted under Subsection (a) by inhalation or
absorption incidental to the employee ’s work.
(c)AAOn the voluntary introduction into the body of any
substance listed under Subsection (a)(2)(B), based on a blood test
or urinalysis, it is a rebuttable presumption that a person is
intoxicated and does not have the normal use of mental or physical
faculties.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1995, 74th Leg., ch. 76, Sec. 14.48, eff. Sept. 1, 1995;
Acts 1999, 76th Leg., ch. 1426, Sec. 1, eff. Sept. 1, 1999.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.004, eff.
September 1, 2005.
SUBCHAPTER C. MISCELLANEOUS PROVISIONS
Sec. 401.021.AAAPPLICATION OF OTHER ACTS. Except as
otherwise provided by this subtitle:
(1)AAa proceeding, hearing, judicial review, or
enforcement of a commissioner order, decision, or rule is governed
by the following subchapters and sections of Chapter 2001,
Government Code:
(A)AASubchapters A, B, D, E, G, and H, excluding
Sections 2001.004(3) and 2001.005;
(B)AASections 2001.051, 2001.052, and 2001.053;
(C)AASections 2001.056 through 2001.062; and
(D)AASection 2001.141(c);
(2)AAa proceeding, hearing, judicial review, or
enforcement of a commissioner order, decision, or rule is governed
by Subchapters A and B, Chapter 2002, Government Code, excluding
Sections 2002.001(3) and 2002.023;
11
(3)AAChapter 551, Government Code, applies to a
proceeding under this subtitle, other than:
(A)AAa benefit review conference;
(B)AAa contested case hearing;
(C)AAa proceeding of the appeals panel;
(D)AAarbitration; or
(E)AAanother proceeding involving a determination
on a workers ’ compensation claim; and
(4)AAChapter 552, Government Code, applies to a
workers ’ compensation record of the division, the department, or
the office of injured employee counsel.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1995, 74th Leg., ch. 76, Sec. 5.92, 5.95(82), (88), eff.
Sept. 1, 1995.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.005, eff.
September 1, 2005.
Sec.A401.022.AADISCRIMINATION PROHIBITED. (a) This
subtitle may not be applied to discriminate because of race, sex,
national origin, or religion.
(b)AAThis section does not prohibit consideration of an
anatomical difference in application of the impairment guidelines
under Chapter 408 in rating an injury or a disease such as, but not
limited to, breast cancer or an inguinal hernia. If an impairment
rating assigns different values to the same injury for males and
females, the higher value shall be applied.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A401.023.AAINTEREST OR DISCOUNT RATE. (a) Interest or a
discount under this subtitle shall be computed at the rate provided
by this section.
(b)AAThe division shall compute and publish the interest and
discount rate quarterly, using the treasury constant maturity rate
for one-year treasury bills issued by the United States government,
as published by the Federal Reserve Board on the 15th day preceding
the first day of the calendar quarter for which the rate is to be
12
effective, plus 3.5 percent.AAFor this purpose, calendar quarters
begin January 1, April 1, July 1, and October 1.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1999, 76th Leg., ch. 1426, Sec. 2, eff. Oct. 1, 1999; Acts
2001, 77th Leg., ch. 1456, Sec. 15.01, eff. June 17, 2001.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.006, eff.
September 1, 2005.
Sec.A401.024.AATRANSMISSION OF INFORMATION. (a) In this
section, "electronic transmission" means the transmission of
information by facsimile, electronic mail, electronic data
interchange, or any other similar method.
(b)AANotwithstanding another provision of this subtitle that
specifies the form, manner, or procedure for the transmission of
specified information, the commissioner by rule may permit or
require the use of an electronic transmission instead of the
specified form, manner, or procedure.AAIf the electronic
transmission of information is not authorized or permitted by rule,
the transmission of that information is governed by any applicable
statute or rule that prescribes the form, manner, or procedure for
the transmission, including standards adopted by the Department of
Information Resources.
(c)AAThe commissioner may designate and contract with one or
more data collection agents to fulfill the data collection
requirements of this subtitle.AATo qualify as a data collection
agent, an organization must demonstrate at least five years of
experience in data collection, data maintenance, data quality
control, accounting, and related areas.
(d)AAThe commissioner may prescribe the form, manner, and
procedure for transmitting any authorized or required electronic
transmission, including requirements related to security,
confidentiality, accuracy, and accountability.
(e)AAA data collection agent may collect from a reporting
insurance carrier, other than a governmental entity, any fees
necessary for the agent to recover the necessary and reasonable
costs of collecting data from that reporting insurance carrier.
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(f)AAA reporting insurance carrier, other than a
governmental entity, shall pay the fee to the data collection agent
for the data collection services provided by the data collection
agent.
(g)AAThe commissioner may adopt rules necessary to implement
this section.
Added by Acts 1999, 76th Leg., ch. 954, Sec. 1, eff. Sept. 1, 1999.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.007, eff.
September 1, 2005.
Acts 2011, 82nd Leg., R.S., Ch. 410 (S.B. 800), Sec. 1, eff.
June 17, 2011.
Sec. 401.025.AAREFERENCES TO COMMISSION AND EXECUTIVE
DIRECTOR. (a) A reference in this code or other law to the Texas
Workers ’ Compensation Commission or the executive director of that
commission means the division or the commissioner as consistent
with the respective duties of the commissioner and the division
under this code and other workers ’ compensation laws of this state.
(b)AAA reference in this code or other law to the executive
director of the Texas Workers ’ Compensation Commission means the
commissioner.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.008, eff.
September 1, 2005.
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LABOR CODE
TITLE 5. WORKERS ’ COMPENSATION
SUBTITLE A. TEXAS WORKERS ’ COMPENSATION ACT
CHAPTER 402. OPERATION AND ADMINISTRATION OF WORKERS ’ COMPENSATION
SYSTEM
SUBCHAPTER A. GENERAL ADMINISTRATION OF SYSTEM; WORKERS ’
COMPENSATION DIVISION
Sec. 402.001.AAADMINISTRATION OF SYSTEM:AATEXAS DEPARTMENT
OF INSURANCE; WORKERS ’ COMPENSATION DIVISION. (a) Except as
provided by Section 402.002, the Texas Department of Insurance is
the state agency designated to oversee the workers ’ compensation
system of this state.AA
(b)AAThe division of workers ’ compensation is established as
a division within the Texas Department of Insurance to administer
and operate the workers ’ compensation system of this state as
provided by this title.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1995, 74th Leg., ch. 980, Sec. 1.02, eff. Sept. 1, 1995.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 1.003, eff.
September 1, 2005.
Sec. 402.00111.AARELATIONSHIP BETWEEN COMMISSIONER OF
INSURANCE AND COMMISSIONER OF WORKERS ’ COMPENSATION; SEPARATION OF
AUTHORITY; RULEMAKING. (a) The division is administered by the
commissioner of workers ’ compensation as provided by this
subchapter.AAExcept as otherwise provided by this title, the
commissioner of workers ’ compensation shall exercise all executive
authority, including rulemaking authority, under this title.
(b)AAThe commissioner of insurance may delegate to the
commissioner of workers ’ compensation or to that person ’s designee
and may redact any delegation, and the commissioner of workers ’
compensation may delegate to the commissioner of insurance or to
that person ’s designee, any power or duty regarding workers ’
compensation imposed on the commissioner of insurance or the
1
commissioner of workers ’ compensation under this title, including
the authority to make final orders or decisions.AAA delegation made
under this subsection must be made in writing.
(c)AAThe commissioner of insurance shall develop and
implement policies that clearly separate the respective
responsibilities of the department and the division.
(d)AAThe commissioner of insurance may provide advice,
research, and comment regarding the adoption of rules by the
commissioner of workers ’ compensation under this subtitle.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 1.004, eff.
September 1, 2005.
Sec. 402.00112.AAINVESTIGATION OF DIVISION. The department
shall investigate the conduct of the work of the division.AAFor
that purpose, the department shall have access at any time to all
division books and records and may require an officer or employee of
the division to furnish written or oral information.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 1.004, eff.
September 1, 2005.
Sec. 402.00113.AAADMINISTRATIVE ATTACHMENT TO DEPARTMENT.
(a) The division of workers ’ compensation is administratively
attached to the department.
(b)AAThe department shall provide the staff and facilities
necessary to enable the division to perform the duties of the
division under this title, including:
(1)AAadministrative assistance and services to the
division, including budget planning and purchasing;
(2)AApersonnel and financial services; and
(3)AAcomputer equipment and support.
(c)AAThe commissioner of workers ’ compensation and the
commissioner of insurance may enter into agreements as necessary to
implement this title.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 1.004, eff.
September 1, 2005.
Sec. 402.00114.AADUTIES OF DIVISION; SINGLE POINT OF
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CONTACT. (a) In addition to other duties required under this
title, the division shall:
(1)AAregulate and administer the business of workers ’
compensation in this state; and
(2)AAensure that this title and other laws regarding
workers ’ compensation are executed.
(b)AATo the extent determined feasible by the commissioner,
the division shall establish a single point of contact for injured
employees receiving services from the division.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 1.004, eff.
September 1, 2005.
Sec. 402.00115.AACOMPOSITION OF DIVISION. The division is
composed of the commissioner of workers ’ compensation and other
officers and employees as required to efficiently implement:
(1)AAthis title;
(2)AAother workers ’ compensation laws of this state;
and
(3)AAother laws granting jurisdiction or applicable to
the division or the commissioner.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 1.004, eff.
September 1, 2005.
Sec. 402.00116.AACHIEF EXECUTIVE. (a) The commissioner of
workers ’ compensation is the division ’s chief executive and
administrative officer.AAThe commissioner shall administer and
enforce this title, other workers ’ compensation laws of this state,
and other laws granting jurisdiction to or applicable to the
division or the commissioner.AAExcept as otherwise specifically
provided by this title, a reference in this title to the
"commissioner" means the commissioner of workers ’ compensation.
(b)AAThe commissioner has the powers and duties vested in the
division by this title and other workers ’ compensation laws of this
state.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 1.004, eff.
September 1, 2005.
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Sec. 402.00117.AAAPPOINTMENT; TERM. (a) The governor, with
the advice and consent of the senate, shall appoint the
commissioner.AAThe commissioner serves a two-year term that
expires on February 1 of each odd-numbered year.
(b)AAThe governor shall appoint the commissioner without
regard to the race, color, disability, sex, religion, age, or
national origin of the appointee.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 1.004, eff.
September 1, 2005.
Sec. 402.00118.AAQUALIFICATIONS. The commissioner must:
(1)AAbe a competent and experienced administrator;
(2)AAbe well-informed and qualified in the field of
workers ’ compensation; and
(3)AAhave at least five years of experience as an
executive in the administration of business or government or as a
practicing attorney, physician, or certified public accountant.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 1.004, eff.
September 1, 2005.
Sec. 402.00119.AAINELIGIBILITY FOR PUBLIC OFFICE. The
commissioner is ineligible to be a candidate for a public elective
office in this state unless the commissioner has resigned and the
governor has accepted the resignation.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 1.004, eff.
September 1, 2005.
Sec. 402.00120.AACOMPENSATION. The commissioner is entitled
to compensation as provided by the General Appropriations Act.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 1.004, eff.
September 1, 2005.
Sec. 402.00121.AAGROUNDS FOR REMOVAL. (a) It is a ground for
removal from office that the commissioner:
(1)AAdoes not have at the time of appointment the
qualifications required by Section 402.00118;
(2)AAdoes not maintain during service as commissioner
4
the qualifications required by Section 402.00118;
(3)AAviolates a prohibition established by Section
402.00122, 402.00124, 402.00125, or 402.00126; or
(4)AAcannot because of illness or incapacity discharge
the commissioner ’s duties for a substantial part of the
commissioner ’s term.
(b)AAThe validity of an action of the commissioner or the
division is not affected by the fact that it is taken when a ground
for removal of the commissioner exists.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 1.004, eff.
September 1, 2005.
Sec. 402.00122.AAPROHIBITED GIFTS; ADMINISTRATIVE
VIOLATION. (a) The commissioner or an employee of the division may
not accept a gift, a gratuity, or entertainment from a person having
an interest in a matter or proceeding pending before the division.
(b)AAA violation of Subsection (a) is an administrative
violation and constitutes a ground for removal from office or
termination of employment.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 1.004, eff.
September 1, 2005.
Sec. 402.00123.AACIVIL LIABILITY OF COMMISSIONER. The
commissioner is not liable in a civil action for an act performed in
good faith in the execution of duties as commissioner.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 1.004, eff.
September 1, 2005.
Sec. 402.00124.AACONFLICT OF INTEREST. (a) In this section,
"Texas trade association" means a cooperative and voluntarily
joined statewide association of business or professional
competitors in this state designed to assist its members and its
industry or profession in dealing with mutual business or
professional problems and in promoting their common interest.
(b)AAA person may not be the commissioner and may not be a
division employee employed in a "bona fide executive,
administrative, or professional capacity" as that phrase is used
5
for purposes of establishing an exemption to the overtime
provisions of the federal Fair Labor Standards Act of 1938 (29
U.S.C. Section 201 et seq.) if:
(1)AAthe person is an officer, employee, or paid
consultant of a Texas trade association in the field of workers ’
compensation; or
(2)AAthe person ’s spouse is an officer, manager, or paid
consultant of a Texas trade association in the field of workers ’
compensation.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 1.004, eff.
September 1, 2005.
Sec. 402.00125.AAPROHIBITION ON CERTAIN EMPLOYMENT OR
REPRESENTATION. (a) A former commissioner or former employee of
the division involved in hearing cases under this title may not:
(1)AAbe employed by an insurance carrier that was
subject to the scope of the commissioner ’s or employee ’s official
responsibility while the commissioner or employee was associated
with the division; or
(2)AArepresent a person before the division or a court
in a matter:
(A)AAin which the commissioner or employee was
personally involved while associated with the division; or
(B)AAthat was within the commissioner ’s or
employee ’s official responsibilities while the commissioner or
employee was associated with the division.
(b)AAThe prohibition under Subsection (a)(1) applies until
the:
(1)AAsecond anniversary of the date the commissioner
ceases to serve as the commissioner; and
(2)AAfirst anniversary of the date the employee ’s
employment with the division ceases.
(c)AAThe prohibition under Subsection (a)(2) applies to a
current commissioner or employee of the division while the
commissioner or employee is involved in hearing cases under this
title and at any time thereafter.
(d)AAA person commits an offense if the person violates this
6
section.AAAn offense under this section is a Class A misdemeanor.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 1.004, eff.
September 1, 2005.
Sec. 402.00126.AALOBBYING ACTIVITIES. A person may not serve
as commissioner or act as general counsel to the commissioner if the
person is required to register as a lobbyist under Chapter 305,
Government Code, because of the person ’s activities for
compensation related to the operation of the department or the
division.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 1.004, eff.
September 1, 2005.
Sec. 402.00127.AATRAINING PROGRAM FOR COMMISSIONER. (a)
NotAAlater than the 90th day after the date on which the
commissioner takes office, the commissioner shall complete a
training program that complies with this section.
(b)AAThe training program must provide the commissioner with
information regarding:
(1)AAthe legislation that created the division;
(2)AAthe programs operated by the division;
(3)AAthe role and functions of the division;
(4)AAthe rules of the commissioner of insurance
relating to the division, with an emphasis on the rules that relate
to disciplinary and investigatory authority;
(5)AAthe current budget for the division;
(6)AAthe results of the most recent formal audit of the
division;
(7)AAthe requirements of:
(A)AAthe open meetings law, Chapter 551,
Government Code;
(B)AAthe public information law, Chapter 552,
Government Code;
(C)AAthe administrative procedure law, Chapter
2001, Government Code; and
(D)AAother laws relating to public officials,
including conflict-of-interest laws; and
7
(8)AAany applicable ethics policies adopted by the
division or the Texas Ethics Commission.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 1.004, eff.
September 1, 2005.
Sec. 402.00128.AAGENERAL POWERS AND DUTIES OF COMMISSIONER.
(a) The commissioner shall conduct the daily operations of the
division and otherwise implement division policy.
(b)AAThe commissioner or the commissioner ’s designee may:
(1)AAinvestigate misconduct;
(2)AAhold hearings;
(3)AAissue subpoenas to compel the attendance of
witnesses and the production of documents;
(4)AAadminister oaths;
(5)AAtake testimony directly or by deposition or
interrogatory;
(6)AAassess and enforce penalties established under
this title;
(7)AAenter appropriate orders as authorized by this
title;
(8)AAinstitute an action in the division ’s name to
enjoin the violation of this title;
(9)AAinitiate an action under Section 410.254 to
intervene in a judicial proceeding;
(10)AAprescribe the form, manner, and procedure for the
transmission of information to the division;
(11)AAcorrect clerical errors in the entry of orders;
and
(12)AAexercise other powers and perform other duties as
necessary to implement and enforce this title.
(c)AAThe commissioner is the agent for service of process on
out-of-state employers.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 1.004, eff.
September 1, 2005.
Sec. 402.002.AAADMINISTRATION OF SYSTEM:AAOFFICE OF INJURED
EMPLOYEE COUNSEL. The office of injured employee counsel
8
established under Chapter 404 shall perform the functions regarding
the provision of workers ’ compensation benefits in this state
designated by this subtitle as under the authority of that office.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 2003, 78th Leg., ch. 1170, Sec. 47.01, eff. Sept. 1, 2003.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 1.005, eff.
September 1, 2005.
SUBCHAPTER B. SYSTEM GOALS; GENERAL ADMINISTRATION OF SYSTEM
Sec. 402.021.AAGOALS; LEGISLATIVE INTENT; GENERAL WORKERS ’
COMPENSATION MISSION OF DEPARTMENT. (a) The basic goals of the
workers ’ compensation system of this state are as follows:
(1)AAeach employee shall be treated with dignity and
respect when injured on the job;
(2)AAeach injured employee shall have access to a fair
and accessible dispute resolution process;
(3)AAeach injured employee shall have access to prompt,
high-quality medical care within the framework established by this
subtitle; and
(4)AAeach injured employee shall receive services to
facilitate the employee ’s return to employment as soon as it is
considered safe and appropriate by the employee ’s health care
provider.
(b)AAIt is the intent of the legislature that, in
implementing the goals described by Subsection (a), the workers ’
compensation system of this state must:
(1)AApromote safe and healthy workplaces through
appropriate incentives, education, and other actions;
(2)AAencourage the safe and timely return of injured
employees to productive roles in the workplace;
(3)AAprovide appropriate income benefits and medical
benefits in a manner that is timely and cost-effective;
(4)AAprovide timely, appropriate, and high-quality
medical care supporting restoration of the injured employee ’s
physical condition and earning capacity;
9
(5)AAminimize the likelihood of disputes and resolve
them promptly and fairly when identified;
(6)AApromote compliance with this subtitle and rules
adopted under this subtitle through performance-based incentives;
(7)AApromptly detect and appropriately address acts or
practices of noncompliance with this subtitle and rules adopted
under this subtitle;
(8)AAeffectively educate and clearly inform each person
who participates in the system as a claimant, employer, insurance
carrier, health care provider, or other participant of the person ’s
rights and responsibilities under the system and how to
appropriately interact within the system; and
(9)AAtake maximum advantage of technological advances
to provide the highest levels of service possible to system
participants and to promote communication among system
participants.
(c)AAThis section may not be construed as:
(1)AAcreating a cause of action; or
(2)AAestablishing an entitlement to benefits to which a
claimant is not otherwise entitled by this subtitle.
(d)AAAs provided by this subtitle, the division shall work to
promote and help ensure the safe and timely return of injured
employees to productive roles in the workforce.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1997, 75th Leg., ch. 1098, Sec. 7, eff. Sept. 1, 1997.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 1.0065, eff.
September 1, 2005.
Sec. 402.0215.AAREFERENCE TO COMMISSION DIVISIONS. A
reference in this title or any other law to the division of workers ’
health and safety, the division of medical review, the division of
compliance and practices, the division of hearings, and the
division of self-insurance regulation of the former Texas Workers ’
Compensation Commission means the division of workers ’
compensation of the Texas Department of Insurance.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 2.001, eff.
10
September 1, 2005.
Sec. 402.022.AAPUBLIC INTEREST INFORMATION. (a) The
commissioner shall prepare information of public interest
describing the functions of the division and the procedures by
which complaints are filed with and resolved by the division.
(b)AAThe commissioner shall make the information available
to the public and appropriate state agencies.
(c)AAThe commissioner by rule shall ensure that each division
form, standard letter, and brochure under this subtitle:
(1)AAis written in plain language;
(2)AAis in a readable and understandable format; and
(3)AAcomplies with all applicable requirements
relating to minimum readability requirements.
(d)AAThe division shall make informational materials
described by this section available in English and Spanish.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 2.002, eff.
September 1, 2005.
Sec.AA402.023.AACOMPLAINT INFORMATION. (a) The
commissioner shall:
(1)AAadopt rules regarding the filing of a complaint
under this subtitle against an individual or entity subject to
regulation under this subtitle; and
(2)AAensure that information regarding the complaint
process is available on the division ’sAAInternet website.
(b)AAThe rules adopted under this section must, at a minimum:
(1)AAensure that the division clearly defines in rule
the method for filing a complaint; and
(2)AAdefine what constitutes a frivolous complaint
under this subtitle.
(c)AAThe division shall develop and post on the division ’s
Internet website:
(1)AAa simple standardized form for filing complaints
under this subtitle; and
11
(2)AAinformation regarding the complaint filing
process.
(c-1)AAThe division shall adopt a policy outlining the
division ’s complaint process from receipt of the initial complaint
to the complaint ’s disposition.
(d)AAThe division shall keep an information file about each
written complaint filed with the division under this subtitle that
is unrelated to a specific workers ’ compensation claim, including a
complaint regarding the administration of the workers ’
compensation system.AAThe information must include:
(1)AAthe date the complaint is received;
(2)AAthe name of the complainant;
(3)AAthe subject matter of the complaint;
(4)AAa record of all persons contacted in relation to
the complaint;
(5)AAa summary of the results of the review or
investigation of the complaint; and
(6)AAfor complaints for which the division took no
action, an explanation of the reason the complaint was closed
without action.
(e)AAFor each written complaint that is unrelated to a
specific workers ’ compensation claim that the division has
authority to resolve, the division shall provide to the person
filing the complaint and the person about whom the complaint is made
information about the division ’s policies and procedures under this
subtitle relating to complaint investigation and resolution.AAThe
division, at least quarterly and until final disposition of the
complaint, shall notify those persons about the status of the
complaint unless the notice would jeopardize an undercover
investigation.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1995, 74th Leg., ch. 980, Sec. 1.08, eff. Sept. 1, 1995.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 2.003, eff.
September 1, 2005.
Acts 2011, 82nd Leg., R.S., Ch. 1162 (H.B. 2605), Sec. 6, eff.
September 1, 2011.
12
Sec. 402.0231.AADOCUMENTATION AND ANALYSIS OF COMPLAINTS.
(a)AAThe division shall develop procedures to formally document and
analyze complaints received by the division.
(b)AAThe division shall compile detailed statistics on all
complaints received and analyze complaint information trends,
including:
(1)AAthe number of complaints;
(2)AAthe source of each complaint;
(3)AAthe types of complaints;
(4)AAthe length of time from the receipt of the
complaint to its disposition; and
(5)AAthe disposition of complaints.
(c)AAThe division shall further analyze the information
compiled under Subsection (b) by field office and by program.
(d)AAThe division shall report the information compiled and
analyzed under Subsections (b) and (c) to the commissioner at
regular intervals.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1162 (H.B. 2605), Sec. 7,
eff. September 1, 2011.
Sec. 402.0235.AAPRIORITIES FOR COMPLAINT INVESTIGATIONS.
(a) The division shall assign priorities to complaint
investigations under this subtitle based on risk.AAIn developing
priorities under this section, the division shall develop a formal,
risk-based complaint investigation system that considers:
(1)AAthe severity of the alleged violation;
(2)AAwhether the alleged violator showed continued or
wilful noncompliance; and
(3)AAwhether a commissioner order has been violated.
(b)AAThe commissioner may develop additional risk-based
criteria as determined necessary.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 2.003, eff.
September 1, 2005.
Sec. 402.024.AAPUBLIC PARTICIPATION. (a) The commissioner
shall develop and implement policies that provide the public with a
13
reasonable opportunity to appear before the division and to speak
on issues under the general jurisdiction of the division.
(b)AAThe division shall comply with federal and state laws
related to program and facility accessibility.
(c)AAIn addition to compliance with Subsection (a), the
commissioner shall prepare and maintain a written plan that
describes how a person who does not speak English may be provided
reasonable access to the division ’s programs and services.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1995, 74th Leg., ch. 980, Sec. 1.09, eff. Sept. 1, 1995.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 2.004, eff.
September 1, 2005.
SUBCHAPTER C. PERSONNEL
Sec. 402.041.AAAPPOINTMENTS. (a) Subject to the General
Appropriations Act or other law, the commissioner shall appoint
deputies, assistants, and other personnel as necessary to carry out
the powers and duties of the commissioner and the division under
this title, other workers ’ compensation laws of this state, and
other laws granting jurisdiction or applicable to the division or
the commissioner.
(b)AAA person appointed under this section must have the
professional, administrative, and workers ’ compensation experience
necessary to qualify the person for the position to which the person
is appointed.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1995, 74th Leg., ch. 980, Sec. 1.10, eff. Sept. 1, 1995.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 1.007, eff.
September 1, 2005.
Sec. 402.042.AADIVISION OF RESPONSIBILITIES. The
commissioner shall develop and implement policies that clearly
define the respective responsibilities of the commissioner and the
staff of the division.
14
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 1.007, eff.
September 1, 2005.
Sec. 402.043.AACAREER LADDER; ANNUAL PERFORMANCE
EVALUATIONS. (a) The commissioner or the commissioner ’s designee
shall develop an intra-agency career ladder program that addresses
opportunities for mobility and advancement for employees within the
division.AAThe program shall require intra-agency postings of all
positions concurrently with any public posting.
(b)AAThe commissioner or the commissioner ’s designee shall
develop a system of annual performance evaluations that are based
on documented employee performance.AAAll merit pay for division
employees must be based on the system established under this
subsection.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 1.007, eff.
September 1, 2005.
Sec. 402.044.AAEQUAL EMPLOYMENT OPPORTUNITY POLICY
STATEMENT. (a) The commissioner or the commissioner ’s designee
shall prepare and maintain a written policy statement to ensure
implementation of a program of equal employment opportunity under
which all personnel transactions are made without regard to race,
color, disability, sex, religion, age, or national origin.AAThe
policy statement must include:
(1)AApersonnel policies, including policies related to
recruitment, evaluation, selection, appointment, training, and
promotion of personnel that are in compliance with the requirements
of Chapter 21;
(2)AAa comprehensive analysis of the division work
force that meets federal and state guidelines;
(3)AAprocedures by which a determination can be made of
significant underuse in the division work force of all persons for
whom federal or state guidelines encourage a more equitable
15
balance; and
(4)AAreasonable methods to appropriately address those
areas of underuse.
(b)AAA policy statement prepared under this section must:
(1)AAcover an annual period;
(2)AAbe updated annually;
(3)AAbe reviewed by the civil rights division of the
Texas Workforce Commission for compliance with Subsection (a)(1);
and
(4)AAbe filed with the Texas Workforce Commission.
(c)AAThe Texas Workforce Commission shall deliver a biennial
report to the legislature based on the information received under
Subsection (b).AAThe report may be made separately or as part of
other biennial reports made to the legislature.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1995, 74th Leg., ch. 980, Sec. 1.11, eff. Sept. 1, 1995.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 1.007, eff.
September 1, 2005.
SUBCHAPTER D. GENERAL POWERS AND DUTIES OF DIVISION AND
COMMISSIONER
Sec. 402.061.AAADOPTION OF RULES. The commissioner shall
adopt rules as necessary for the implementation and enforcement of
this subtitle.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 2.006, eff.
September 1, 2005.
Sec.A402.062.AAACCEPTANCE OF GIFTS, GRANTS, AND DONATIONS.
(a) The division may accept gifts, grants, or donations as provided
by rules adopted by the commissioner.
(b)AARepealed by Acts 2005, 79th Leg., Ch. 265, Sec.
7.01(15), eff. September 1, 2005.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
16
by Acts 1999, 76th Leg., ch. 1426, Sec. 4, eff. Sept. 1, 1999; Acts
2001, 77th Leg., ch. 1195, Sec. 2.08, eff. Sept. 1, 2001.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 2.007, eff.
September 1, 2005.
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 7.01(15), eff.
September 1, 2005.
Sec. 402.064.AAFEES. In addition to fees established by this
subtitle, the commissioner shall set reasonable fees for services
provided to persons requesting services from the division,
including services provided under Subchapter E.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 2.008, eff.
September 1, 2005.
Sec. 402.065.AAEMPLOYMENT OF COUNSEL. Notwithstanding
Article 1.09-1, Insurance Code, or any other law, the commissioner
may employ counsel to represent the division in any legal action the
division is authorized to initiate.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 2.009, eff.
September 1, 2005.
Sec. 402.066.AARECOMMENDATIONS TO LEGISLATURE. (a) The
commissioner shall consider and recommend to the legislature
changes to this subtitle, including any statutory changes required
by an evaluation conducted under Section 402.074.
(b)AAThe commissioner shall forward the recommended changes
to the legislature not later than December 1 of each even-numbered
year.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 2.010, eff.
September 1, 2005.
17
Sec. 402.0665.AALEGISLATIVE OVERSIGHT. The legislature may
adopt requirements relating to legislative oversight of the
division and the workers ’ compensation system of this state.AAThe
division shall comply with any requirements adopted by the
legislature under this section.
Added by Acts 1995, 74th Leg., ch. 980, Sec. 1.13, eff. Sept. 1,
1995.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 2.011, eff.
September 1, 2005.
Sec. 402.067.AAADVISORY COMMITTEES. The commissioner may
appoint advisory committees as the commissioner considers
necessary.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 2.012, eff.
September 1, 2005.
Sec. 402.068.AADELEGATION OF RIGHTS AND DUTIES. Except as
expressly provided by this subtitle, the division may not delegate
rights and duties imposed on it by this subchapter.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1995, 74th Leg., ch. 980, Sec. 1.14, eff. Sept. 1, 1995.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 2.013, eff.
September 1, 2005.
Sec. 402.069.AAQUALIFICATIONS AND STANDARDS OF CONDUCT
INFORMATION. The commissioner or the commissioner ’s designee shall
provide to division employees, as often as necessary, information
regarding their:
(1)AAqualifications for office or employment under this
subtitle; and
(2)AAresponsibilities under applicable law relating to
standards of conduct for state officers or employees.
18
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1995, 74th Leg., ch. 980, Sec. 1.15, eff. Sept. 1, 1995.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 2.014, eff.
September 1, 2005.
Sec.A402.071.AAREPRESENTATIVES. (a) The commissioner shall
establish qualifications for a representative and shall adopt rules
establishing procedures for authorization of representatives.
(b)AAA representative may receive a fee for providing
representation under this subtitle only if the representative is:
(1)AAan adjuster representing an insurance carrier; or
(2)AAlicensed to practice law.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 2.015, eff.
September 1, 2005.
Sec. 402.073.AACOOPERATION WITH STATE OFFICE OF
ADMINISTRATIVE HEARINGS. (a)AAThe commissioner and the chief
administrative law judge of the State Office of Administrative
Hearings shall adopt a memorandum of understanding governing
administrative procedure law hearings under this subtitle
conducted by the State Office of Administrative Hearings in the
manner provided for a contested case hearing under Chapter 2001,
Government Code.AAThe memorandum of understanding must address the
payment of costs by parties to a medical fee dispute under Section
413.0312.
(b)AAIn a case in which a hearing is conducted by the State
Office of Administrative Hearings under Section 413.031 or 413.055,
the administrative law judge who conducts the hearing for the State
Office of Administrative Hearings shall enter the final decision in
the case after completion of the hearing.
(c)AAIn a case in which a hearing is conducted in conjunction
with Section 402.072, 407.046, 408.023, or 415.034, and in other
cases under this subtitle that are not subject to Subsection (b),
the administrative law judge who conducts the hearing for the State
19
Office of Administrative Hearings shall propose a decision to the
commissioner for final consideration and decision by the
commissioner.
(d)AAThe notice of the commissioner ’s order must include a
statement of the right of the person to judicial review of the
order.
(e)AAIn issuing an order under this section, the commissioner
shall comply with the requirements applicable to a state agency
under Section 2001.058, Government Code.
Added by Acts 1995, 74th Leg., ch. 980, Sec. 1.17, eff. Sept. 1,
1995. Amended by Acts 1999, 76th Leg., ch. 955, Sec. 1, eff. Sept.
1, 1999.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 2.017, eff.
September 1, 2005.
Acts 2007, 80th Leg., R.S., Ch. 1007 (H.B. 724), Sec. 3, eff.
September 1, 2007.
Acts 2011, 82nd Leg., R.S., Ch. 1162 (H.B. 2605), Sec. 8, eff.
September 1, 2011.
Sec. 402.074.AASTRATEGIC MANAGEMENT; EVALUATION. The
commissioner shall implement a strategic management plan that:
(1)AArequires the division to evaluate and analyze the
effectiveness of the division in implementing:
(A)AAthe statutory goals adopted under Section
402.021, particularly goals established to encourage the safe and
timely return of injured employees to productive work roles; and
(B)AAthe other standards and requirements adopted
under this code, the Insurance Code, and other applicable laws of
this state; and
(2)AAmodifies the organizational structure and
programs of the division as necessary to address shortfalls in the
performance of the workers ’ compensation system of this state.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 2.018, eff.
September 1, 2005.
Sec. 402.075.AAINCENTIVES; PERFORMANCE-BASED OVERSIGHT. (a)
20
The commissioner by rule shall adopt requirements that:
(1)AAprovide incentives for overall compliance in the
workers ’ compensation system of this state; and
(2)AAemphasize performance-based oversight linked to
regulatory outcomes.
(b)AAThe commissioner shall develop key regulatory goals to
be used in assessing the performance of insurance carriers and
health care providers.AAThe goals adopted under this subsection
must align with the general regulatory goals of the division under
this subtitle, such as improving workplace safety and
return-to-work outcomes, in addition to goals that support timely
payment of benefits and increased communication.
(c)AAAt least biennially, the division shall assess the
performance of insurance carriers and health care providers in
meeting the key regulatory goals.AAThe division shall examine
overall compliance records and dispute resolution and complaint
resolution practices to identify insurance carriers and health care
providers who adversely impact the workers ’ compensation system and
who may require enhanced regulatory oversight.AAThe division shall
conduct the assessment through analysis of data maintained by the
division and through self-reporting by insurance carriers and
health care providers.
(d)AABased on the performance assessment, the division shall
develop regulatory tiers that distinguish among insurance carriers
and health care providers who are poor performers, who generally
are average performers, and who are consistently high performers.
The division shall focus its regulatory oversight on insurance
carriers and health care providers identified as poor performers.
(e)AAThe commissioner by rule shall develop incentives
within each tier under Subsection (d) that promote greater overall
compliance and performance. The regulatory incentives may include
modified penalties, self-audits, or flexibility based on
performance.
(f)AAThe division shall:
(1)AAensure that high-performing entities are publicly
recognized; and
(2)AAallow those entities to use that designation as a
21
marketing tool.
(g)AAIn conjunction with the division ’s accident prevention
services under Subchapter E, Chapter 411, the division shall
conduct audits of accident prevention services offered by insurance
carriers based on the comprehensive risk assessment. The division
shall periodically review those services, but may provide
incentives for less regulation of carriers based on performance.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 2.018, eff.
September 1, 2005.
Sec. 402.076.AAGENERAL DUTIES; FUNDING. (a) The division
shall perform the workforce education and safety functions of the
workers ’ compensation system of this state.AA
(b)AAThe operations of the division under this section are
funded through the maintenance tax assessed under Section 403.002.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 2.018, eff.
September 1, 2005.
Sec. 402.077.AAEDUCATIONAL PROGRAMS. (a) The division shall
provide education on best practices for return-to-work programs and
workplace safety.
(b)AAThe division shall evaluate and develop the most
efficient, cost-effective procedures for implementing this
section.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 2.018, eff.
September 1, 2005.
Sec. 402.078.AAREGIONAL OFFICES. The department shall
operate regional offices throughout this state as necessary to
implement the duties of the division and the department under this
subtitle.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 2.018, eff.
September 1, 2005.
SUBCHAPTER E. RECORDS AND EMPLOYEE INFORMATION
Sec. 402.081.AADIVISION RECORDS. (a) The commissioner is
22
the custodian of the division ’s records and shall perform the
duties of a custodian required by law, including providing copies
and the certification of records.
(b)AAThe division shall comply with records retention
schedules as provided by Chapter 441.185, Government Code.
(c)AAA record maintained by the division may be preserved in
any format permitted by Chapter 441, Government Code, and rules
adopted by the Texas State Library and Archives Commission under
that chapter.
(d)AAThe division may charge a reasonable fee for making
available for inspection any of its information that contains
confidential information that must be redacted before the
information is made available.AAHowever, when a request for
information is for the inspection of 10 or fewer pages, and a copy
of the information is not requested, the division may charge only
the cost of making a copy of the page from which confidential
information must be redacted.AAThe fee for access to information
under Chapter 552, Government Code, shall be in accord with the
rules of the attorney general that prescribe the method for
computing the charge for copies under that chapter.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1997, 75th Leg., ch. 1270, Sec. 1 eff. June 20, 1997.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 2.019, eff.
September 1, 2005.
Acts 2005, 79th Leg., Ch. 329 (S.B. 727), Sec. 13, eff.
September 1, 2005.
Acts 2005, 79th Leg., Ch. 716 (S.B. 452), Sec. 11, eff.
September 1, 2005.
Acts 2007, 80th Leg., R.S., Ch. 921 (H.B. 3167), Sec. 10.003,
eff. September 1, 2007.
Sec. 402.082.AAINJURY INFORMATION MAINTAINED BY DIVISION.
(a) The division shall maintain information on every compensable
injury as to the:
(1)AArace, ethnicity, and sex of the claimant;
(2)AAclassification of the injury;
23
(3)AAidentification of whether the claimant is
receiving medical care through a workers ’ compensation health care
network certified under Chapter 1305, Insurance Code;
(4)AAamount of wages earned by the claimant before the
injury; and
(5)AAamount of compensation received by the claimant.
(b)AAOn request from the office of injured employee counsel,
the division shall provide to the office the identity, claim
number, and contact information of claimants receiving assistance
from the office.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 2.020, eff.
September 1, 2005.
Acts 2011, 82nd Leg., R.S., Ch. 289 (H.B. 1774), Sec. 5, eff.
September 1, 2011.
Sec.A402.083.AACONFIDENTIALITY OF INJURY INFORMATION. (a)
Information in or derived from a claim file regarding an employee is
confidential and may not be disclosed by the division except as
provided by this subtitle or other law.
(b)AAInformation concerning an employee who has been finally
adjudicated of wrongfully obtaining payment under Section 415.008
is not confidential.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1995, 74th Leg., ch. 76, Sec. 9.42, 14.49, eff. Sept. 1,
1995.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 2.021, eff.
September 1, 2005.
Sec.A402.084.AARECORD CHECK; RELEASE OF INFORMATION. (a)
The division shall perform and release a record check on an
employee, including current or prior injury information, to the
parties listed in Subsection (b) if:
(1)AAthe claim is:
(A)AAopen or pending before the division;
24
(B)AAon appeal to a court of competent
jurisdiction; or
(C)AAthe subject of a subsequent suit in which the
insurance carrier or the subsequent injury fund is subrogated to
the rights of the named claimant; and
(2)AAthe requesting party requests the release on a
form prescribed by the division for this purpose and provides all
required information.
(b)AAInformation on a claim may be released as provided by
Subsection (a) to:
(1)AAthe employee or the employee ’s legal beneficiary;
(2)AAthe employee ’s or the legal beneficiary ’s
representative;
(3)AAthe employer at the time of injury;
(4)AAthe insurance carrier;
(5)AAthe Texas Certified Self-Insurer Guaranty
Association established under Subchapter G, Chapter 407, if that
association has assumed the obligations of an impaired employer;
(6)AAthe Texas Property and Casualty Insurance Guaranty
Association, if that association has assumed the obligations of an
impaired insurance company;
(7)AAa third-party litigant in a lawsuit in which the
cause of action arises from the incident that gave rise to the
injury; or
(8)AAwith regard to information described by Subsection
(c-3), an insurance carrier that has adopted an antifraud plan
under Subchapter B, Chapter 704, Insurance Code, or the authorized
representative of such an insurance carrier.
(c)AAThe requirements of Subsection (a)(1) do not apply to a
request from a third-party litigant described by Subsection (b)(7).
(c-1)AAFor purposes of this section only, "insurance
carrier" means:
(1)AAa certified self-insurer; or
(2)AAan entity authorized under the Insurance Code or
another insurance law of this state that provides health insurance
coverage or health benefits in this state, including:
(A)AAan insurance company, including an insurance
25
company that holds a certificate of authority issued by the
commissioner of insurance to engage in the business of workers ’
compensation insurance in this state;
(B)AAa group hospital service corporation under
Chapter 842, Insurance Code;
(C)AAa health maintenance organization under
Chapter 843, Insurance Code;
(D)AAa stipulated premium company under Chapter
884, Insurance Code;
(E)AAa fully self-insured plan, as described by
the Employee Retirement Income Security Act of 1974 (29 U.S.C.
Section 1001 et seq.);
(F)AAa governmental plan, as defined by Section
3(32), Employee Retirement Income Security Act of 1974 (29 U.S.C.
Section 1002(32));
(G)AAan employee welfare benefit plan, as defined
by Section 3(1), Employee Retirement Income Security Act of 1974
(29 U.S.C. Section 1002(1)); and
(H)AAan insurer authorized by the Texas Department
of Insurance to offer disability insurance in this state.
(c-2)AAAn insurance carrier is not required to demonstrate
that a subclaim exists in order to obtain information under
Subsection (b)(8).
(c-3)AAAn insurance carrier described by Subsection (b)(8)
or an authorized representative of the insurance carrier may submit
to the commission on a monthly basis a written request for claims
information.AAThe request must contain a list of the names of
persons about whom claims information is requested.AAThe insurance
carrier must certify in the carrier ’s request that each person
listed is, or has been, an insured under the carrier ’s insurance
program.AAThe commission shall examine the commission ’s records to
identify all claims related to the listed persons.AAIf a claims
record exists for a listed person, the commission promptly shall
provide information on each workers ’ compensation claim filed by
that person to the carrier or the carrier ’s representative in an
electronic format.AAThe information provided under this subsection
must include, if available:
26
(1)AAthe full name of the workers ’ compensation
claimant;
(2)AAthe social security number of the workers ’
compensation claimant;
(3)AAthe date of birth of the workers ’ compensation
claimant;
(4)AAthe name of the employer of the workers ’
compensation claimant;
(5)AAthe date of the injury;
(6)AAa description of the type of injury or the body
part affected, including the workers ’ compensation claimant ’s
description of how the injury occurred;
(7)AAthe name of the treating doctor;
(8)AAthe name, address, and claim number of the
insurance carrier handling the claim;
(9)AAthe name of the insurance adjustor handling the
claim; and
(10)AAthe identifying number assigned to the claim by
the commission and the commission field office handling the claim.
(c-4)AAA potential subclaim identified by an insurance
carrier described by Subsection (b)(8) or an authorized
representative of the insurance carrier may form the basis for the
identification and filing of a subclaim against an insurance
carrier under this subtitle.
(c-5)AAInformation received under this section by an
insurance carrier described by Subsection (b)(8) or an authorized
representative of the insurance carrier remains subject to
confidentiality requirements of this subtitle while in the
possession of the insurance carrier or representative.AAHowever,
the following laws do not prohibit the commission from disclosing
full information regarding a claim as necessary to determine if a
valid subclaim exists:
(1)AAChapter 552, Government Code;
(2)AAChapter 159, Occupations Code; or
(3)AAany other analogous law restricting disclosure of
health care information.
(c-6)AAThe commission may not redact claims records produced
27
in an electronic data format under a request made under this
section.
(c-7)AAAn insurance carrier and its authorized
representative may request full claims data under Subsection
(b)(8), and the records shall be produced once each month.AAFor
purposes of this subsection, "full claims data" means an electronic
download or tape in an electronic data format of the information
listed in Subsection (c-3) on all cases relating to the workers ’
compensation claimants listed as insureds of the requesting
insurance carrier.
(d)AA The commissioner by rule may establish a reasonable
fee, not to exceed five cents for each claimant listed in an
information request, for all information requested by an insurance
carrier described by Subsection (b)(8) or an authorized
representative of the insurance carrier in an electronic data
format. The commissioner shall adopt rules under Section
401.024(d) to establish:
(1)AAreasonable security parameters for all transfers
of information requested under this section in electronic data
format; and
(2)AArequirements regarding the maintenance of
electronic data in the possession of an insurance carrier described
by Subsection (b)(8) or an authorized representative of the
insurance carrier.
(e)AAThe insurance carrier or the carrier ’s authorized
representative must execute a written agreement with the commission
before submitting the carrier ’s first request under Subsection
(c-3).AAThe agreement must contain a provision by which the carrier
and the representative agree to comply with the commission ’s rules
governing security parameters applicable to the transfer of
information under Subsection (d)(1) and the maintenance of
electronic data under Subsection (d)(2).
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 2001, 77th Leg., ch. 1033, Sec. 5, eff. Sept. 1, 2001.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 2.022, eff.
September 1, 2005.
28
Acts 2005, 79th Leg., Ch. 728 (H.B. 2018), Sec. 11.132, eff.
September 1, 2005.
Acts 2005, 79th Leg., Ch. 1190 (H.B. 251), Sec. 1, eff. June
18, 2005.
Sec. 402.085.AAEXCEPTIONS TO CONFIDENTIALITY. (a)AAThe
division shall release information on a claim to:
(1)AAthe Texas Department of Insurance for any
statutory or regulatory purpose, including a research purpose under
Chapter 405;
(2)AAa legislative committee for legislative purposes;
(3)AAa state or federal elected official requested in
writing to provide assistance by a constituent who qualifies to
obtain injury information under Section 402.084(b), if the request
for assistance is provided to the division;
(4)AAthe attorney general or another entity that
provides child support services under Part D, Title IV, Social
Security Act (42 U.S.C. Section 651 et seq.), relating to:
(A)AAestablishing, modifying, or enforcing a
child support or medical support obligation; or
(B)AAlocating an absent parent; or
(5)AAthe office of injured employee counsel for any
statutory or regulatory purpose that relates to a duty of that
office as provided by Section 404.111(a).
(b)AAThe division may release information on a claim to a
governmental agency, political subdivision, or regulatory body to
use to:
(1)AAinvestigate an allegation of a criminal offense or
licensing or regulatory violation;
(2)AAprovide:
(A)AAunemployment compensation benefits;
(B)AAcrime victims compensation benefits;
(C)AAvocational rehabilitation services; or
(D)AAhealth care benefits;
(3)AAinvestigate occupational safety or health
violations;
(4)AAverify income on an application for benefits under
29
an income-based state or federal assistance program; or
(5)AAassess financial resources in an action, including
an administrative action, to:
(A)AAestablish, modify, or enforce a child support
or medical support obligation;
(B)AAestablish paternity;
(C)AAlocate an absent parent; or
(D)AAcooperate with another state in an action
authorized under Part D, Title IV, Social Security Act (42 U.S.C.
Section 651 et seq.), or Chapter 231, Family Code.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1995, 74th Leg., ch. 76, Sec. 9.43(a), eff. Sept. 1, 1995;
Acts 1999, 76th Leg., ch. 1426, Sec. 5, eff. Sept. 1, 1999.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 2.023, eff.
September 1, 2005.
Acts 2011, 82nd Leg., R.S., Ch. 289 (H.B. 1774), Sec. 6, eff.
September 1, 2011.
Sec.A402.086.AATRANSFER OF CONFIDENTIALITY. (a)
Information relating to a claim that is confidential under this
subtitle remains confidential when released to any person, except
when used in court for the purposes of an appeal.
(b)AAThis section does not prohibit an employer from
releasing information about a former employee to another employer
with whom the employee has applied for employment, if that
information was lawfully acquired by the employer releasing the
information.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A402.087.AAINFORMATION AVAILABLE TO PROSPECTIVE
EMPLOYERS. (a) A prospective employer who has workers ’
compensation insurance coverage and who complies with this
subchapter is entitled to obtain information on the prior injuries
of an applicant for employment if the employer obtains written
authorization from the applicant before making the request.
(b)AAThe employer must make the request by telephone or file
30
the request in writing not later than the 14th day after the date on
which the application for employment is made.
(c)AAThe request must include the applicant ’s name, address,
and social security number.
(d)AAIf the request is made in writing, the authorization
must be filed simultaneously. If the request is made by telephone,
the employer must file the authorization not later than the 10th day
after the date on which the request is made.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A402.088.AAREPORT OF PRIOR INJURY. (a) On receipt of a
valid request made under and complying with Section 402.087, the
division shall review its records.
(b)AAIf the division finds that the applicant has made two or
more general injury claims in the preceding five years, the
division shall release the date and description of each injury to
the employer.
(c)AAThe information may be released in writing or by
telephone.
(d)AAIf the employer requests information on three or more
applicants at the same time, the division may refuse to release
information until it receives the written authorization from each
applicant.
(e)AAIn this section, "general injury" means an injury other
than an injury limited to one or more of the following:
(1)AAan injury to a digit, limb, or member;
(2)AAan inguinal hernia; or
(3)AAvision or hearing loss.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 2.024, eff.
September 1, 2005.
Sec. 402.089.AAFAILURE TO FILE AUTHORIZATION. An employer
who receives information by telephone from the division under
Section 402.088 and who fails to file the necessary authorization
in accordance with Section 402.087 commits an administrative
31
violation.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 2.025, eff.
September 1, 2005.
Sec. 402.090.AASTATISTICAL INFORMATION. The division, the
Texas Department of Insurance, or any other governmental agency may
prepare and release statistical information if the identity of an
employee is not explicitly or implicitly disclosed.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 2.026, eff.
September 1, 2005.
Sec.A402.091.AAFAILURE TO MAINTAIN CONFIDENTIALITY;
OFFENSE; PENALTY. (a) A person commits an offense if the person
knowingly, intentionally, or recklessly publishes, discloses, or
distributes information that is confidential under this subchapter
to a person not authorized to receive the information directly from
the division.
(b)AAA person commits an offense if the person knowingly,
intentionally, or recklessly receives information that is
confidential under this subchapter and that the person is not
authorized to receive.
(c)AAAn offense under this section is a Class A misdemeanor.
(d)AAAn offense under this section may be prosecuted in a
court in the county where the information was unlawfully received,
published, disclosed, or distributed.
(e)AAA district court in Travis County has jurisdiction to
enjoin the use, publication, disclosure, or distribution of
confidential information under this section.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1995, 74th Leg., ch. 980, Sec. 1.18, eff. Sept. 1, 1995.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 2.027, eff.
September 1, 2005.
32
Sec. 402.092.AAINVESTIGATION FILES CONFIDENTIAL; DISCLOSURE
OF CERTAIN INFORMATION. (a) In this section, "investigation file"
means any information compiled or maintained by the division with
respect to a division investigation authorized under this subtitle
or other workers ’ compensation law.AAThe term does not include
information or material acquired by the division that is relevant
to an investigation by the insurance fraud unit and subject to
Section 701.151, Insurance Code.
(b)AAInformation maintained in the investigation files of
the division is confidential and may not be disclosed except:
(1)AAin a criminal proceeding;
(2)AAin a hearing conducted by the division;
(3)AAon a judicial determination of good cause;
(4)AAto a governmental agency, political subdivision,
or regulatory body if the disclosure is necessary or proper for the
enforcement of the laws of this or another state or of the United
States; or
(5)AAto an insurance carrier if the investigation file
relates directly to a felony regarding workers ’ compensation or to
a claim in which restitution is required to be paid to the insurance
carrier.
(c)AADivision investigation files are not open records for
purposes of Chapter 552, Government Code.
(d)AAInformation in an investigation file that is
information in or derived from a claim file, or an employer injury
report or occupational disease report, is governed by the
confidentiality provisions relating to that information.
(e)AAThe division, upon request, shall disclose the identity
of a complainant under this section if the division finds:
(1)AAthe complaint was groundless or made in bad faith;
(2)AAthe complaint lacks any basis in fact or evidence;
(3)AAthe complaint is frivolous; or
(4)AAthe complaint is done specifically for competitive
or economic advantage.
(f)AAUpon completion of an investigation in which the
division determines a complaint is described by Subsection (e), the
33
division shall notify the person who was the subject of the
complaint of its finding and the identity of the complainant.
Added by Acts 1995, 74th Leg., ch. 980, Sec. 1.19, eff. Sept. 1,
1995.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 2.028, eff.
September 1, 2005.
SUBCHAPTER F. COOPERATION WITH OFFICE OF INJURED EMPLOYEE COUNSEL
Sec. 402.251.AACOOPERATION; FACILITIES. (a) The department
and the division shall cooperate with the office of injured
employee counsel in providing services to claimants under this
subtitle.
(b)AAThe department shall provide facilities to the office of
injured employee counsel in each regional office operated to
administer the duties of the division under this subtitle.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 2.029, eff.
September 1, 2005.
34
LABOR CODE
TITLE 5. WORKERS ’ COMPENSATION
SUBTITLE A. TEXAS WORKERS ’ COMPENSATION ACT
CHAPTER 406. WORKERS ’ COMPENSATION INSURANCE COVERAGE
SUBCHAPTER A. COVERAGE ELECTION; SECURITY PROCEDURES
Sec.A406.001.AADEFINITION. In this subchapter, "employer"
means a person who employs one or more employees.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A406.002.AACOVERAGE GENERALLY ELECTIVE. (a) Except for
public employers and as otherwise provided by law, an employer may
elect to obtain workers ’ compensation insurance coverage.
(b)AAAn employer who elects to obtain coverage is subject to
this subtitle.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A406.003.AAMETHODS OF OBTAINING COVERAGE. An employer
may obtain workers ’ compensation insurance coverage through a
licensed insurance company or through self-insurance as provided by
this subtitle.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec. 406.004.AAEMPLOYER NOTICE TO DIVISION. (a) An employer
who does not obtain workers ’ compensation insurance coverage shall
notify the division in writing, in the time and as prescribed by
commissioner rule, that the employer elects not to obtain coverage.
(b)AAThe commissioner shall prescribe forms to be used for
the employer notification and shall require the employer to provide
reasonable information to the division about the employer ’s
business.
(c)AAThe division may contract with the Texas Workforce
Commission or the comptroller for assistance in collecting the
notification required under this section.AAThose agencies shall
cooperate with the division in enforcing this section.
(d)AAThe employer notification filing required under this
1
section shall be filed with the division in accordance with Section
406.009.
(e)AAAn employer commits an administrative violation if the
employer fails to comply with this section.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1995, 74th Leg., ch. 76, Sec. 9.47(a), eff. Sept. 1, 1995.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.023, eff.
September 1, 2005.
Sec.A406.005.AAEMPLOYER NOTICE TO EMPLOYEES; ADMINISTRATIVE
VIOLATION. (a) An employer shall notify each employee as provided
by this section whether or not the employer has workers ’
compensation insurance coverage.
(b)AAThe employer shall notify a new employee of the
existence or absence of workers ’ compensation insurance coverage at
the time the employee is hired.
(c)AAEach employer shall post a notice of whether the
employer has workers ’ compensation insurance coverage at
conspicuous locations at the employer ’s place of business as
necessary to provide reasonable notice to the employees.AAThe
commissioner may adopt rules relating to the form and content of the
notice.AAThe employer shall revise the notice when the information
contained in the notice is changed.
(d)AAAn employer who obtains workers ’ compensation insurance
coverage or whose coverage is terminated or canceled shall notify
each employee that the coverage has been obtained, terminated, or
canceled not later than the 15th day after the date on which the
coverage, or the termination or cancellation of the coverage, takes
effect.
(e)AAAn employer commits an administrative violation if the
employer fails to comply with this section.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.024, eff.
September 1, 2005.
2
Sec.A406.006.AAINSURANCE COVERAGE AND CLAIM ADMINISTRATION
REPORTING REQUIREMENTS; ADMINISTRATIVE VIOLATION. (a) An
insurance company from which an employer has obtained workers ’
compensation insurance coverage, a certified self-insurer, a
workers ’ compensation self-insurance group under Chapter 407A, and
a political subdivision shall file notice of the coverage and claim
administration contact information with the division not later than
the 10th day after the date on which the coverage or claim
administration agreement takes effect, unless the commissioner
adopts a rule establishing a later date for filing.AACoverage takes
effect on the date on which a binder is issued, a later date and time
agreed to by the parties, on the date provided by the certificate of
self-insurance, or on the date provided in an interlocal agreement
that provides for self-insurance.AAThe commissioner may adopt
rules that establish the coverage and claim administration contact
information required under this subsection.
(b)AAThe notice required under this section shall be filed
with the division in accordance with Section 406.009.
(c)AAAn insurance company, a certified self-insurer, a
workers ’ compensation self-insurance group under Chapter 407A, or a
political subdivision commits an administrative violation if the
person fails to file notice with the division as provided by this
section.
(d)AAIn this section, "political subdivision" has the
meaning assigned by Section 504.001.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1995, 74th Leg., ch. 76, Sec. 9.48(a), eff. Sept. 1, 1995;
Acts 1999, 76th Leg., ch. 954, Sec. 2.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.025, eff.
September 1, 2005.
Sec.A406.007.AATERMINATION OF COVERAGE BY EMPLOYER; NOTICE.
(a) An employer who terminates workers ’ compensation insurance
coverage obtained under this subtitle shall file a written notice
with the division by certified mail not later than the 10th day
after the date on which the employer notified the insurance carrier
3
to terminate the coverage.AAThe notice must include a statement
certifying the date that notice was provided or will be provided to
affected employees under Section 406.005.
(b)AAThe notice required under this section shall be filed
with the division in accordance with Section 406.009.
(c)AATermination of coverage takes effect on the later of:
(1)AAthe 30th day after the date of filing of notice
with the division under Subsection (a); or
(2)AAthe cancellation date of the policy.
(d)AAThe coverage shall be extended until the date on which
the termination of coverage takes effect, and the employer is
obligated for premiums due for that period.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1995, 74th Leg., ch. 76, Sec. 9.49(a), eff. Sept. 1, 1995.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.026, eff.
September 1, 2005.
Sec. 406.008.AACANCELLATION OR NONRENEWAL OF COVERAGE BY
INSURANCE COMPANY; NOTICE. (a) An insurance company that cancels a
policy of workers ’ compensation insurance or that does not renew
the policy by the anniversary date of the policy shall deliver
notice of the cancellation or nonrenewal by certified mail or in
person to the employer and the division not later than:
(1)AAthe 30th day before the date on which the
cancellation or nonrenewal takes effect; or
(2)AAthe 10th day before the date on which the
cancellation or nonrenewal takes effect if the insurance company
cancels or does not renew because of:
(A)AAfraud in obtaining coverage;
(B)AAmisrepresentation of the amount of payroll
for purposes of premium calculation;
(C)AAfailure to pay a premium when due;
(D)AAan increase in the hazard for which the
employer seeks coverage that results from an act or omission of the
employer and that would produce an increase in the rate, including
an increase because of a failure to comply with:
4
(i)AAreasonable recommendations for loss
control; or
(ii)AArecommendations designed to reduce a
hazard under the employer ’s control within a reasonable period; or
(E)AAa determination made by the commissioner of
insurance that the continuation of the policy would place the
insurer in violation of the law or would be hazardous to the
interest of subscribers, creditors, or the general public.
(b)AAThe notice required under this section shall be filed
with the division.
(c)AAFailure of the insurance company to give notice as
required by this section extends the policy until the date on which
the required notice is provided to the employer and the division.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1995, 74th Leg., ch. 76, Sec. 9.50(a), eff. Sept. 1, 1995.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.027, eff.
September 1, 2005.
Sec. 406.009.AACOLLECTING AND MAINTAINING INFORMATION;
MONITORING AND ENFORCING COMPLIANCE. (a) The division shall
collect and maintain the information required under this subchapter
and shall monitor compliance with the requirements of this
subchapter.
(b)AAThe commissioner may adopt rules as necessary to enforce
this subchapter.
(c)AAThe commissioner may designate a data collection agent,
implement an electronic reporting and public information access
program, and adopt rules as necessary to implement the data
collection requirements of this subchapter.AAThe commissioner may
establish the form, manner, and procedure for the transmission of
information to the division.AAA data collection agent designated
under this subsection must be qualified and may collect fees in the
manner described by Section 401.024.
(d)AAThe division may require an employer or insurance
carrier subject to this subtitle to identify or confirm an
employer ’s coverage status and claim administration contact
5
information as necessary to achieve the purposes of this subtitle.
(e)AAAn employer or insurance carrier commits an
administrative violation if that person fails to comply with
Subsection (d).
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1995, 74th Leg., ch. 76, Sec. 9.51(a), eff. Sept. 1, 1995;
Acts 1999, 76th Leg., ch. 954, Sec. 3, eff. Sept. 1, 1999.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.028, eff.
September 1, 2005.
Acts 2011, 82nd Leg., R.S., Ch. 410 (S.B. 800), Sec. 2, eff.
June 17, 2011.
Sec.A406.010.AACLAIMS SERVICE; ADMINISTRATIVE VIOLATION.
(a) An insurance carrier shall provide claims service:
(1)AAthrough offices of the insurance carrier located
in this state; or
(2)AAby other resident representatives with full power
to act for the insurance carrier.
(b)AAEach insurance carrier shall designate persons to
provide claims service in sufficient numbers and at appropriate
locations to reasonably service policies written by the
carrier.AAIf an insurance carrier uses the services of a person
required to hold a certificate of authority under Chapter 4151,
Insurance Code, the carrier must comply with the requirements of
that chapter.
(c)AAThe commissioner by rule shall further specify the
requirements of this section.
(d)AAA person commits an administrative violation if the
person violates a rule adopted under this section.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.029, eff.
September 1, 2005.
Acts 2007, 80th Leg., R.S., Ch. 1176 (H.B. 472), Sec. 3.01,
eff. September 1, 2007.
6
Sec. 406.011.AAAUSTIN REPRESENTATIVE; ADMINISTRATIVE
VIOLATION. (a) The commissioner by rule may require an insurance
carrier to designate a representative in Austin to act as the
insurance carrier ’s agent before the division in Austin.AANotice to
the designated agent constitutes notice to the insurance carrier.
(b)AAA person commits an administrative violation if the
person violates a rule adopted under this section.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.030, eff.
September 1, 2005.
Sec.A406.012.AAENFORCEMENT OF SUBCHAPTER. The commission
shall enforce the administrative penalties established under this
subchapter in accordance with Chapter 415.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
SUBCHAPTER B. COVERAGE REQUIREMENTS
Sec.A406.031.AALIABILITY FOR COMPENSATION. (a) An
insurance carrier is liable for compensation for an employee ’s
injury without regard to fault or negligence if:
(1)AAat the time of injury, the employee is subject to
this subtitle; and
(2)AAthe injury arises out of and in the course and
scope of employment.
(b)AAIf an injury is an occupational disease, the employer in
whose employ the employee was last injuriously exposed to the
hazards of the disease is considered to be the employer of the
employee under this subtitle.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A406.032.AAEXCEPTIONS. An insurance carrier is not
liable for compensation if:
(1)AAthe injury:
(A)AAoccurred while the employee was in a state of
intoxication;
7
(B)AAwas caused by the employee ’s wilful attempt
to injure himself or to unlawfully injure another person;
(C)AAarose out of an act of a third person intended
to injure the employee because of a personal reason and not directed
at the employee as an employee or because of the employment;
(D)AAarose out of voluntary participation in an
off-duty recreational, social, or athletic activity that did not
constitute part of the employee ’s work-related duties, unless the
activity is a reasonable expectancy of or is expressly or impliedly
required by the employment; or
(E)AAarose out of an act of God, unless the
employment exposes the employee to a greater risk of injury from an
act of God than ordinarily applies to the general public; or
(2)AAthe employee ’s horseplay was a producing cause of
the injury.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A406.033.AACOMMON-LAW DEFENSES; BURDEN OF PROOF.
(a)AAIn an action against an employer by or on behalf of an employee
who is not covered by workers ’ compensation insurance obtained in
the manner authorized by Section 406.003 to recover damages for
personal injuries or death sustained by an employee in the course
and scope of the employment, it is not a defense that:
(1)AAthe employee was guilty of contributory
negligence;
(2)AAthe employee assumed the risk of injury or death;
or
(3)AAthe injury or death was caused by the negligence of
a fellow employee.
(b)AAThis section does not reinstate or otherwise affect the
availability of defenses at common law, including the defenses
described by Subsection (a).
(c)AAThe employer may defend the action on the ground that
the injury was caused:
(1)AAby an act of the employee intended to bring about
the injury; or
(2)AAwhile the employee was in a state of intoxication.
8
(d)AAIn an action described by Subsection (a), the plaintiff
must prove negligence of the employer or of an agent or servant of
the employer acting within the general scope of the agent ’s or
servant ’s employment.
(e)AAA cause of action described in Subsection (a) may not be
waived by an employee before the employee ’s injury or death. Any
agreement by an employee to waive a cause of action or any right
described in Subsection (a) before the employee ’s injury or death
is void and unenforceable.
(f)AAA cause of action described by Subsection (a) may not be
waived by an employee after the employee ’s injury unless:
(1)AAthe employee voluntarily enters into the waiver
with knowledge of the waiver ’s effect;
(2)AAthe waiver is entered into not earlier than the
10th business day after the date of the initial report of injury;
(3)AAthe employee, before signing the waiver, has
received a medical evaluation from a nonemergency care doctor; and
(4)AAthe waiver is in a writing under which the true
intent of the parties is specifically stated in the document.
(g)AAThe waiver provisions required under Subsection (f)
must be conspicuous and appear on the face of the agreement.AATo be
conspicuous, the waiver provisions must appear in a type larger
than the type contained in the body of the agreement or in
contrasting colors.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 2001, 77th Leg., ch. 1456, Sec. 16.01, eff. June 17, 2001.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.031, eff.
September 1, 2005.
Acts 2011, 82nd Leg., R.S., Ch. 1108 (S.B. 1714), Sec. 1, eff.
September 1, 2011.
Sec.A406.034.AAEMPLOYEE ELECTION. (a) Except as otherwise
provided by law, unless the employee gives notice as provided by
Subsection (b), an employee of an employer waives the employee ’s
right of action at common law or under a statute of this state to
recover damages for personal injuries or death sustained in the
9
course and scope of the employment.
(b)AAAn employee who desires to retain the common-law right
of action to recover damages for personal injuries or death shall
notify the employer in writing that the employee waives coverage
under this subtitle and retains all rights of action under common
law. The employee must notify the employer not later than the fifth
day after the date on which the employee:
(1)AAbegins the employment; or
(2)AAreceives written notice from the employer that the
employer has obtained workers ’ compensation insurance coverage if
the employer is not a covered employer at the time of the employment
but later obtains the coverage.
(c)AAAn employer may not require an employee to retain
common-law rights under this section as a condition of employment.
(d)AAAn employee who elects to retain the right of action or a
legal beneficiary of that employee may bring a cause of action for
damages for injuries sustained in the course and scope of the
employment under common law or under a statute of this
state.AANotwithstanding Section 406.033, the cause of action is
subject to all defenses available under common law and the statutes
of this state unless the employee has waived coverage in connection
with an agreement with the employer.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2011, 82nd Leg., R.S., Ch. 1108 (S.B. 1714), Sec. 2, eff.
September 1, 2011.
Sec.A406.035.AAWAIVER OF COMPENSATION PROHIBITED. Except as
provided by this subtitle, an agreement by an employee to waive the
employee ’s right to compensation is void.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
SUBCHAPTER C. COVERAGE THROUGH COMMERCIAL INSURANCE
Sec.A406.051.AASECURITY BY COMMERCIAL INSURANCE. (a) An
insurance company may contract to secure an employer ’s liability
and obligations and to pay compensation by issuing a workers ’
10
compensation insurance policy under this subchapter.
(b)AAThe contract for coverage must be written on a policy
and endorsements approved by the Texas Department of Insurance.
(c)AAThe employer may not transfer:
(1)AAthe obligation to accept a report of injury under
Section 409.001;
(2)AAthe obligation to maintain records of injuries
under Section 409.006;
(3)AAthe obligation to report injuries to the insurance
carrier under Section 409.005;
(4)AAliability for a violation of Section 415.006 or
415.008 or of Chapter 451; or
(5)AAthe obligation to comply with a commissioner
order.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1999, 76th Leg., ch. 954, Sec. 4, eff. Sept. 1, 1999.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.032, eff.
September 1, 2005.
Sec.A406.052.AAEFFECT OF OTHER INSURANCE COVERAGE. (a) A
contract entered into to indemnify an employer from loss or damage
resulting from an injury sustained by an employee that is
compensable under this subtitle is void unless the contract also
covers liability for payment of compensation under this subtitle.
(b)AAThis section does not prohibit an employer who is not
required to have workers ’ compensation insurance coverage and who
has elected not to obtain workers ’ compensation insurance coverage
from obtaining insurance coverage on the employer ’s employees if
the insurance is not represented to any person as providing
workers ’ compensation insurance coverage authorized under this
subtitle.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A406.053.AAALL STATES COVERAGE. The Texas Department of
Insurance shall coordinate with the appropriate agencies of other
states to:
11
(1)AAshare information regarding an employer who
obtains all states coverage; and
(2)AAensure that the department has knowledge of an
employer who obtains all states coverage in another state but fails
to file notice with the department.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
SUBCHAPTER D. EXTRATERRITORIAL COVERAGE
Sec.A406.071.AAEXTRATERRITORIAL COVERAGE. (a) An employee
who is injured while working in another jurisdiction or the
employee ’s legal beneficiary is entitled to all rights and remedies
under this subtitle if:
(1)AAthe injury would be compensable if it had occurred
in this state; and
(2)AAthe employee has significant contacts with this
state or the employment is principally located in this state.
(b)AAAn employee has significant contacts with this state if
the employee was hired or recruited in this state and the employee:
(1)AAwas injured not later than one year after the date
of hire; or
(2)AAhas worked in this state for at least 10 working
days during the 12 months preceding the date of injury.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A406.072.AAPRINCIPAL LOCATION. The principal location
of a person ’s employment is where:
(1)AAthe employer has a place of business at or from
which the employee regularly works; or
(2)AAthe employee resides and spends a substantial part
of the employee ’s working time.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A406.073.AAAGREEMENT ON PRINCIPAL LOCATION;
ADMINISTRATIVE VIOLATION. (a) An employee whose work requires
regular travel between this state and at least one other
jurisdiction may agree in writing with the employer on the
12
principal location of the employment.
(b)AAThe employer shall file the agreement with the division
on request.
(c)AAA person commits an administrative violation if the
person violates Subsection (b).
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.033, eff.
September 1, 2005.
Sec.A406.074.AAINTERJURISDICTIONAL AGREEMENTS. (a) The
commissioner may enter into an agreement with an appropriate agency
of another jurisdiction with respect to:
(1)AAconflicts of jurisdiction;
(2)AAassumption of jurisdiction in a case in which the
contract of employment arises in one state and the injury is
incurred in another;
(3)AAprocedures for proceeding against a foreign
employer who fails to comply with this subtitle; and
(4)AAprocedures for the appropriate agency to use to
proceed against an employer of this state who fails to comply with
the workers ’ compensation laws of the other jurisdiction.
(b)AAAn executed agreement that has been adopted as a rule by
the commissioner binds all subject employers and employees.
(c)AAIn this section, "appropriate agency" means an agency of
another jurisdiction that administers the workers ’ compensation
laws of that jurisdiction.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.034, eff.
September 1, 2005.
Sec.A406.075.AAEFFECT OF COMPENSATION PAID IN OTHER
JURISDICTION. (a) An injured employee who elects to pursue the
employee ’s remedy under the workers ’ compensation laws of another
jurisdiction and who recovers benefits under those laws may not
recover under this subtitle.
13
(b)AAThe amount of benefits accepted under the laws of the
other jurisdiction without an election under Subsection (a) shall
be credited against the benefits that the employee would have
received had the claim been made under this subtitle.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
SUBCHAPTER E. APPLICATION OF COVERAGE TO CERTAIN EMPLOYEES
Sec.A406.091.AAEXEMPT EMPLOYEES; VOLUNTARY COVERAGE. (a)
The following employees are not subject to this subtitle:
(1)AAa person employed as a domestic worker or a casual
worker engaged in employment incidental to a personal residence;
(2)AAa person covered by a method of compensation
established under federal law; or
(3)AAexcept as provided by Subchapter H, a farm or ranch
employee.
(b)AAAn employer may elect to obtain workers ’ compensation
insurance coverage for an employee or classification of employees
exempted from coverage under Subsection (a)(1) or (a)(3).
Obtaining that coverage constitutes acceptance by the employer of
the rights and responsibilities imposed under this subtitle as of
the effective date of the coverage for as long as the coverage
remains in effect.
(c)AAAn employer who does not obtain coverage for exempt
employees is not deprived of the common-law defenses described by
Section 406.033, but this section does not reinstate or otherwise
affect the availability of those or other defenses at common law.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A406.092.AAALIEN EMPLOYEES AND BENEFICIARIES. (a) A
resident or nonresident alien employee or legal beneficiary is
entitled to compensation under this subtitle.
(b)AAA nonresident alien employee or legal beneficiary, at
the election of the employee or legal beneficiary, may be
represented officially by a consular officer of the country of
which the employee or legal beneficiary is a citizen. That officer
may receive benefit payments for distribution to the employee or
14
legal beneficiary. The receipt of the payments constitutes full
discharge of the insurance carrier ’s liability for those payments.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A406.093.AALEGALLY INCOMPETENT EMPLOYEES. (a) The
guardian of an injured employee who is a minor or is otherwise
legally incompetent may exercise on the employee ’s behalf the
rights and privileges granted to the employee under this subtitle.
(b)AAThe commissioner by rule shall adopt procedures
relating to the method of payment of benefits to legally
incompetent employees.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.035, eff.
September 1, 2005.
Sec.A406.094.AACERTAIN PERSONS LICENSED BY TEXAS REAL ESTATE
COMMISSION. (a) An employer who elects to provide workers ’
compensation insurance coverage may include in the coverage a real
estate salesperson or broker who is:
(1)AAlicensed under Chapter 1101, Occupations Code;
and
(2)AAcompensated solely by commissions.
(b)AAIf coverage is elected by the employer, the insurance
policy must specifically name the salesperson or broker. The
coverage continues while the policy is in effect and the named
salesperson or broker is endorsed on the policy.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 2003, 78th Leg., ch. 1276, Sec. 14A.788, eff. Sept. 1, 2003.
Sec.A406.095.AACERTAIN PROFESSIONAL ATHLETES. (a) A
professional athlete employed under a contract for hire or a
collective bargaining agreement who is entitled to benefits for
medical care and weekly benefits that are equal to or greater than
the benefits provided under this subtitle may not receive benefits
under this subtitle and the equivalent benefits under the contract
or collective bargaining agreement. An athlete covered by such a
15
contract or agreement who sustains an injury in the course and scope
of the athlete ’s employment shall elect to receive either the
benefits available under this subtitle or the benefits under the
contract or agreement.
(b)AAThe commissioner by rule shall establish the procedures
and requirements for an election under this section.
(c)AAIn this section, "professional athlete" means a person
employed as a professional athlete by a franchise of:
(1)AAthe National Football League;
(2)AAthe National Basketball Association;
(3)AAthe American League of Professional Baseball
Clubs;
(4)AAthe National League of Professional Baseball
Clubs;
(5)AAthe International Hockey League;
(6)AAthe National Hockey League; or
(7)AAthe Central Hockey League.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1995, 74th Leg., ch. 668, Sec. 1, eff. Sept. 1, 1995.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.036, eff.
September 1, 2005.
Acts 2005, 79th Leg., Ch. 815 (S.B. 742), Sec. 1, eff.
September 1, 2005.
Sec.A406.096.AAREQUIRED COVERAGE FOR CERTAIN BUILDING OR
CONSTRUCTION CONTRACTORS. (a) A governmental entity that enters
into a building or construction contract shall require the
contractor to certify in writing that the contractor provides
workers ’ compensation insurance coverage for each employee of the
contractor employed on the public project.
(b)AAEach subcontractor on the public project shall provide
such a certificate relating to coverage of the subcontractor ’s
employees to the general contractor, who shall provide the
subcontractor ’s certificate to the governmental entity.
(c)AAA contractor who has a contract that requires workers ’
compensation insurance coverage may provide the coverage through a
16
group plan or other method satisfactory to the governing body of the
governmental entity.
(d)AAThe employment of a maintenance employee by an employer
who is not engaging in building or construction as the employer ’s
primary business does not constitute engaging in building or
construction.
(e)AAIn this section:
(1)AA"Building or construction" includes:
(A)AAerecting or preparing to erect a structure,
including a building, bridge, roadway, public utility facility, or
related appurtenance;
(B)AAremodeling, extending, repairing, or
demolishing a structure; or
(C)AAotherwise improving real property or an
appurtenance to real property through similar activities.
(2)AA"Governmental entity" means this state or a
political subdivision of this state. The term includes a
municipality.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A406.097.AAEXECUTIVE EMPLOYEES OF CERTAIN BUSINESS
ENTITIES. (a) A sole proprietor, partner, or corporate executive
officer of a business entity that elects to provide workers ’
compensation insurance coverage is entitled to benefits under that
coverage as an employee unless the sole proprietor, partner, or
corporate executive officer is specifically excluded from coverage
through an endorsement to the insurance policy or certificate of
authority to self-insure.
(b)AAThe dual capacity doctrine does not apply to a corporate
executive officer with an equity ownership in the covered business
entity of at least 25 percent and will not invalidate the exclusion
of such a corporate executive officer from coverage under
Subsection (a).
(c)AAA sole proprietor or partner of a covered business
entity or a corporate officer with an equity ownership in a covered
business entity of at least 25 percent may be excluded from coverage
under this section notwithstanding Section 406.096.
17
Added by Acts 1995, 74th Leg., ch. 980, Sec. 1.20, eff. Sept. 1,
1995.
Sec.A406.098.AAVOLUNTEER EMERGENCY SERVICE MEMBERS AND
PERSONNEL. (a) An emergency service organization which is not a
political subdivision or which is separate from any political
subdivision may elect to obtain workers ’ compensation insurance
coverage for its named volunteer members who participate in the
normal functions of the organization. A person covered under this
subsection is entitled to full medical benefits and the minimum
compensation payments under the law.
(b)AAIn this section, unless a different meaning is plainly
required by law:
(1)AA"Emergency service organization" means any
organization established to provide for the general public:
(A)AAfire prevention and suppression;
(B)AAhazardous materials response operations; or
(C)AAemergency medical services.
(2)AA"Volunteer members" means individuals who are
carried on the membership list of the organization as active
participants and who receive no remuneration for their services.
(3)AA"Normal functions" means any response to,
participation in, or departure from an incident scene; training;
meetings; performance of equipment maintenance; or organizational
functions.
(4)AA"Political subdivision" means a county,
municipality, special district, school district, junior college
district, housing authority, community center for mental health and
mental retardation services established under Subchapter A,
Chapter 534, Health and Safety Code, or any other legally
constituted political subdivision of the state.
(c)AAThe commissioner of insurance shall adopt rules
governing the method of calculating premiums for workers ’
compensation insurance coverage for volunteer members who are
covered pursuant to this section.
Added by Acts 1995, 74th Leg., ch. 849, Sec. 1, eff. Aug. 28, 1995.
Renumbered from Labor Code Sec. 406.097 by Acts 1997, 75th Leg., ch.
18
165, Sec. 31.01(63), eff. Sept. 1, 1997.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.037, eff.
September 1, 2005.
SUBCHAPTER F. COVERAGE OF CERTAIN INDEPENDENT CONTRACTORS
Sec.A406.121.AADEFINITIONS. In this subchapter:
(1)AA"General contractor" means a person who undertakes
to procure the performance of work or a service, either separately
or through the use of subcontractors. The term includes a
"principal contractor," "original contractor," "prime contractor,"
or other analogous term. The term does not include a motor carrier
that provides a transportation service through the use of an owner
operator.
(2)AA"Independent contractor" means a person who
contracts to perform work or provide a service for the benefit of
another and who ordinarily:
(A)AAacts as the employer of any employee of the
contractor by paying wages, directing activities, and performing
other similar functions characteristic of an employer-employee
relationship;
(B)AAis free to determine the manner in which the
work or service is performed, including the hours of labor of or
method of payment to any employee;
(C)AAis required to furnish or to have employees,
if any, furnish necessary tools, supplies, or materials to perform
the work or service; and
(D)AApossesses the skills required for the
specific work or service.
(3)AA"Motor carrier" means a person who operates a
motor vehicle over a public highway in this state to provide a
transportation service or who contracts to provide that service.
(4)AA"Owner operator" means a person who provides
transportation services under contract for a motor carrier. An
owner operator is an independent contractor.
(5)AA"Subcontractor" means a person who contracts with
19
a general contractor to perform all or part of the work or services
that the general contractor has undertaken to perform.
(6)AA"Transportation service" means providing a motor
vehicle, with a driver under contract, to transport passengers or
property.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A406.122.AASTATUS AS EMPLOYEE. (a) For purposes of
workers ’ compensation insurance coverage, a person who performs
work or provides a service for a general contractor or motor carrier
who is an employer under this subtitle is an employee of that
general contractor or motor carrier, unless the person is:
(1)AAoperating as an independent contractor; or
(2)AAhired to perform the work or provide the service as
an employee of a person operating as an independent contractor.
(b)AAA subcontractor and the subcontractor ’s employees are
not employees of the general contractor for purposes of this
subtitle if the subcontractor:
(1)AAis operating as an independent contractor; and
(2)AAhas entered into a written agreement with the
general contractor that evidences a relationship in which the
subcontractor assumes the responsibilities of an employer for the
performance of work.
(c)AAAn owner operator and the owner operator ’s employees are
not employees of a motor carrier for the purposes of this subtitle
if the owner operator has entered into a written agreement with the
motor carrier that evidences a relationship in which the owner
operator assumes the responsibilities of an employer for the
performance of work.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A406.123.AAELECTION TO PROVIDE COVERAGE; ADMINISTRATIVE
VIOLATION. (a) A general contractor and a subcontractor may enter
into a written agreement under which the general contractor
provides workers ’ compensation insurance coverage to the
subcontractor and the employees of the subcontractor.
(b)AAIf a general contractor has workers ’ compensation
20
insurance to protect the general contractor ’s employees and if, in
the course and scope of the general contractor ’s business, the
general contractor enters into a contract with a subcontractor who
does not have employees, the general contractor shall be treated as
the employer of the subcontractor for the purposes of this subtitle
and may enter into an agreement for the deduction of premiums paid
in accordance with Subsection (d).
(c)AAA motor carrier and an owner operator may enter into a
written agreement under which the motor carrier provides workers ’
compensation insurance coverage to the owner operator and the
employees of the owner operator.
(d)AAIf a general contractor or a motor carrier elects to
provide coverage under Subsection (a) or (c), then, notwithstanding
Section 415.006, the actual premiums, based on payroll, that are
paid or incurred by the general contractor or motor carrier for the
coverage may be deducted from the contract price or other amount
owed to the subcontractor or owner operator by the general
contractor or motor carrier.
(e)AAAn agreement under this section makes the general
contractor the employer of the subcontractor and the
subcontractor ’s employees only for purposes of the workers ’
compensation laws of this state.
(f)AAA general contractor shall file a copy of an agreement
entered into under this section with the general contractor ’s
workers ’ compensation insurance carrier not later than the 10th day
after the date on which the contract is executed.AAIf the general
contractor is a certified self-insurer, the copy must be filed with
the division.
(g)AAA general contractor who enters into an agreement with a
subcontractor under this section commits an administrative
violation if the contractor fails to file a copy of the agreement as
required by Subsection (f).
(h)AANotwithstanding Subsection (b), a person who performs
work or provides a service for an oil or gas well operator and who is
an independent contractor that has no employees shall be treated in
the same manner as an independent contractor with employees and is
not entitled to coverage under the general contractor ’s workers ’
21
compensation insurance policy unless the independent contractor
and the general contractor enter into an agreement under this
section.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1997, 75th Leg., ch. 88, Sec. 1, eff. Sept. 1, 1997.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.038, eff.
September 1, 2005.
Sec.A406.124.AACAUSE OF ACTION. If a person who has workers ’
compensation insurance coverage subcontracts all or part of the
work to be performed by the person to a subcontractor with the
intent to avoid liability as an employer under this subtitle, an
employee of the subcontractor who sustains a compensable injury in
the course and scope of the employment shall be treated as an
employee of the person for purposes of workers ’ compensation and
shall have a separate right of action against the subcontractor.
The right of action against the subcontractor does not affect the
employee ’s right to compensation under this subtitle.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A406.125.AARESTRICTION OF UNSAFE WORK PRACTICES
UNAFFECTED. This subchapter does not prevent a general contractor
from directing a subcontractor or the employees of a subcontractor
to stop or change an unsafe work practice.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A406.126.AAEXEMPTION. This subchapter does not apply to
farm or ranch employees.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A406.127.AAEFFECT OF CERTAIN CONTRACTS OF HIRE. An
insurance company may not demand an insurance premium from an
employer for coverage of an independent contractor or an employee
of an independent contractor if the independent contractor is under
a contract of hire with the employer.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
22
SUBCHAPTER G. COVERAGE OF CERTAIN BUILDING AND CONSTRUCTION WORKERS
Sec.A406.141.AADEFINITIONS. In this subchapter:
(1)AA"Hiring contractor" means a general contractor or
subcontractor who, in the course of regular business, subcontracts
all or part of the work to be performed to other persons.
(2)AA"Independent contractor" means a person who
contracts to perform work or provide a service for the benefit of
another and who:
(A)AAis paid by the job and not by the hour or some
other time-measured basis;
(B)AAis free to hire as many helpers as desired and
may determine the pay of each helper; and
(C)AAis free to, while under contract to the
hiring contractor, work for other contractors or is free to send
helpers to work for other contractors.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A406.142.AAAPPLICATION. This subchapter applies only to
contractors and workers preparing to construct, constructing,
altering, repairing, extending, or demolishing:
(1)AAa residential structure;
(2)AAa commercial structure that does not exceed three
stories in height or 20,000 square feet in area; or
(3)AAan appurtenance to a structure described by
Subdivision (1) or (2).
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A406.143.AAPROVISION OF WORKERS ’ COMPENSATION
INSURANCE; INDEPENDENT CONTRACTOR WITHOUT EMPLOYEES. (a) Unless
the independent contractor and hiring contractor enter into an
agreement under Section 406.144, the independent contractor is
responsible for any workers ’ compensation insurance coverage
provided to an employee of the independent contractor, and the
independent contractor ’s employees are not entitled to workers ’
compensation insurance coverage from the hiring contractor.
23
(b)AAAn independent contractor without employees shall be
treated in the same manner as an independent contractor with
employees and is not entitled to coverage under the hiring
contractor ’s workers ’ compensation insurance policy unless the
independent contractor and hiring contractor enter into an
agreement under Section 406.144.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A406.144.AAELECTION TO PROVIDE COVERAGE; AGREEMENT.
(a) Except as provided by this section, a hiring contractor is not
responsible for providing workers ’ compensation insurance coverage
for an independent contractor or the independent contractor ’s
employee, helper, or subcontractor. An independent contractor and
a hiring contractor may enter into a written agreement under which
the independent contractor agrees that the hiring contractor may
withhold the cost of workers ’ compensation insurance coverage from
the contract price and that, for the purpose of providing workers ’
compensation insurance coverage, the hiring contractor is the
employer of the independent contractor and the independent
contractor ’s employees.
(b)AAA hiring contractor and independent contractor may
enter into an agreement under Subsection (a) even if the
independent contractor does not have an employee.
(c)AAAn agreement under this section shall be filed with the
division either by personal delivery or by registered or certified
mail and is considered filed on receipt by the division.
(d)AAThe hiring contractor shall send a copy of an agreement
under this section to the hiring contractor ’s workers ’ compensation
insurance carrier on filing of the agreement with the division.
(e)AAAn agreement under this section makes the hiring
contractor the employer of the independent contractor and the
independent contractor ’s employees only for the purposes of the
workers ’ compensation laws of this state.
(f)AAThe deduction of the cost of the workers ’ compensation
insurance coverage from the independent contractor ’s contract
price is permitted notwithstanding Section 415.006.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
24
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.039, eff.
September 1, 2005.
Sec.A406.145.AAJOINT AGREEMENT. (a) A hiring contractor and
an independent subcontractor may make a joint agreement declaring
that the subcontractor is an independent contractor as defined in
Section 406.141(2) and that the subcontractor is not the employee
of the hiring contractor.AAIf the joint agreement is signed by both
the hiring contractor and the subcontractor and filed with the
division, the subcontractor, as a matter of law, is an independent
contractor and not an employee, and is not entitled to workers ’
compensation insurance coverage through the hiring contractor
unless an agreement is entered into under Section 406.144 to
provide workers ’ compensation insurance coverage.AAThe
commissioner shall prescribe forms for the joint agreement.
(b)AAA joint agreement shall be delivered to the division by
personal delivery or registered or certified mail and is considered
filed on receipt by the division.
(c)AAThe hiring contractor shall send a copy of a joint
agreement signed under this section to the hiring contractor ’s
workers ’ compensation insurance carrier on filing of the joint
agreement with the division.
(d)AAThe division shall maintain a system for accepting and
maintaining the joint agreements.
(e)AAA joint agreement signed under this section applies to
each hiring agreement between the hiring contractor and the
independent contractor until the first anniversary of its filing
date, unless a subsequent hiring agreement expressly states that
the joint agreement does not apply.
(f)AAIf a subsequent hiring agreement is made to which the
joint agreement does not apply, the hiring contractor and
independent contractor shall notify the division and the hiring
contractor ’s workers ’ compensation insurance carrier in writing.
(g)AAIf a hiring contractor and an independent contractor
have filed a joint agreement under this section, an insurance
company may not require the payment of an insurance premium by a
25
hiring contractor for coverage of an independent contractor or an
independent contractor ’s employee, helper, or subcontractor other
than under an agreement entered into in compliance with Section
406.144.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.040, eff.
September 1, 2005.
Sec.A406.146.AAWRONGFUL INDUCEMENT PROHIBITED. (a) A
hiring contractor may not:
(1)AAwrongfully induce an employee to enter into a
joint agreement under Section 406.145 stating that the employee is
an independent contractor; or
(2)AAexert controls over an independent contractor or
an employee of an independent contractor sufficient to make that
person an employee under common-law tests.
(b)AAA hiring contractor does not exert employer-like
controls over an independent contractor or an independent
contractor ’s employee solely because of:
(1)AAcontrolling the hours of labor, if that control is
exercised only to:
(A)AAestablish the deadline for the completion of
the work called for by the contract;
(B)AAschedule work to occur in a logical sequence
and to avoid delays or interference with the work of other
contractors; or
(C)AAschedule work to avoid disturbing neighbors
during night or early morning hours or at other times when the
independent contractor ’s activities would unreasonably disturb
activities in the neighborhood; or
(2)AAstopping or directing work solely to prevent or
correct an unsafe work practice or condition or to control work to
ensure that the end product is in compliance with the contracted for
result.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
26
SUBCHAPTER H. COVERAGE OF FARM AND RANCH EMPLOYEES
Sec.A406.161.AADEFINITIONS. In this subchapter:
(1)AA"Agricultural labor" means the planting,
cultivating, or harvesting of an agricultural or horticultural
commodity in its unmanufactured state.
(2)AA"Family" means persons related within the third
degree by consanguinity or affinity.
(3)AA"Labor agent" means a person who:
(A)AAis a farm labor contractor for purposes of
the Migrant and Seasonal Agricultural Worker Protection Act (29
U.S.C. Section 1801 et seq.); or
(B)AAotherwise recruits, solicits, hires,
employs, furnishes, or transports migrant or seasonal agricultural
workers who work for the benefit of a third party.
(4)AA"Migrant worker" means an individual who is:
(A)AAemployed in agricultural labor of a seasonal
or temporary nature; and
(B)AArequired to be absent overnight from the
worker ’s permanent place of residence.
(5)AA"Seasonal worker" means an individual who is:
(A)AAemployed in agricultural or ranch labor of a
seasonal or temporary nature; and
(B)AAnot required to be absent overnight from the
worker ’s permanent place of residence.
(6)AA"Truck farm" means a farm on which fruits, garden
vegetables for human consumption, potatoes, sugar beets, or
vegetable seeds are produced for market. The term includes a farm
primarily devoted to one of those crops that also has incidental
acreage of other crops.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A406.162.AASCOPE. (a) This subtitle applies to an
action to recover damages for personal injuries or death sustained
by a farm or ranch employee who is:
(1)AAa migrant worker;
(2)AAa seasonal worker:
27
(A)AAemployed on a truck farm, orchard, or
vineyard;
(B)AAemployed by a person with a gross annual
payroll for the preceding year in an amount not less than the
greater of the required payroll for the year preceding that year,
adjusted for inflation, or $25,000; or
(C)AAworking for a farmer, ranch operator, or
labor agent who employs a migrant worker and doing the same work at
the same time and location as the migrant worker; or
(3)AAan employee, other than a migrant or seasonal
worker:
(A)AAfor years before 1991, employed by a person
with a gross annual payroll for the preceding year of at least
$50,000; and
(B)AAfor 1991 and subsequent years, employed by a
person:
(i)AAwith a gross annual payroll in an amount
required for coverage of seasonal workers under Subdivision (2)(B);
or
(ii)AAwho employs three or more farm or ranch
employees other than migrant or seasonal workers.
(b)AAThe comptroller shall prepare a consumer price index for
this state and shall certify the applicable index factor to the
division before October 1 of each year.AAThe division shall adjust
the gross annual payroll requirement under Subsection (a)(2)(B)
accordingly.
(c)AAFor the purposes of this section, the gross annual
payroll of a person includes any amount paid by the person to a
labor agent for the agent ’s services and for the services of migrant
or seasonal workers but does not include wages paid to:
(1)AAthe person or a member of the person ’s family, if
the person is a sole proprietor;
(2)AAa partner in a partnership or a member of the
partner ’s family; or
(3)AAa shareholder of a corporation in which all
shareholders are family members or a member of the shareholder ’s
family.
28
(d)AAThis subchapter does not affect the application or
interpretation of this subtitle as it relates to persons engaged in
activities determined before January 1, 1985, not to be farm or
ranch labor.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.041, eff.
September 1, 2005.
Sec.A406.163.AALIABILITY OF LABOR AGENT; JOINT AND SEVERAL
LIABILITY. (a) A labor agent who furnishes a migrant or seasonal
worker is liable under this subtitle as if the labor agent were the
employer of the worker, without regard to the right of control or
other factors used to determine an employer-employee relationship.
(b)AAIf the labor agent does not have workers ’ compensation
insurance coverage, the person with whom the labor agent contracts
for the services of the migrant or seasonal worker is jointly and
severally liable with the labor agent in an action to recover
damages for personal injuries or death suffered by the migrant or
seasonal worker as provided by this subtitle, and, for that
purpose, the migrant or seasonal worker is considered the employee
of the person with whom the labor agent contracts and that person
may obtain workers ’ compensation insurance coverage for that worker
as provided by this subtitle. If a migrant or seasonal worker is
covered by workers ’ compensation insurance coverage, the person
with whom the labor agent contracts is not liable in a separate
action for injury or death except to the extent provided by this
subtitle.
(c)AAA labor agent shall notify each person with whom the
agent contracts of whether the agent has workers ’ compensation
insurance coverage. If the agent does have workers ’ compensation
insurance coverage, the agent shall present evidence of the
coverage to each person with whom the agent contracts.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A406.164.AAELECTIVE COVERAGE OF EMPLOYER AND FAMILY
MEMBERS. (a) A person who purchases a workers ’ compensation
29
insurance policy covering farm or ranch employees may cover the
person, a partner, a corporate officer, or a family member in that
policy. The insurance policy must specifically name the individual
to be covered.
(b)AAThe elective coverage continues while the policy is in
effect and the named individual is endorsed on the policy.
(c)AAA member of an employer ’s family is exempt from coverage
under the policy unless an election for that coverage is made under
this section.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A406.165.AANOT APPLICABLE TO INDEPENDENT CONTRACTORS.
(a) A farm or ranch employee who performs work or provides a
service for a farm or ranch employer subject to this subchapter is
an employee of that employer unless the employee is hired to perform
the work or provide the service as an employee of an independent
contractor.
(b)AAIn this section, "independent contractor" means a
person, other than a labor agent, who contracts with a farm or ranch
employer to perform work or provide a service for the benefit of the
employer and who ordinarily:
(1)AAacts as the employer of the employee by paying
wages, directing activities, and performing other similar
functions characteristic of an employer-employee relationship;
(2)AAis free to determine the manner in which the work
or service is performed, including the hours of labor or the method
of payment;
(3)AAis required to furnish necessary tools, supplies,
or materials to perform the work or service; and
(4)AApossesses skills required for the specific work or
service.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
30
LABOR CODE
TITLE 5. WORKERS ’ COMPENSATION
SUBTITLE A. TEXAS WORKERS ’ COMPENSATION ACT
CHAPTER 408. WORKERS ’ COMPENSATION BENEFITS
SUBCHAPTER A. GENERAL PROVISIONS
Sec.A408.001.AAEXCLUSIVE REMEDY; EXEMPLARY DAMAGES. (a)
Recovery of workers ’ compensation benefits is the exclusive remedy
of an employee covered by workers ’ compensation insurance coverage
or a legal beneficiary against the employer or an agent or employee
of the employer for the death of or a work-related injury sustained
by the employee.
(b)AAThis section does not prohibit the recovery of exemplary
damages by the surviving spouse or heirs of the body of a deceased
employee whose death was caused by an intentional act or omission of
the employer or by the employer ’s gross negligence.
(c)AAIn this section, "gross negligence" has the meaning
assigned by Section 41.001, Civil Practice and Remedies Code.
(d)AAA determination under Section 406.032, 409.002, or
409.004 that a work-related injury is noncompensable does not
adversely affect the exclusive remedy provisions under Subsection
(a).
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.077, eff.
September 1, 2005.
Sec.A408.002.AASURVIVAL OF CAUSE OF ACTION. A right of
action survives in a case based on a compensable injury that results
in the employee ’s death.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1991.
Sec.A408.003.AAREIMBURSABLE EMPLOYER PAYMENTS; SALARY
CONTINUATION; OFFSET AGAINST INCOME BENEFITS; LIMITS. (a) After
an injury, an employer may:
(1)AAinitiate benefit payments, including medical
1
benefits; or
(2)AAon the written request or agreement of the
employee, supplement income benefits paid by the insurance carrier
by an amount that does not exceed the amount computed by subtracting
the amount of the income benefit payments from the employee ’s net
preinjury wages.
(b)AAIf an injury is found to be compensable and an insurance
carrier initiates compensation, the insurance carrier shall
reimburse the employer for the amount of benefits paid by the
employer to which the employee was entitled under this subtitle.
Payments that are not reimbursed or reimbursable under this section
may be reimbursed under Section 408.127.
(c)AAThe employer shall notify the division and the insurance
carrier on forms prescribed by the commissioner of the initiation
of and amount of payments made under this section.
(d)AAEmployer payments made under this section:
(1)AAmay not be construed as an admission of
compensability; and
(2)AAdo not affect the payment of benefits from another
source.
(e)AAIf an employer does not notify the insurance carrier of
the injury in compliance with Section 409.005, the employer waives
the right to reimbursement under this section.
(f)AASalary continuation payments made by an employer for an
employee ’s disability resulting from a compensable injury shall be
considered payment of income benefits for the purpose of
determining the accrual date of any subsequent income benefits
under this subtitle.
(g)AAIf an employer is subject to a contractual obligation
with an employee or group of employees, such as a collective
bargaining agreement or a written agreement or policy, under which
the employer is required to make salary continuation payments, the
employer is not eligible for reimbursement under this section for
those payments.
(h)AAPayments made as salary continuation or salary
supplementation do not affect the exclusive remedy provisions of
Section 408.001.
2
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1999, 76th Leg., ch. 954, Sec. 5, eff. Sept. 1, 1999; Acts
1999, 76th Leg., ch. 1003, Sec. 1, 2, eff. Sept. 1, 1999.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.078, eff.
September 1, 2005.
Sec.A408.004.AAREQUIRED MEDICAL EXAMINATIONS;
ADMINISTRATIVE VIOLATION. (a) The commissioner may require an
employee to submit to medical examinations to resolve any question
aboutAAthe appropriateness of the health care received by the
employee.
(a-1)AAA doctor, other than a chiropractor, who performs a
required medical examination under this section is subject to
Section 408.0043.AAA chiropractor who performs a required medical
examination under this section is subject to Section 408.0045.
(b)AAThe commissioner may require an employee to submit to a
medical examination at the request of the insurance carrier, but
only after the insurance carrier has attempted and failed to
receive the permission and concurrence of the employee for the
examination.AAExcept as otherwise provided by this subsection, the
insurance carrier is entitled to the examination only once in a
180-day period.AAThe commissioner may adopt rules that require an
employee to submit to not more than three medical examinations in a
180-day period under specified circumstances, including to
determine whether there has been a change in the employee ’s
condition and whether it is necessary to change the employee ’s
diagnosis.AAThe commissioner by rule shall adopt a system for
monitoring requests made under this subsection by insurance
carriers.AAThat system must ensure that good cause exists for any
additional medical examination allowed under this subsection that
is not requested by the employee.AAA subsequent examination must be
performed by the same doctor unless otherwise approved by the
commissioner.
(c)AAThe insurance carrier shall pay for:
(1)AAan examination required under Subsection (a) or
(b); and
3
(2)AAthe reasonable expenses incident to the employee
in submitting to the examination.
(d)AAAn injured employee is entitled to have a doctor of the
employee ’s choice present at an examination required by the
division at the request of an insurance carrier.AAThe insurance
carrier shall pay a fee set by the commissioner to the doctor
selected by the employee.
(e)AAAn employee who, without good cause as determined by the
commissioner, fails or refuses to appear at the time scheduled for
an examination under Subsection (a) or (b) commits an
administrative violation.AA The commissioner by rule shall ensure
that an employee receives reasonable notice of an examination and
that the employee is provided a reasonable opportunity to
reschedule an examination missed by the employee for good cause.
(f)AAThis section does not apply to health care provided
through a workers ’ compensation health care network established
under Chapter 1305, Insurance Code.
(g)AAAn insurance carrier who makes a frivolous request for a
medical examination under Subsection (b), as determined by the
commissioner, commits an administrative violation.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1997, 75th Leg., ch. 1133, Sec. 1, 2, eff. Sept. 1, 1999;
Acts 1999, 76th Leg., ch. 1426, Sec. 8, eff. Jan. 1, 2000; Acts
2001, 77th Leg., ch. 1456, Sec. 5.01, eff. June 17, 2001.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.079, eff.
September 1, 2005.
Acts 2007, 80th Leg., R.S., Ch. 1218 (H.B. 2004), Sec. 2, eff.
September 1, 2007.
Sec. 408.0041.AADESIGNATED DOCTOR EXAMINATION. (a) At the
request of an insurance carrier or an employee, or on the
commissioner ’s own order, the commissioner may order a medical
examination to resolve any question about:
(1)AAthe impairment caused by the compensable injury;
(2)AAthe attainment of maximum medical improvement;
(3)AAthe extent of the employee ’s compensable injury;
4
(4)AAwhether the injured employee ’s disability is a
direct result of the work-related injury;
(5)AAthe ability of the employee to return to work; or
(6)AAissues similar to those described by Subdivisions
(1)-(5).
(b)AAExcept as provided by Section 408.1225(f), a medical
examination requested under Subsection (a) shall be performed by
the next available doctor on the division ’s list of certified
designated doctors whose credentials are appropriate for the area
of the body affected by the injury and the injured employee ’s
diagnosis as determined by commissioner rule.AA The division shall
assign a designated doctor not later than the 10th day after the
date on which the request under Subsection (a) is approved, and the
examination must be conducted not later than the 21st day after the
date on which the commissioner issues the order under Subsection
(a).AAAn examination under this section may not be conducted more
frequently than every 60 days, unless good cause for more frequent
examinations exists, as defined by commissioner rules.
(b-1)AAA designated doctor, other than a chiropractor, is
subject to Section 408.0043.AAA designated doctor who is a
chiropractor is subject to Section 408.0045.AATo the extent of a
conflict between this section and Section 408.0043 or 408.0045,
this section controls.
(c)AAThe treating doctor and the insurance carrier are both
responsible for sending to the designated doctor all of the injured
employee ’s medical records relating to the issue to be evaluated by
the designated doctor that are in their possession.AAThe treating
doctor and insurance carrier may send the records without a signed
release from the employee.AAThe designated doctor is authorized to
receive the employee ’s confidential medical records to assist in
the resolution of disputes.AAThe treating doctor and insurance
carrier may also send the designated doctor an analysis of the
injured employee ’s medical condition, functional abilities, and
return-to-work opportunities.
(d)AATo avoid undue influence on a person selected as a
designated doctor under this section, and except as provided by
Subsection (c), only the injured employee or an appropriate member
5
of the division ’s staff may communicate with the designated doctor
about the case regarding the injured employee ’s medical condition
or history before the examination of the injured employee by the
designated doctor.AAAfter that examination is completed,
communication with the designated doctor regarding the injured
employee ’s medical condition or history may be made only through
appropriate division staff members.AAThe designated doctor may
initiate communication with any doctor or health care provider who
has previously treated or examined the injured employee for the
work-related injury or with peer reviewers identified by the
insurance carrier.
(e)AAThe designated doctor shall report to the
division.AAThe report of the designated doctor has presumptive
weight unless the preponderance of the evidence is to the
contrary.AAAn employer may make a bona fide offer of employment
subject to Sections 408.103(e) and 408.144(c) based on the
designated doctor ’s report.
(f)AAUnless otherwise ordered by the commissioner, the
insurance carrier shall pay benefits based on the opinion of the
designated doctor during the pendency of any dispute. If an
insurance carrier is not satisfied with the opinion rendered by a
designated doctor under this section, the insurance carrier may
request the commissioner to order an employee to attend an
examination by a doctor selected by the insurance carrier.
(f-1)AAThe subsequent injury fund shall reimburse an
insurance carrier for any overpayment of benefits made by the
insurance carrier under Subsection (f) based on an opinion rendered
by a designated doctor if that opinion is reversed or modified by a
final arbitration award or a final order or decision of the
commissioner or a court.AAThe commissioner shall adopt rules to
provide for a periodic reimbursement schedule, providing
reimbursement at least annually.
(f-2)AAAn employee required to be examined by a designated
doctor may request a medical examination to determine maximum
medical improvement and the employee ’s impairment rating from the
treating doctor or from another doctor to whom the employee is
referred by the treating doctor if:
6
(1)AAthe designated doctor ’s opinion is the employee ’s
first evaluation of maximum medical improvement and impairment
rating; and
(2)AAthe employee is not satisfied with the designated
doctor ’s opinion.
(f-3)AAThe commissioner shall provide the insurance carrier
and the employee with reasonable time to obtain and present the
opinion of a doctor selected under Subsection (f) or (f-2) before
the commissioner makes a decision on the merits of the issue.
(f-4)AAThe commissioner by rule shall adopt guidelines
prescribing the circumstances under which an examination by the
employee ’s treating doctor or another doctor to whom the employee
is referred by the treating doctor to determine any issue under
Subsection (a), other than an examination under Subsection (f-2),
may be appropriate.
(g)AAExcept as otherwise provided by this subsection, an
injured employee is entitled to have a doctor of the employee ’s
choice present at an examination requested by an insurance carrier
under Subsection (f).AAThe insurance carrier shall pay a fee set by
the commissioner to the doctor selected by the employee.AAIf the
injured employee is subject to a workers ’ compensation health care
network under Chapter 1305, Insurance Code, the doctor must be the
employee ’s treating doctor.
(h)AAThe insurance carrier shall pay for:
(1)AAan examination required under Subsection (a), (f),
or (f-2), unless otherwise prohibited by this subtitle or by an
order or rule of the commissioner; and
(2)AAthe reasonable expenses incident to the employee
in submitting to the examination.
(i)AAAn employee who, without good cause as determined by the
commissioner, fails or refuses to appear at the time scheduled for
an examination under Subsection (a) or (f) commits an
administrative violation.AAAn injured employee may not be fined
more than $10,000 for a violation of this subsection.
(j)AAAn employee is not entitled to temporary income
benefits, and an insurance carrier is authorized to suspend the
payment of temporary income benefits, during and for a period in
7
which the employee fails to submit to an examination required by
Subsection (a) or (f) unless the commissioner determines that the
employee had good cause for the failure to submit to the
examination.AAThe commissioner may order temporary income benefits
to be paid for the period for which the commissioner determined that
the employee had good cause.AAThe commissioner by rule shall ensure
that:
(1)AAan employee receives reasonable notice of an
examination and the insurance carrier ’s basis for suspension; and
(2)AAthe employee is provided a reasonable opportunity
to reschedule an examination for good cause.
(k)AAIf the report of a designated doctor indicates that an
employee has reached maximum medical improvement or is otherwise
able to return to work immediately, the insurance carrier may
suspend or reduce the payment of temporary income benefits
immediately.
(l)AAA person who makes a frivolous request for a medical
examination under Subsection (a) or (f), as determined by the
commissioner, commits an administrative violation.
Added by Acts 2001, 77th Leg., ch. 1456, Sec. 5.02, eff. June 17,
2001.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.080, eff.
September 1, 2005.
Acts 2007, 80th Leg., R.S., Ch. 1150 (S.B. 1169), Sec. 1, eff.
September 1, 2007.
Acts 2007, 80th Leg., R.S., Ch. 1218 (H.B. 2004), Sec. 3, eff.
September 1, 2007.
Acts 2011, 82nd Leg., R.S., Ch. 1162 (H.B. 2605), Sec. 11,
eff. September 1, 2011.
Sec. 408.0042.AAMEDICAL EXAMINATION BY TREATING DOCTOR TO
DEFINE COMPENSABLE INJURY. (a) The division shall require an
injured employee to submit to a single medical examination to
define the compensable injury on request by the insurance carrier.
(b)AAA medical examination under this section shall be
performed by the employee ’s treating doctor.AAThe insurance
8
carrier shall pay the costs of the examination.
(c)AAAfter the medical examination is performed, the
treating doctor shall submit to the insurance carrier a report that
details all injuries and diagnoses related to the compensable
injury, on receipt of which the insurance carrier shall:
(1)AAaccept all injuries and diagnoses as related to
the compensable injury; or
(2)AAdispute the determination of specific injuries and
diagnoses.
(d)AAAny treatment for an injury or diagnosis that is not
accepted by the insurance carrier under Subsection (c) as
compensable at the time of the medical examination under Subsection
(a) must be preauthorized before treatment is rendered. If the
insurance carrier denies preauthorization because the treatment is
for an injury or diagnosis unrelated to the compensable injury, the
injured employee or affected health care provider may file an
extent of injury dispute.
(e)AAAny treatment for an injury or diagnosis that is
accepted by the insurance carrier under Subsection (c) as
compensable at the time of the medical examination under Subsection
(a) may not be reviewed for compensability, but may be reviewed for
medical necessity.
(f)AAThe commissioner may adopt rules relating to
requirements for a report under this section, including
requirements regarding the contents of a report.
(g)AAThis section does not limit an injured employee or
insurance carrier ’s ability to request an examination under Section
408.004 or 408.0041, as provided by those sections.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.0805, eff.
September 1, 2005.
Sec. 408.0043.AAPROFESSIONAL SPECIALTY CERTIFICATION
REQUIRED FOR CERTAIN REVIEW. (a) This section applies to a person,
other than a chiropractor or a dentist, who performs health care
services under this title as:
(1)AAa doctor performing peer review;
(2)AAa doctor performing a utilization review of a
9
health care service provided to an injured employee;
(3)AAa doctor performing an independent review of a
health care service provided to an injured employee;
(4)AAa designated doctor;
(5)AAa doctor performing a required medical
examination; or
(6)AAa doctor serving as a member of the medical quality
review panel.
(b)AAA person described by Subsection (a) who reviews a
specific workers ’ compensation case must hold a professional
certification in a health care specialty appropriate to the type of
health care that the injured employee is receiving.
Added by Acts 2007, 80th Leg., R.S., Ch. 1218 (H.B. 2004), Sec. 1,
eff. September 1, 2007.
Amended by:
Acts 2009, 81st Leg., R.S., Ch. 1330 (H.B. 4290), Sec. 14,
eff. September 1, 2009.
Sec. 408.0044.AAREVIEW OF DENTAL SERVICES. (a) This section
applies to a dentist who performs dental services under this title
as:
(1)AAa doctor performing peer review of dental
services;
(2)AAa doctor performing a utilization review of a
dental service provided to an injured employee;
(3)AAa doctor performing an independent review of a
dental service provided to an injured employee; or
(4)AAa doctor performing a required dental examination.
(b)AAA person described by Subsection (a) who reviews a
dental service provided in conjunction with a specific workers ’
compensation case must be licensed to practice dentistry.
Added by Acts 2007, 80th Leg., R.S., Ch. 1218 (H.B. 2004), Sec. 1,
eff. September 1, 2007.
Amended by:
Acts 2009, 81st Leg., R.S., Ch. 1330 (H.B. 4290), Sec. 15,
eff. September 1, 2009.
10
Sec. 408.0045.AAREVIEW OF CHIROPRACTIC SERVICES. (a) This
section applies to a chiropractor who performs chiropractic
services under this title as:
(1)AAa doctor performing peer review of chiropractic
services;
(2)AAa doctor performing a utilization review of a
chiropractic service provided to an injured employee;
(3)AAa doctor performing an independent review of a
chiropractic service provided to an injured employee;
(4)AAa designated doctor providing chiropractic
services;
(5)AAa doctor performing a required medical
examination; or
(6)AAa chiropractor serving as a member of the medical
quality review panel.
(b)AAA person described by Subsection (a) who reviews a
chiropractic service provided in conjunction with a specific
workers ’ compensation case must be licensed to engage in the
practice of chiropractic.
Added by Acts 2007, 80th Leg., R.S., Ch. 1218 (H.B. 2004), Sec. 1,
eff. September 1, 2007.
Amended by:
Acts 2009, 81st Leg., R.S., Ch. 1330 (H.B. 4290), Sec. 16,
eff. September 1, 2009.
Sec. 408.0046.AARULES. The commissioner may adopt rules as
necessary to determine which professional health practitioner
specialties are appropriate for treatment of certain compensable
injuries.AAThe rules adopted under this section must require an
entity requesting a peer review to obtain and provide to the doctor
providing peer review services all relevant and updated medical
records.
Added by Acts 2007, 80th Leg., R.S., Ch. 1218 (H.B. 2004), Sec. 1,
eff. September 1, 2007.
Sec.A408.005.AASETTLEMENTS AND AGREEMENTS. (a) A
settlement may not provide for payment of benefits in a lump sum
11
except as provided by Section 408.128.
(b)AAAn employee ’s right to medical benefits as provided by
Section 408.021 may not be limited or terminated.
(c)AAA settlement or agreement resolving an issue of
impairment:
(1)AAmay not be made before the employee reaches
maximum medical improvement; and
(2)AAmust adopt an impairment rating using the
impairment rating guidelines described by Section 408.124.
(d)AAA settlement must be signed by the commissioner and all
parties to the dispute.
(e)AAThe commissioner shall approve a settlement if the
commissioner is satisfied that:
(1)AAthe settlement accurately reflects the agreement
between the parties;
(2)AAthe settlement reflects adherence to all
appropriate provisions of law and the policies of the division; and
(3)AAunder the law and facts, the settlement is in the
best interest of the claimant.
(f)AAA settlement that is not approved or rejected before the
16th day after the date the settlement is submitted to the
commissioner is considered to be approved by the commissioner on
that date.
(g)AAA settlement takes effect on the date it is approved by
the commissioner.
(h)AAA party to a settlement may withdraw acceptance of the
settlement at any time before its effective date.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.081, eff.
September 1, 2005.
Sec.A408.006.AAMENTAL TRAUMA INJURIES. (a) It is the
express intent of the legislature that nothing in this subtitle
shall be construed to limit or expand recovery in cases of mental
trauma injuries.
(b)AAA mental or emotional injury that arises principally
12
from a legitimate personnel action, including a transfer,
promotion, demotion, or termination, is not a compensable injury
under this subtitle.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A408.007.AADATE OF INJURY FOR OCCUPATIONAL DISEASE. For
purposes of this subtitle, the date of injury for an occupational
disease is the date on which the employee knew or should have known
that the disease may be related to the employment.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A408.008.AACOMPENSABILITY OF HEART ATTACKS. A heart
attack is a compensable injury under this subtitle only if:
(1)AAthe attack can be identified as:
(A)AAoccurring at a definite time and place; and
(B)AAcaused by a specific event occurring in the
course and scope of the employee ’s employment;
(2)AAthe preponderance of the medical evidence
regarding the attack indicates that the employee ’s work rather than
the natural progression of a preexisting heart condition or disease
was a substantial contributing factor of the attack; and
(3)AAthe attack was not triggered solely by emotional
or mental stress factors, unless it was precipitated by a sudden
stimulus.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
SUBCHAPTER B. MEDICAL BENEFITS
Sec.A408.021.AAENTITLEMENT TO MEDICAL BENEFITS. (a) An
employee who sustains a compensable injury is entitled to all
health care reasonably required by the nature of the injury as and
when needed. The employee is specifically entitled to health care
that:
(1)AAcures or relieves the effects naturally resulting
from the compensable injury;
(2)AApromotes recovery; or
(3)AAenhances the ability of the employee to return to
13
or retain employment.
(b)AAMedical benefits are payable from the date of the
compensable injury.
(c)AAExcept in an emergency, all health care must be approved
or recommended by the employee ’s treating doctor.
(d)AAAn insurance carrier ’s liability for medical benefits
may not be limited or terminated by agreement or settlement.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A408.022.AASELECTION OF DOCTOR. (a) Except in an
emergency, the division shall require an employee to receive
medical treatment from a doctor chosen from a list of doctors
approved by the commissioner.AAA doctor may perform only those
procedures that are within the scope of the practice for which the
doctor is licensed.AAThe employee is entitled to the employee ’s
initial choice of a doctor from the division ’s list.
(b)AAIf an employee is dissatisfied with the initial choice
of a doctor from the division ’s list, the employee may notify the
division and request authority to select an alternate doctor.AAThe
notification must be in writing stating the reasons for the change,
except notification may be by telephone when a medical necessity
exists for immediate change.
(c)AAThe commissioner shall prescribe criteria to be used by
the division in granting the employee authority to select an
alternate doctor.AAThe criteria may include:
(1)AAwhether treatment by the current doctor is
medically inappropriate;
(2)AAthe professional reputation of the doctor;
(3)AAwhether the employee is receiving appropriate
medical care to reach maximum medical improvement; and
(4)AAwhether a conflict exists between the employee and
the doctor to the extent that the doctor-patient relationship is
jeopardized or impaired.
(d)AAA change of doctor may not be made to secure a new
impairment rating or medical report.
(e)AAFor purposes of this section, the following is not a
selection of an alternate doctor:
14
(1)AAa referral made by the doctor chosen by the
employee if the referral is medically reasonable and necessary;
(2)AAthe receipt of services ancillary to surgery;
(3)AAthe obtaining of a second or subsequent opinion
only on the appropriateness of the diagnosis or treatment;
(4)AAthe selection of a doctor because the original
doctor:
(A)AAdies;
(B)AAretires; or
(C)AAbecomes unavailable or unable to provide
medical care to the employee; or
(5)AAa change of doctors required because of a change of
residence by the employee.
(f)AAThis section does not apply to requirements regarding
the selection of a doctor under a workers ’ compensation health care
network established under Chapter 1305, Insurance Code, except as
provided by that chapter.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.082, eff.
September 1, 2005.
Sec. 408.0221.AAREQUEST FOR DESCRIPTION OF EMPLOYMENT. (a)
This section applies only to an employee of an employer who has 10
or more employees.
(b)AATo facilitate an injured employee ’s return to
employment as soon as it is considered safe and appropriate by the
injured employee ’s treating doctor, the treating doctor may request
that the injured employee ’s employer provide the treating doctor
with the information described by Subsection (d) on the form
adopted under that subsection.
(c)AAInformation provided to a treating doctor under
Subsection (b) does not constitute:
(1)AAa request by the employer that the injured
employee return to the employment;
(2)AAan offer of employment by the employer for the
injured employee to return to employment; or
15
(3)AAan admission of the compensability of the injury
of the employee.
(d)AAThe commissioner shall prescribe a form to provide
information from an employer to a treating doctor concerning the
functions and physical responsibilities of an injured employee ’s
job.AATo the extent possible, the form prescribed under this
subsection shall be one page, use a check box format as appropriate,
and be compatible with electronic mail.AAThe form must include:
(1)AAthe name and address of the employer and the
contact information and availability of the individual
representing the employer who has knowledge of the injured
employee ’s job;
(2)AAthe scope of the injured employee ’s employment,
including any specific tasks, job duties, or work activities that
the injured employee was required to perform at the time the
employee sustained the injury; and
(3)AAan area for additional comments or informationAAby
the employer or individual representing the employer concerning:
(A)AAthe injured employee ’s job; or
(B)AAthe availability, if any, of other jobs that
the employer may have that the employer would like the treating
doctor to consider in determining whether an injured employee is
able to return to work.
(e)AAThe commissioner may adopt rules as necessary to
implement this section and to facilitate communication between the
employer and the treating doctor regarding return-to-work
opportunities.
Added by Acts 2009, 81st Leg., R.S., Ch. 456 (H.B. 2547), Sec. 1,
eff. September 1, 2009.
Sec. 408.023.AALIST OF APPROVED DOCTORS; DUTIES OF TREATING
DOCTORS. (a) The division shall develop a list of doctors licensed
in this state who are approved to provide health care services under
this subtitle.AAA doctor is eligible to be included on the
division ’s list of approved doctors if the doctor:
(1)AAregisters with the division in the manner
prescribed by commissioner rules; and
16
(2)AAcomplies with the requirements adopted by the
commissioner under this section.
(b)AAThe commissioner by rule shall establish reasonable
requirements for training for doctors as a prerequisite for
inclusion on the list.AAExcept as otherwise provided by this
section, the requirements adopted under this subsection apply to
doctors and other health care providers who:
(1)AAprovide health care services as treating doctors;
(2)AAprovide health care services as authorized by this
chapter;
(3)AAperform medical peer review under this subtitle;
(4)AAperform utilization review of medical benefits
provided under this subtitle; or
(5)AAprovide health care services on referral from a
treating doctor, as provided by commissioner rule.
(c)AAThe division shall issue to a doctor who is approved by
the commissioner a certificate of registration.AAIn determining
whether to issue a certificate of registration, the commissioner
may consider and condition approval on any practice restrictions
applicable to the applicant that are relevant to services provided
under this subtitle.AAThe commissioner may also consider the
practice restrictions of an applicant when determining appropriate
sanctions under Section 408.0231.
(d)AAA certificate of registration issued under this section
is valid, unless revoked, suspended, or revised, for the period
provided by commissioner rule and may be renewed on application to
the division.AAThe division shall provide notice to each doctor on
the approved doctor list of the pending expiration of the doctor ’s
certificate of registration not later than the 60th day before the
date of expiration of the certificate.
(e)AANotwithstanding other provisions of this section, a
doctor not licensed in this state but licensed in another state or
jurisdiction who treats employees or performs utilization review of
health care for an insurance carrier may apply for a certificate of
registration under this section to be included on the division ’s
list of approved doctors.
(f)AAExcept in an emergency or for immediate post-injury
17
medical care as defined by commissioner rule, or as provided by
Subsection (h), (i), or (j), each doctor who performs functions
under this subtitle, including examinations under this chapter,
must hold a certificate of registration and be on the division ’s
list of approved doctors in order to perform services or receive
payment for those services.
(g)AAThe commissioner by rule shall modify registration and
training requirements for doctors who infrequently provide health
care or who perform utilization review or peer review functions for
insurance carriers as necessary to ensure that those doctors are
informed of the regulations that affect health care benefit
delivery under this subtitle.
(h)AANotwithstanding Section 4201.152, Insurance Code, a
utilization review agent or an insurance carrier that uses doctors
to perform reviews of health care services provided under this
subtitle, including utilization review, may only use doctors
licensed to practice in this state.
(i)AAThe commissioner may grant exceptions to the
requirement imposed under Subsection (f) as necessary to ensure
that:
(1)AAemployees have access to health care; and
(2)AAinsurance carriers have access to evaluations of
an employee ’s health care and income benefit eligibility as
provided by this subtitle.
(j)AAA doctor who contracts with a workers ’ compensation
health care network certified under Chapter 1305, Insurance Code,
is not subject to the registration requirements of Subsections
(a)-(i) for the purpose of providing health care services under
that network contract.AAThe doctor is subject to the requirements
of Subsections (l)-(p), and Subsection (q) applies to health care
services and functions provided by a doctor who contracts with a
certified workers ’ compensation health care network.
(k)AAThe requirements of Subsections (a)-(g) and Subsection
(i) expire September 1, 2007.AABefore that date, the commissioner
may waive the application of the provisions of Subsections (a)-(g)
and Subsection (i) that require doctors to hold a certificate of
registration and to be on the list of approved doctors if the
18
commissioner determines that:
(1)AAinjured employees have adequate access to health
care providers who are willing to treat injured employees for
compensable injuries through workers ’ compensation health care
networks certified under Chapter 1305, Insurance Code; or
(2)AAinjured employees who are not covered by a workers ’
compensation health care network certified under Chapter 1305,
Insurance Code, do not have adequate access to health care
providers who are willing to treat injured employees for
compensable injuries.
(l)AAThe injured employee ’s treating doctor is responsible
for the efficient management of medical care as required by Section
408.025(c) and commissioner rules.AAThe division shall collect
information regarding:
(1)AAreturn-to-work outcomes;
(2)AApatient satisfaction; and
(3)AAcost and utilization of health care provided or
authorized by a treating doctor on the list of approved doctors.
(m)AAThe commissioner may adopt rules to define the role of
the treating doctor and to specify outcome information to be
collected for a treating doctor.
(n)AAThe commissioner by rule shall establish reasonable
requirements for doctors, and health care providers financially
related to those doctors, regarding training, impairment rating
testing, and disclosure of financial interests as required by
Section 413.041, and for monitoring of those doctors and health
care providers as provided by Sections 408.0231, 413.0511, and
413.0512.
(o)AAA doctor, including a doctor who contracts with a
workers ’ compensation health care network, shall:
(1)AAcomply with the requirements established by
commissioner rule under Subsections (l) and (m) and with Section
413.041 regarding the disclosure of financial interests; and
(2)AAif the doctor intends to provide certifications of
maximum medical improvement or assign impairment ratings, comply
with the impairment rating training and testing requirements
established by commissioner rule under Subsection (n).
19
(p)AAA person required to comply with Subsection (o),
including a doctor who contracts with a workers ’ compensation
health care network, who does not comply with that section commits
an administrative violation.
(q)AAAn insurance carrier may not use, for the purpose of
suspending temporary income benefits or computing impairment
income benefits, a certification of maximum medical improvement or
an impairment rating assigned by a doctor, including a doctor who
contracts with a workers ’ compensation health care network
certified under Chapter 1305, Insurance Code, who fails to comply
with Subsection (o)(2).
(r)AANotwithstanding the waiver or expiration of Subsections
(a)-(g) and (i), there may be no direct or indirect provision of
health care under this subtitle and rules adopted under this
subtitle, and no direct or indirect receipt of remuneration under
this subtitle and rules adopted under this subtitle by a doctor who:
(1)AAbefore September 1, 2007:
(A)AAwas removed or deleted from the list of
approved doctors either by action of the Texas Workers ’
Compensation Commission or the division or by agreement with the
doctor;
(B)AAwas not admitted to the list of approved
doctors either by action of the Texas Workers ’ Compensation
Commission or the division or by agreement with the doctor;
(C)AAwas suspended from the list of approved
doctors either by action of the Texas Workers ’ Compensation
Commission or the division or by agreement with the doctor; or
(D)AAhad the doctor ’s license to practice
suspended by the appropriate licensing agency, including a
suspension that was stayed, deferred, or probated, or voluntarily
relinquished the license to practice; and
(2)AAwas not reinstated or restored by the Texas
Workers ’ Compensation Commission or the division to the list of
approved doctors before September 1, 2007.
(s)AAThe waiver or expiration of Subsections (a)-(g) and (i)
do not limit the division ’s ability to impose sanctions as provided
by this subtitle and commissioner rules.
20
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1995, 74th Leg., ch. 980, Sec. 1.25, eff. Sept. 1, 1995;
Acts 2001, 77th Leg., ch. 1456, Sec. 1.01, eff. Sept. 1, 2001.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.083, eff.
September 1, 2005.
Acts 2007, 80th Leg., R.S., Ch. 134 (H.B. 1006), Sec. 2, eff.
September 1, 2007.
Acts 2009, 81st Leg., R.S., Ch. 1330 (H.B. 4290), Sec. 17,
eff. September 1, 2009.
Sec. 408.0231.AAMAINTENANCE OF LIST OF APPROVED DOCTORS;
SANCTIONS AND PRIVILEGES RELATING TO HEALTH CARE. (a) The
commissioner shall delete from the list of approved doctors a
doctor:
(1)AAwho fails to register with the division as
provided by this chapter and commissioner rules;
(2)AAwho is deceased;
(3)AAwhose license to practice in this state is
revoked, suspended, or not renewed by the appropriate licensing
authority; or
(4)AAwho requests to be removed from the list.
(b)AAThe commissioner by rule shall establish criteria for:
(1)AAdeleting or suspending a doctor from the list of
approved doctors;
(2)AAimposing sanctions on a doctor or an insurance
carrier as provided by this section;
(3)AAmonitoring of utilization review agents, as
provided by a memorandum of understanding between the division and
the Texas Department of Insurance; and
(4)AAauthorizing increased or reduced utilization
review and preauthorization controls on a doctor.
(c)AARules adopted under Subsection (b) are in addition to,
and do not affect, the rules adopted under Section 415.023(b).AAThe
criteria for deleting a doctor from the list or for recommending or
imposing sanctions may include anything the commissioner considers
relevant, including:
21
(1)AAa sanction of the doctor by the commissioner for a
violation of Chapter 413 or Chapter 415;
(2)AAa sanction by the Medicare or Medicaid program
for:
(A)AAsubstandard medical care;
(B)AAovercharging;
(C)AAoverutilization of medical services; or
(D)AAany other substantive noncompliance with
requirements of those programs regarding professional practice or
billing;
(3)AAevidence from the division ’s medical records that
the applicable insurance carrier ’s utilization review practices or
the doctor ’s charges, fees, diagnoses, treatments, evaluations, or
impairment ratings are substantially different from those the
commissioner finds to be fair and reasonable based on either a
single determination or a pattern of practice;
(4)AAa suspension or other relevant practice
restriction of the doctor ’s license by an appropriate licensing
authority;
(5)AAprofessional failure to practice medicine or
provide health care, including chiropractic care, in an acceptable
manner consistent with the public health, safety, and welfare;
(6)AAfindings of fact and conclusions of law made by a
court, an administrative law judge of the State Office of
Administrative Hearings, or a licensing or regulatory authority; or
(7)AAa criminal conviction.
(d)AAThe commissioner by rule shall establish procedures
under which a doctor may apply for:
(1)AAreinstatement to the list of approved doctors; or
(2)AArestoration of doctor practice privileges removed
by the commissioner based on sanctions imposed under this section.
(e)AAThe commissioner shall act on a recommendation by the
medical advisor selected under Section 413.0511 and, after notice
and the opportunity for a hearing, may impose sanctions under this
section on a doctor or an insurance carrier or may recommend action
regarding a utilization review agent.AAThe commissioner and the
commissioner of insurance shall enter into a memorandum of
22
understanding to coordinate the regulation of insurance carriers
and utilization review agents as necessary to ensure:
(1)AAcompliance with applicable regulations; and
(2)AAthat appropriate health care decisions are reached
under this subtitle and under Chapter 4201, Insurance Code.
(f)AAThe sanctions the commissioner may recommend or impose
under this section include:
(1)AAreduction of allowable reimbursement;
(2)AAmandatory preauthorization of all or certain
health care services;
(3)AArequired peer review monitoring, reporting, and
audit;
(4)AAdeletion or suspension from the approved doctor
list and the designated doctor list;
(5)AArestrictions on appointment under this chapter;
(6)AAconditions or restrictions on an insurance carrier
regarding actions by insurance carriers under this subtitle in
accordance with the memorandum of understanding adopted under
Subsection (e); and
(7)AAmandatory participation in training classes or
other courses as established or certified by the division.
(g)AAThe commissioner shall adopt rules regarding doctors
who perform peer review functions for insurance carriers.AAThose
rules may include standards for peer review, imposition of
sanctions on doctors performing peer review functions, including
restriction, suspension, or removal of the doctor ’s ability to
perform peer review on behalf of insurance carriers in the workers ’
compensation system, and other issues important to the quality of
peer review, as determined by the commissioner.AAA doctor who
performs peer review under this subtitle must hold the appropriate
professional license issued by this state.AAA doctor, other than a
chiropractor or a dentist, who performs peer review is subject to
Section 408.0043.AAA dentist who performs a peer review of a dental
service provided to an injured employee is subject to Section
408.0044.AAA chiropractor who performs a peer review of a
chiropractic service provided to an injured employee is subject to
Section 408.0045.
23
Added by Acts 2001, 77th Leg., ch. 1456, Sec. 1.01, eff. June 17,
2001.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.084, eff.
September 1, 2005.
Acts 2007, 80th Leg., R.S., Ch. 134 (H.B. 1006), Sec. 3, eff.
September 1, 2007.
Acts 2007, 80th Leg., R.S., Ch. 1218 (H.B. 2004), Sec. 4, eff.
September 1, 2007.
Sec. 408.024.AANONCOMPLIANCE WITH SELECTION REQUIREMENTS.
Except as otherwise provided, and after notice and an opportunity
for hearing, the commissioner may relieve an insurance carrier of
liability for health care that is furnished by a health care
provider or another person selected in a manner inconsistent with
the requirements of this subchapter.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.085, eff.
September 1, 2005.
Sec.A408.025.AAREPORTS AND RECORDS REQUIRED FROM HEALTH CARE
PROVIDERS. (a) The commissioner by rule shall adopt requirements
for reports and records that are required to be filed with the
division or provided to the injured employee, the employee ’s
attorney, or the insurance carrier by a health care provider.
(b)AAThe commissioner by rule shall adopt requirements for
reports and records that are to be made available by a health care
provider to another health care provider to prevent unnecessary
duplication of tests and examinations.
(c)AAThe treating doctor is responsible for maintaining
efficient utilization of health care.
(d)AAOn the request of an injured employee, the employee ’s
attorney, or the insurance carrier, a health care provider shall
furnish records relating to treatment or hospitalization for which
compensation is being sought.AAThe division may regulate the charge
for furnishing a report or record, but the charge may not be less
24
than the fair and reasonable charge for furnishing the report or
record.AAA health care provider may disclose to the insurance
carrier of an affected employer records relating to the diagnosis
or treatment of the injured employee without the authorization of
the injured employee to determine the amount of payment or the
entitlement to payment.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1999, 76th Leg., ch. 1426, Sec. 9, eff. Sept. 1, 1999.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.086, eff.
September 1, 2005.
Sec. 408.0251.AAELECTRONIC BILLING REQUIREMENTS. (a) The
commissioner, by rule and in cooperation with the commissioner of
insurance, shall adopt rules regarding the electronic submission
and processing of medical bills by health care providers to
insurance carriers.
(b)AAInsurance carriers shall accept medical bills submitted
electronically by health care providers in accordance with
commissioner rule.
(c)AAThe commissioner shall by rule establish criteria for
granting exceptions to insurance carriers and health care providers
who are unable to submit or accept medical bills electronically.
(d)AAOn or after January 1, 2008, the commissioner may adopt
rules regarding the electronic payment of medical bills by
insurance carriers to health care providers.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.087, eff.
September 1, 2005.
Sec. 408.0252.AAUNDERSERVED AREAS. The commissioner by rule
may identify areas of this state in which access to health care
providers is less available and may adopt appropriate standards,
guidelines, and rules regarding the delivery of health care in
those areas.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.087, eff.
September 1, 2005.
25
Sec. 408.026.AASPINAL SURGERY. Except in a medical
emergency, an insurance carrier is liable for medical costs related
to spinal surgery only as provided by Section 413.014 and
commissioner rules.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 2001, 77th Leg., ch. 1456, Sec. 4.01, eff. June 17, 2001.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.088, eff.
September 1, 2005.
Sec. 408.027.AAPAYMENT OF HEALTH CARE PROVIDER. (a) A
health care provider shall submit a claim for payment to the
insurance carrier not later than the 95th day after the date on
which the health care services are provided to the injured
employee.AAFailure by the health care provider to timely submit a
claim for payment constitutes a forfeiture of the provider ’s right
to reimbursement for that claim for payment.
(b)AAThe insurance carrier must pay, reduce, deny, or
determine to audit the health care provider ’s claim not later than
the 45th day after the date of receipt by the carrier of the
provider ’s claim.AAThe carrier may request additional
documentation necessary to clarify the provider ’s charges at any
time during the 45-day period.AAIf the insurance carrier requests
additional documentation under this subsection, the health care
provider must provide the requested documentation not later than
the 15th day after the date of receipt of the carrier ’s request.AAIf
the insurance carrier elects to audit the claim, the carrier must
complete the audit not later than the 160th day after the date of
receipt by the carrier of the health care provider ’s claim, and, not
later than the 160th day after the receipt of the claim, must make a
determination regarding the relationship of the health care
services provided to the compensable injury, the extent of the
injury, and the medical necessity of the services provided.AAIf the
insurance carrier chooses to audit the claim, the insurance carrier
must pay to the health care provider not later than the 45th day
after the date of receipt by the carrier of the provider ’s claim 85
percent of:
26
(1)AAthe amount for the health care service established
under the fee guidelines authorized under this subtitle if the
health care service is not provided through a workers ’ compensation
health care network under Chapter 1305, Insurance Code; or
(2)AAthe amount of the contracted rate for that health
care service if the health care service is provided through a
workers ’ compensation health care network under Chapter 1305,
Insurance Code.
(c)AAIf the health care services provided are determined to
be appropriate, the insurance carrier shall pay the health care
provider the remaining 15 percent of the claim not later than the
160th day after the date of receipt by the carrier of the health
care provider ’s documentation of the claim.AAAn insurance carrier
commits an administrative violation if the carrier, in violation of
Subsection (b), fails to:
(1)AApay, reduce, deny, or notify the health care
provider of the intent to audit the claim by the 45th day after the
date of receipt by the carrier of the health care provider ’s claim;
or
(2)AApay, reduce, or deny an audited claim by the 160th
day after the date of receipt of the claim.
(d)AAIf an insurance carrier contests the compensability of
an injury and the injury is determined not to be compensable, the
carrier may recover the amounts paid for health care services from
the employee ’s accident or health benefit plan, or any other person
who may be obligated for the cost of the health care services.AAIf
an accident or health insurance carrier or other person obligated
for the cost of health care services has paid for health care
services for an employee for an injury for which a workers ’
compensation insurance carrier denies compensability, and the
injury is later determined to be compensable, the accident or
health insurance carrier or other person may recover the amounts
paid for such services from the workers ’ compensation insurance
carrier.AAIf an accident or health insurance carrier or other
person obligated for the cost of health care services has paid for
health care services for an employee for an injury for which the
workers ’ compensation insurance carrier or the employer has not
27
disputed compensability, the accident or health insurance carrier
or other person may recover reimbursement from the insurance
carrier in the manner described by Section 409.009 or 409.0091, as
applicable.
(e)AAIf an insurance carrier disputes the amount of payment
or the health care provider ’s entitlement to payment, the insurance
carrier shall send to the division, the health care provider, and
the injured employee a report that sufficiently explains the
reasons for the reduction or denial of payment for health care
services provided to the employee.AAThe insurance carrier is
entitled to a hearing as provided by Section 413.031(d).
(f)AAExcept as provided by Section 408.0281 or 408.0284, any
payment made by an insurance carrier under this section shall be in
accordance with the fee guidelines authorized under this subtitle
if the health care service is not provided through a workers ’
compensation health care network under Chapter 1305, Insurance
Code, or at a contracted rate for that health care service if the
health care service is provided through a workers ’ compensation
health care network under Chapter 1305, Insurance Code.
(g)AANotwithstanding any other provision in this subtitle or
Chapter 1305, Insurance Code, this section and Section 408.0271
apply to health care provided through a workers ’ compensation
health care network established under Chapter 1305, Insurance
Code.AAThe commissioner shall adopt rules as necessary to implement
the provisions of this section and Section 408.0271.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1999, 76th Leg., ch. 1426, Sec. 10, eff. Sept. 1, 1999.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.089, eff.
September 1, 2005.
Acts 2007, 80th Leg., R.S., Ch. 1007 (H.B. 724), Sec. 4, eff.
September 1, 2007.
Acts 2011, 82nd Leg., R.S., Ch. 705 (H.B. 528), Sec. 1, eff.
June 17, 2011.
Acts 2013, 83rd Leg., R.S., Ch. 1202 (S.B. 1322), Sec. 1, eff.
September 1, 2013.
28
Sec. 408.0271.AAREIMBURSEMENT BY HEALTH CARE PROVIDER. (a)
If the health care services provided to an injured employee are
determined by the insurance carrier to be inappropriate, the
insurance carrier shall:
(1)AAnotify the health care provider in writing of the
carrier ’s decision; and
(2)AAdemand a refund by the health care provider of the
portion of payment on the claim that was received by the health care
provider for the inappropriate services.
(b)AAThe health care provider may appeal the insurance
carrier ’s determination under Subsection (a).AAThe health care
provider must file an appeal under this subsection with the
insurance carrier not later than the 45th day after the date of the
insurance carrier ’s request for the refund.AAThe insurance carrier
must act on the appeal not later than the 45th day after the date on
which the provider files the appeal.
(c)AAA health care provider shall reimburse the insurance
carrier for payments received by the provider for inappropriate
charges not later than the 45th day after the date of the carrier ’s
notice.AAThe failure by the health care provider to timely remit
payment to the carrier constitutes an administrative violation.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.0895, eff.
September 1, 2005.
Sec. 408.0272.AACERTAIN EXCEPTIONS FOR UNTIMELY SUBMISSION
OF CLAIM. (a) In this section:
(1)AA"Group accident and health insurance" has the
meaning assigned by Chapter 1251, Insurance Code.
(2)AA"Health maintenance organization" has the meaning
assigned by Chapter 843, Insurance Code.
(b)AANotwithstanding Section 408.027, a health care provider
who fails to timely submit a claim for payment to the insurance
carrier under Section 408.027(a) does not forfeit the provider ’s
right to reimbursement for that claim for payment solely for
failure to submit a timely claim if:
(1)AAthe provider submits proof satisfactory to the
commissioner that the provider, within the period prescribed by
29
Section 408.027(a), erroneously filed for reimbursement with:
(A)AAan insurer that issues a policy of group
accident and health insurance under which the injured employee is a
covered insured;
(B)AAa health maintenance organization that
issues an evidence of coverage under which the injured employee is a
covered enrollee; or
(C)AAa workers ’ compensation insurance carrier
other than the insurance carrier liable for the payment of benefits
under this title; or
(2)AAthe commissioner determines that the failure
resulted from a catastrophic event that substantially interfered
with the normal business operations of the provider.
(c)AANotwithstanding Subsection (b), a health care provider
who erroneously submits a claim for payment to an entity described
by Subdivision (1) of that subsection forfeits the provider ’s right
to reimbursement for that claim if the provider fails to submit the
claim to the correct workers ’ compensation insurance carrier within
95 days after the date the provider is notified of the provider ’s
erroneous submission of the claim.
(d)AANotwithstanding any other provision of this section or
Section 408.027, the period for submitting a claim for payment may
be extended by agreement of the parties.
Added by Acts 2007, 80th Leg., R.S., Ch. 459 (H.B. 1005), Sec. 1,
eff. September 1, 2007.
Sec.A408.028.AAPHARMACEUTICAL SERVICES. (a) A physician
providing care to an employee under this subchapter shall prescribe
for the employee any necessary prescription drugs, and order
over-the-counter alternatives to prescription medications as
clinically appropriate and applicable, in accordance with
applicable state law and as provided by Subsection (b). A doctor
providing care may order over-the-counter alternatives to
prescription medications, when clinically appropriate, in
accordance with applicable state law and as provided by Subsection
(b).
(b)AAThe commissioner by rule shall require the use of
30
generic pharmaceutical medications and clinically appropriate
over-the-counter alternatives to prescription medications unless
otherwise specified by the prescribing doctor, in accordance with
applicable state law.AAThe commissioner by rule shall adopt a
closed formulary under Section 413.011.AARules adopted by the
commissioner shall allow an appeals process for claims in which a
treating doctor determines and documents that a drug not included
in the formulary is necessary to treat an injured employee ’s
compensable injury.
(c)AAExcept as otherwise provided by this subtitle, an
insurance carrier may not require an employee to use pharmaceutical
services designated by the carrier.
(d)AAThe commissioner shall adopt rules to allow an employee
to purchase over-the-counter alternatives to prescription
medications prescribed or ordered under Subsection (a) or (b) and
to obtain reimbursement from the insurance carrier for those
medications.
(e)AANotwithstanding Subsection (b), the commissioner by
rule shall allow an employee to purchase a brand name drug rather
than a generic pharmaceutical medication or over-the-counter
alternative to a prescription medication if a health care provider
prescribes a generic pharmaceutical medication or an
over-the-counter alternative to a prescription medication.AAThe
employee shall be responsible for paying the difference between the
cost of the brand name drug and the cost of the generic
pharmaceutical medication or of an over-the-counter alternative to
a prescription medication.AAThe employee may not seek
reimbursement for the difference in cost from an insurance carrier
and is not entitled to use the medical dispute resolution
provisions of Chapter 413 with regard to the prescription.AAA
payment described by this subsection by an employee to a health care
provider does not violate Section 413.042.AAThis subsection does
not affect the duty of a health care provider to comply with the
requirements of Subsection (b) when prescribing medications or
ordering over-the-counter alternatives to prescription
medications.
(f)AANotwithstanding any other provision of this title, the
31
commissioner by rule shall adopt a fee schedule for pharmacy and
pharmaceutical services that will:
(1)AAprovide reimbursement rates that are fair and
reasonable;
(2)AAassure adequate access to medications and services
for injured workers;
(3)AAminimize costs to employees and insurance
carriers; and
(4)AAtake into consideration the increased security of
payment afforded by this subtitle.
(g)AASection 413.011(d) and the rules adopted to implement
that subsection do not apply to the fee schedule adopted by the
commissioner under Subsection (f).
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 2001, 77th Leg., ch. 1456, Sec. 6.01, eff. June 17, 2001;
Acts 2003, 78th Leg., ch. 468, Sec. 1, eff. Sept. 1, 2003.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.090, eff.
September 1, 2005.
Acts 2011, 82nd Leg., R.S., Ch. 705 (H.B. 528), Sec. 2, eff.
June 17, 2011.
Sec. 408.0281.AAREIMBURSEMENT FOR PHARMACEUTICAL SERVICES;
ADMINISTRATIVE VIOLATION. (a)AAIn this section:
(1)AA"Informal network" means a network that:
(A)AAis established under a contract between an
insurance carrier or an insurance carrier ’s authorized agent and a
health care provider for the provision of pharmaceutical services;
and
(B)AAincludes a specific fee schedule.
(2)AA"Voluntary network" means a voluntary workers ’
compensation health care delivery network established under former
Section 408.0223, as that section existed before repeal by Chapter
265 (H.B. 7), Acts of the 79th Legislature, Regular Session, 2005,
by an insurance carrier for the provision of pharmaceutical
services.
(b)AANotwithstanding any provision of Chapter 1305,
32
Insurance Code, or Section 504.053 of this code, prescription
medication or services, as defined by Section 401.011(19)(E):
(1)AAmay be reimbursed in accordance with the fee
guidelines adopted by the commissioner or at a contract rate in
accordance with this section; and
(2)AAmay not be delivered through:
(A)AAa workers ’ compensation health care network
under Chapter 1305, Insurance Code; or
(B)AAa contract described by Section
504.053(b)(2).
(c)AANotwithstanding any other provision of this title,
including Section 408.028(f), or any provision of Chapter 1305,
Insurance Code, an insurance carrier may pay a health care provider
fees for pharmaceutical services that are inconsistent with the fee
guidelines adopted by the commissioner only if the carrier has a
contract with the health care provider and that contract includes a
specific fee schedule.AAAn insurance carrier or the carrier ’s
authorized agent may use an informal or voluntary network to obtain
a contractual agreement that provides for fees different from the
fees authorized under the fee guidelines adopted by the
commissioner for pharmaceutical services.AAIf a carrier or the
carrier ’s authorized agent chooses to use an informal or voluntary
network to obtain a contractual fee arrangement, there must be a
contractual arrangement between:
(1)AAthe carrier or authorized agent and the informal
or voluntary network that authorizes the network to contract with
health care providers for pharmaceutical services on the carrier ’s
behalf; and
(2)AAthe informal or voluntary network and the health
care provider that includes a specific fee schedule and complies
with the notice requirements of this section.
(d)AAAn informal or voluntary network, or the carrier or the
carrier ’s authorized agent, as appropriate, shall, at least
quarterly, notify each health care provider of any person, other
than an injured employee, to which the network ’s contractual fee
arrangements with the health care provider are sold, leased,
transferred, or conveyed.AANotice to each health care provider:
33
(1)AAmust include:
(A)AAthe contact information for the network,
including the name, physical address, and toll-free telephone
number at which a health care provider with which the network has a
contract may contact the network; and
(B)AAin the body of the notice:
(i)AAthe name, physical address, and
telephone number of any person, other than an injured employee, to
which the network ’s contractual fee arrangement with the health
care provider is sold, leased, transferred, or conveyed; and
(ii)AAthe start date and any end date of the
period during which any person, other than an injured employee, to
which the network ’s contractual fee arrangement with the health
care provider is sold, leased, transferred, or conveyed; and
(2)AAmay be provided:
(A)AAin an electronic format, if a paper version
is available on request by the division; and
(B)AAthrough an Internet website link, but only if
the website:
(i)AAcontains the information described by
Subdivision (1); and
(ii)AAis updated at least monthly with
current and correct information.
(e)AAAn informal or voluntary network, or the carrier or the
carrier ’s authorized agent, as appropriate, shall document the
delivery of the notice required under Subsection (d), including the
method of delivery, to whom the notice was delivered, and the date
of delivery.AAFor purposes of Subsection (d), a notice is
considered to be delivered on, as applicable:
(1)AAthe fifth day after the date the notice is mailed
via United States Postal Service; or
(2)AAthe date the notice is faxed or electronically
delivered.
(f)AAAn insurance carrier, or the carrier ’s authorized agent
or an informal or voluntary network at the carrier ’s request, shall
provide copies of each contract described by Subsection (c) to the
division on the request of the division.AAInformation included in a
34
contract under Subsection (c) is confidential and is not subject to
disclosure under Chapter 552, Government Code.AANotwithstanding
Subsection (c), the insurance carrier may be required to pay fees in
accordance with the division ’s fee guidelines if:
(1)AAthe contract:
(A)AAis not provided to the division on the
division ’s request;
(B)AAdoes not include a specific fee schedule
consistent with Subsection (c); or
(C)AAdoes not clearly state that the contractual
fee arrangement is between the health care provider and the named
insurance carrier or the carrier ’s authorized agent; or
(2)AAthe carrier or the carrier ’s authorized agent does
not comply with the notice requirements under Subsection (d).
(g)AAFailure to provide documentation described by
Subsection (e) to the division on the request of the division or
failure to provide notice as required under Subsection (d) creates
a rebuttable presumption in an enforcement action under this
subtitle and in a medical fee dispute under Chapter 413 that a
health care provider did not receive the notice.
(h)AAAn insurance carrier or the carrier ’s authorized agent
commits an administrative violation if the carrier or agent
violates any provision of this section.AAAny administrative
penalty assessed under this subsection shall be assessed against
the carrier, regardless of whether the carrier or agent committed
the violation.
(i)AANotwithstanding Section 1305.003(b), Insurance Code, in
the event of a conflict between this section and Section 413.016 or
any other provision of Chapter 413 of this code or Chapter 1305,
Insurance Code, this section prevails.
Added by Acts 2011, 82nd Leg., R.S., Ch. 705 (H.B. 528), Sec. 3,
eff. June 17, 2011.
Sec. 408.0282.AAREQUIREMENTS FOR CERTAIN INFORMAL OR
VOLUNTARY NETWORKS. (a)AAEach informal or voluntary network
described by Section 408.0281 or 408.0284 shall, not later than the
30th day after the date the network is established, report the
35
following information to the division:
(1)AAthe name of the informal or voluntary network and
federal employer identification number;
(2)AAan executive contact for official correspondence
for the informal or voluntary network;
(3)AAa toll-free telephone number by which a health
care provider may contact the informal or voluntary network;
(4)AAa list of each insurance carrier with whom the
informal or voluntary network contracts, including the carrier ’s
federal employer identification number; and
(5)AAa list of, and contact information for, each
entity with which the informal or voluntary network has a contract
or other business relationship that benefits or is entered into on
behalf of an insurance carrier, including an insurance carrier ’s
authorized agent or a subsidiary or other affiliate of the network.
(b)AAEach informal or voluntary network shall report any
changes to the information provided under Subsection (a) to the
division not later than the 30th day after the effective date of the
change.
(c)AAAn informal or voluntary network shall submit a report
required under this section, including a report of changes required
under Subsection (b), to the division through the division ’s online
reporting system available through the division ’s Internet
website.
(d)AAAn informal or voluntary network commits an
administrative violation if the informal or voluntary network
violates any provision of this section.
Added by Acts 2011, 82nd Leg., R.S., Ch. 705 (H.B. 528), Sec. 3,
eff. June 17, 2011.
Amended by:
Acts 2013, 83rd Leg., R.S., Ch. 1202 (S.B. 1322), Sec. 2, eff.
September 1, 2013.
Sec. 408.0284.AAREIMBURSEMENT FOR DURABLE MEDICAL EQUIPMENT
AND HOME HEALTH CARE SERVICES; ADMINISTRATIVE VIOLATION. (a)AAIn
this section:
(1)AA"Durable medical equipment" includes prosthetics
36
and orthotic devices and related medical equipment and
supplies.AAThe term does not include:
(A)AAan object or device that is surgically
implanted, embedded, inserted, or otherwise applied;
(B)AArelated equipment necessary to operate,
program, or recharge the object or device described by Paragraph
(A); or
(C)AAan intrathecal pump.
(2)AA"Informal network" means a network that:
(A)AAis established under a contract between an
insurance carrier or an insurance carrier ’s authorized agent and a
health care provider for the provision of durable medical equipment
or home health care services; and
(B)AAincludes a specific fee schedule.
(3)AA"Voluntary network" means a voluntary workers ’
compensation health care delivery network established under former
Section 408.0223, as that section existed before repeal by Chapter
265 (House Bill No. 7), Acts of the 79th Legislature, Regular
Session, 2005, by an insurance carrier for the provision of durable
medical equipment or home health care services.
(b)AANotwithstanding any provision of Chapter 1305,
Insurance Code, or Section 504.053 of this code, durable medical
equipment and home health care services may be reimbursed in
accordance with the fee guidelines adopted by the commissioner or
at a voluntarily negotiated contract rate in accordance with this
section.
(c)AANotwithstanding any other provision of this title or any
provision of Chapter 1305, Insurance Code, an insurance carrier may
pay a health care provider fees for durable medical equipment or
home health care services that are inconsistent with the fee
guidelines adopted by the commissioner only if the carrier or the
carrier ’s authorized agent has a contract with the health care
provider and that contract includes a specific fee schedule.AAAn
insurance carrier or the carrier ’s authorized agent may use an
informal or voluntary network to obtain a contractual agreement
that provides for fees different from the fees authorized under the
fee guidelines adopted by the commissioner for durable medical
37
equipment or home health care services.AAIf a carrier or the
carrier ’s authorized agent chooses to use an informal or voluntary
network to obtain a contractual fee arrangement, there must be a
contractual arrangement between:
(1)AAthe carrier or authorized agent and the informal
or voluntary network that authorizes the network to contract with
health care providers for durable medical equipment or home health
care services on the carrier ’s behalf; and
(2)AAthe informal or voluntary network and the health
care provider that includes a specific fee schedule and complies
with the notice requirements of this section.
(d)AAAn informal or voluntary network, or the carrier or the
carrier ’s authorized agent shall, at least quarterly, notify each
health care provider of any person, other than an injured employee,
to which the network ’s contractual fee arrangements with the health
care provider are sold, leased, transferred, or conveyed.AANotice
to each health care provider:
(1)AAmust include:
(A)AAthe contact information for the network,
including the name, physical address, and toll-free telephone
number at which a health care provider with which the network has a
contract may contact the network; and
(B)AAin the body of the notice:
(i)AAthe name, physical address, and
telephone number of any person, other than an injured employee, to
which the network ’s contractual fee arrangement with the health
care provider is sold, leased, transferred, or conveyed; and
(ii)AAthe start date and any end date of the
period during which the network ’s contractual fee arrangement with
the health care provider is sold, leased, transferred, or conveyed;
and
(2)AAmay be provided:
(A)AAin an electronic format, if a paper version
is available on request by the division; and
(B)AAthrough an Internet website link, but only if
the website:
(i)AAcontains the information described by
38
Subdivision (1); and
(ii)AAis updated at least monthly with
current and correct information.
(e)AAAn informal or voluntary network, or the carrier or the
carrier ’s authorized agent, as appropriate, shall document the
delivery of the notice required under Subsection (d), including the
method of delivery, to whom the notice was delivered, and the date
of delivery.AAFor purposes of Subsection (d), a notice is
considered to be delivered on, as applicable:
(1)AAthe fifth day after the date the notice is mailed
via United States Postal Service; or
(2)AAthe date the notice is faxed or electronically
delivered.
(f)AAAn insurance carrier, or the carrier ’s authorized agent
or an informal or voluntary network at the carrier ’s request, shall
provide copies of each contract described by Subsection (c) to the
division on the request of the division.AAInformation included in a
contract under Subsection (c) is confidential and is not subject to
disclosure under Chapter 552, Government Code.AANotwithstanding
Subsection (c), the insurance carrier may be required to pay fees in
accordance with the division ’s fee guidelines if:
(1)AAthe contract:
(A)AAis not provided to the division on the
division ’s request;
(B)AAdoes not include a specific fee schedule
consistent with Subsection (c); or
(C)AAdoes not clearly state that the contractual
fee arrangement is between the health care provider and the named
insurance carrier or the carrier ’s authorized agent; or
(2)AAthe carrier or the carrier ’s authorized agent does
not comply with the notice requirements under Subsection (d).
(g)AAFailure to provide documentation described by
Subsection (e) to the division on the request of the division or
failure to provide notice as required under Subsection (d) creates
a rebuttable presumption in an enforcement action under this
subtitle and in a medical fee dispute under Chapter 413 that a
health care provider did not receive the notice.
39
(h)AAAn insurance carrier or the carrier ’s authorized agent
commits an administrative violation if the carrier or agent
violates any provision of this section.AAAny administrative
penalty assessed under this subsection shall be assessed against
the carrier, regardless of whether the carrier or agent committed
the violation.
(i)AANotwithstanding Section 1305.003(b), Insurance Code, in
the event of a conflict between this section and Section 413.016 or
any other provision of Chapter 413 of this code or Chapter 1305,
Insurance Code, this section prevails.
Added by Acts 2013, 83rd Leg., R.S., Ch. 1202 (S.B. 1322), Sec. 3,
eff. September 1, 2013.
Sec.A408.029.AANURSE FIRST ASSISTANT SERVICES. An insurance
carrier may not refuse to reimburse a health care practitioner
solely because that practitioner is a nurse first assistant, as
defined by Section 301.1525, Occupations Code, for a covered
service that a physician providing health care services under this
subtitle has requested the nurse first assistant to perform.
Added by Acts 2001, 77th Leg., ch. 812, Sec. 9, eff. Sept. 1, 2001.
Sec. 408.030.AAREPORTS OF PHYSICIAN VIOLATIONS. If the
division discovers an act or omission by a physician that may
constitute a felony, a misdemeanor involving moral turpitude, a
violation of a state or federal narcotics or controlled substance
law, an offense involving fraud or abuse under the Medicare or
Medicaid program, or a violation of this subtitle, the division
shall immediately report that act or omission to the Texas State
Board of Medical Examiners.
Added by Acts 2003, 78th Leg., ch. 202, Sec. 38, eff. June 10, 2003.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.091, eff.
September 1, 2005.
Sec. 408.031.AAWORKERS ’ COMPENSATION HEALTH CARE NETWORKS.
(a) Notwithstanding any other provision of this chapter, an
injured employee may receive benefits under a workers ’ compensation
40
health care network established under Chapter 1305, Insurance Code,
in the manner provided by that chapter.
(b)AAIn the event of a conflict between this title and
Chapter 1305, Insurance Code, as to the provision of medical
benefits for injured employees, the establishment and regulation of
fees for medical treatments and services, the time frames for
payment of medical bills, the operation and regulation of workers ’
compensation health care networks, the regulation of the health
care providers who contract with those networks, or the resolution
of disputes regarding medical benefits provided through those
networks, Chapter 1305, Insurance Code, prevails.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.092, eff.
September 1, 2005.
Sec. 408.032.AASTUDY ON INTERDISCIPLINARY PAIN
REHABILITATION PROGRAM AND FACILITY ACCREDITATION REQUIREMENT.
The division shall study the issue of required accreditation of
interdisciplinary pain rehabilitation programs or
interdisciplinary pain rehabilitation treatment facilities that
provide services to injured employees and shall report to the
legislature regarding any statutory changes that the division
considers necessary to require that accreditation.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.093, eff.
September 1, 2005.
SUBCHAPTER C. COMPUTATION OF AVERAGE WEEKLY WAGE
Sec.A408.041.AAAVERAGE WEEKLY WAGE. (a) Except as otherwise
provided by this subtitle, the average weekly wage of an employee
who has worked for the employer for at least the 13 consecutive
weeks immediately preceding an injury is computed by dividing the
sum of the wages paid in the 13 consecutive weeks immediately
preceding the date of the injury by 13.
(b)AAThe average weekly wage of an employee whose wage at the
time of injury has not been fixed or cannot be determined or who has
worked for the employer for less than the 13 weeks immediately
preceding the injury equals:
41
(1)AAthe usual wage that the employer pays a similar
employee for similar services; or
(2)AAif a similar employee does not exist, the usual
wage paid in that vicinity for the same or similar services provided
for remuneration.
(c)AAIf Subsection (a) or (b) cannot reasonably be applied
because the employee ’s employment has been irregular or because the
employee has lost time from work during the 13-week period
immediately preceding the injury because of illness, weather, or
another cause beyond the control of the employee, the commissioner
may determine the employee ’s average weekly wage by any method that
the commissioner considers fair, just, and reasonable to all
parties and consistent with the methods established under this
section.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.094, eff.
September 1, 2005.
Sec.A408.042.AAAVERAGE WEEKLY WAGE FOR PART-TIME EMPLOYEE OR
EMPLOYEE WITH MULTIPLE EMPLOYMENT. (a) The average weekly wage of
a part-time employee who limits the employee ’s work to less than a
full-time workweek as a regular course of that employee ’s conduct
is computed as provided by Section 408.041.
(b)AAFor part-time employees not covered by Subsection (a),
the average weekly wage:
(1)AAfor determining temporary income benefits is
computed as provided by Section 408.041; and
(2)AAfor determining impairment income benefits,
supplemental income benefits, lifetime income benefits, and death
benefits is computed as follows:
(A)AAif the employee has worked for the employer
for at least the 13 weeks immediately preceding the date of the
injury, the average weekly wage is computed by dividing the sum of
the wages paid in the 13 consecutive weeks immediately preceding
the date of the injury by 13 and adjusting that amount to the weekly
wage level the employee would have attained by working a full-time
42
workweek at the same rate of pay; or
(B)AAif the employee has worked for the employer
for less than 13 weeks immediately preceding the date of the injury,
the average weekly wage is equal to:
(i)AAthe weekly wage that the employer pays a
similar employee for similar services based on a full-time
workweek; or
(ii)AAif a similar employee does not exist,
the usual wage paid in that vicinity for the same or similar
services based on a full-time workweek.
(c)AAFor employees with multiple employment, the average
weekly wage for determining temporary income benefits, impairment
income benefits, supplemental income benefits, lifetime income
benefits, and death benefits, is computed as follows:
(1)AAthe average weekly wage for an employee with
multiple employment is equal to the sum of the average weekly wages
computed under Subdivisions (2) and (3);
(2)AAfor each of the employers for whom the employee has
worked for at least the 13 weeks immediately preceding the date of
injury, the average weekly wage is equal to the sum of the wages
paid by that employer to the employee in the 13 weeks immediately
preceding the injury divided by 13;
(3)AAfor each of the employers for whom the employee has
worked for less than the 13 weeks immediately preceding the date of
the injury, the average weekly wage is equal to:
(A)AAthe weekly wage that employer pays similar
employees for similar services; or
(B)AAif a similar employee does not exist, the
usual weekly wage paid in that vicinity for the same or similar
services; and
(4)AAthe average weekly wage of an employee with
multiple employment who limits the employee ’s work to less than a
full-time workweek, but does not do so as a regular course of that
employee ’s conduct, is adjusted to the weekly wage level the
employee would have attained by working a full-time workweek at the
employee ’s average rate of pay.
(d)AAThe commissioner shall:
43
(1)AAprescribe a form to collect information regarding
the wages of employees with multiple employment; and
(2)AAby rule, determine the manner by which the
division collects and distributes wage information to implement
this section.
(e)AAFor an employee with multiple employment, only the
employee ’s wages that are reportable for federal income tax
purposes may be considered. The employee shall document and verify
wage payments subject to this section.
(f)AAIf the commissioner determines that computing the
average weekly wage for an employee as provided by Subsection (c) is
impractical or unreasonable, the commissioner shall set the average
weekly wage in a manner that more fairly reflects the employee ’s
average weekly wage and that is fair and just to both parties or is
in the manner agreed to by the parties.AAThe commissioner by rule
may define methods to determine a fair and just average weekly wage
consistent with this section.
(g)AAAn insurance carrier is entitled to apply for and
receive reimbursement at least annually from the subsequent injury
fund for the amount of income and death benefits paid to a worker
under this section that are based on employment other than the
employment during which the compensable injury occurred.AAThe
commissioner may adopt rules that govern the documentation,
application process, and other administrative requirements
necessary to implement this subsection.
(h)AAIn this section:
(1)AA"Employee with multiple employment" means an
employee who has more than one employer.
(2)AA"Full-time workweek" means a 40-hour workweek.
(3)AA"Part-time employee" means an employee who, at the
time of the injury, was working less than a full-time workweek for
the employer for whom the employee was working when the compensable
injury occurred.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 2001, 77th Leg., ch. 1456, Sec. 10.03, eff. June 17, 2001.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.095, eff.
44
September 1, 2005.
Acts 2007, 80th Leg., R.S., Ch. 1150 (S.B. 1169), Sec. 2, eff.
September 1, 2007.
Sec.A408.043.AAAVERAGE WEEKLY WAGE FOR SEASONAL EMPLOYEE.
(a) For determining the amount of temporary income benefits of a
seasonal employee, the average weekly wage of the employee is
computed as provided by Section 408.041 and is adjusted as often as
necessary to reflect the wages the employee could reasonably have
expected to earn during the period that temporary income benefits
are paid.
(b)AAFor determining the amount of impairment income
benefits, supplemental income benefits, lifetime income benefits,
or death benefits of a seasonal employee, the average weekly wage of
the employee is computed by dividing the amount of total wages
earned by the employee during the 12 months immediately preceding
the date of the injury by 50.
(c)AAIf, for good reason, the commissioner determines that
computing the average weekly wage for a seasonal employee as
provided by this section is impractical, the commissioner shall
compute the average weekly wage as of the time of the injury in a
manner that is fair and just to both parties.
(d)AAIn this section, "seasonal employee" means an employee
who, as a regular course of the employee ’s conduct, engages in
seasonal or cyclical employment that does not continue throughout
the entire year.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.096, eff.
September 1, 2005.
Sec.A408.044.AAAVERAGE WEEKLY WAGE FOR MINOR, APPRENTICE,
TRAINEE, OR STUDENT. (a) For computing impairment income
benefits, supplemental income benefits, lifetime income benefits,
or death benefits, the average weekly wage of an employee shall be
adjusted to reflect the level of expected wages during the period
that the benefits are payable if:
45
(1)AAthe employee is a minor, apprentice, trainee, or
student at the time of the injury;
(2)AAthe employee ’s employment or earnings at the time
of the injury are limited primarily because of apprenticeship,
continuing formal training, or education intended to enhance the
employee ’s future wages; and
(3)AAthe employee ’s wages would reasonably be expected
to change because of a change of employment during that period.
(b)AAAn adjustment under Subsection (a) may not consider
expected wage levels for a period occurring after the third
anniversary of the date of the injury.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A408.0445.AAAVERAGE WEEKLY WAGE FOR MEMBERS OF STATE
MILITARY FORCES AND TEXAS TASK FORCE 1. (a)AAFor purposes of
computing income benefits or death benefits under Section 437.227,
Government Code, the average weekly wage of a member of the state
military forces as defined by Section 437.001, Government Code, who
is engaged in authorized training or duty is an amount equal to the
sum of the member ’s regular weekly wage at any employment the member
holds in addition to serving as a member of the state military
forces, disregarding any period during which the member is not
fully compensated for that employment because the member is engaged
in authorized military training or duty, and the member ’s regular
weekly wage as a member of the state military forces, except that
the amount may not exceed 100 percent of the state average weekly
wage as determined under Section 408.047.
(b)AAFor purposes of computing income benefits or death
benefits under Section 88.303, Education Code, the average weekly
wage of a Texas Task Force 1 member, as defined by Section 88.301,
Education Code, who is engaged in authorized training or duty is an
amount equal to the sum of the member ’s regular weekly wage at any
employment, including self-employment, that the member holds in
addition to serving as a member of Texas Task Force 1, except that
the amount may not exceed 100 percent of the state average weekly
wage as determined under Section 408.047.AAA member for whom an
average weekly wage cannot be computed shall be paid the minimum
46
weekly benefit established by the division.
Added by Acts 1999, 76th Leg., ch. 1205, Sec. 4, eff. Sept. 1, 1999.
Amended by Acts 2003, 78th Leg., ch. 644, Sec. 2, eff. June 20,
2003.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.097, eff.
September 1, 2005.
Acts 2013, 83rd Leg., R.S., Ch. 1217 (S.B. 1536), Sec. 3.14,
eff. September 1, 2013.
Sec.A408.0446.AAAVERAGE WEEKLY WAGE; SCHOOL DISTRICT
EMPLOYEE. (a) For determining the amount of temporary income
benefits of a school district employee under Chapter 504, the
average weekly wage is computed on the basis of wages earned in a
week rather than on the basis of wages paid in a week. The wages
earned in any given week are equal to the amount that would be
deducted from an employee ’s salary if the employee were absent from
work for one week and the employee did not have personal leave
available to compensate the employee for lost wages for that week.
(b)AAAn insurance carrier may adjust a school district
employee ’s average weekly wage as often as necessary to reflect the
wages the employee reasonably could expect to earn during the
period for which temporary income benefits are paid. In adjusting a
school district employee ’s average weekly wage under this
subsection, the insurance carrier may consider any evidence of the
employee ’s reasonable expectation of earnings.
(c)AAFor determining the amount of impairment income
benefits, supplemental income benefits, lifetime income benefits,
or death benefits of a school district employee under Chapter 504,
the average weekly wage of the employee is computed by dividing the
total amount of wages earned by the employee during the 12 months
immediately preceding the date of the injury by 50.
(d)AAIf the commissioner determines that computing the
average weekly wage of a school district employee as provided by
this section is impractical because the employee did not earn wages
during the 12 months immediately preceding the date of the injury,
the commissioner shall compute the average weekly wage in a manner
47
that is fair and just to both parties.
(e)AAThe commissioner shall adopt rules as necessary to
implement this section.
Added by Acts 2001, 77th Leg., ch. 1456, Sec. 10.04, eff. June 17,
2001.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.098, eff.
September 1, 2005.
Sec. 408.045.AANONPECUNIARY WAGES. The division may not
include nonpecuniary wages in computing an employee ’s average
weekly wage during a period in which the employer continues to
provide the nonpecuniary wages.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.099, eff.
September 1, 2005.
Sec.A408.046.AASIMILAR EMPLOYEES, SERVICES, OR EMPLOYMENT.
For purposes of this subchapter and Subchapter D, the determination
as to whether employees, services, or employment are the same or
similar must include consideration of:
(1)AAthe training and experience of the employees;
(2)AAthe nature of the work; and
(3)AAthe number of hours normally worked.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec. 408.047.AASTATE AVERAGE WEEKLY WAGE. (a) On and after
October 1, 2006, the state average weekly wage is equal to 88
percent of the average weekly wage in covered employment computed
by the Texas Workforce Commission under Section 207.002(c).
(b) Expired.
(c)AANotwithstanding Subsection (a), the commissioner by
rule may increase the state average weekly wage to an amount not to
exceed 100 percent of the average weekly wage in covered employment
computed by the Texas Workforce Commission under Section
207.002(c).
48
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 2003, 78th Leg., ch. 963, Sec. 6, eff. June 20, 2003.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.100, eff.
September 1, 2005.
SUBCHAPTER D. COMPUTATION OF BENEFITS
Sec.A408.061.AAMAXIMUM WEEKLY BENEFIT. (a) A weekly
temporary income benefit may not exceed 100 percent of the state
average weekly wage under Section 408.047 rounded to the nearest
whole dollar.
(b)AAA weekly impairment income benefit may not exceed 70
percent of the state average weekly wage rounded to the nearest
whole dollar.
(c)AAA weekly supplemental income benefit may not exceed 70
percent of the state average weekly wage rounded to the nearest
whole dollar.
(d)AAA weekly death benefit may not exceed 100 percent of the
state average weekly wage rounded to the nearest whole dollar.
(e)AAA weekly lifetime income benefit may not exceed 100
percent of the state average weekly wage rounded to the nearest
whole dollar.
(f)AAThe division shall compute the maximum weekly income
benefits for each state fiscal year not later than October 1 of each
year.
(g)AAThe maximum weekly income benefit in effect on the date
of injury is applicable for the entire time that the benefit is
payable.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.101, eff.
September 1, 2005.
Sec.A408.062.AAMINIMUM WEEKLY INCOME BENEFIT. (a) The
minimum weekly income benefit is 15 percent of the state average
weekly wage as determined under Section 408.047, rounded to the
49
nearest whole dollar.
(b)AAThe division shall compute the minimum weekly income
benefit for each state fiscal year not later than October 1 of each
year.
(c)AAThe minimum weekly income benefit in effect on the date
of injury is applicable for the entire time that income benefits are
payable.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.102, eff.
September 1, 2005.
Sec.A408.063.AAWAGE PRESUMPTIONS; ADMINISTRATIVE
VIOLATION. (a) To expedite the payment of income benefits, the
commissioner may by rule establish reasonable presumptions
relating to the wages earned by an employee, including the
presumption that an employee ’s last paycheck accurately reflects
the employee ’s usual wage.
(b)AANot later than the 30th day after the date the employer
receives notice of an injury to the employee, the employer shall
file a wage statement showing the amount of all wages paid to the
employee.
(c)AAAn employer who fails to file a wage statement in
accordance with Subsection (b) commits an administrative
violation.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.103, eff.
September 1, 2005.
Sec.A408.064.AAINTEREST ON ACCRUED BENEFITS. (a) An order
to pay income or death benefits accrued but unpaid must include
interest on the amount of compensation due at the rate provided by
Section 401.023.
(b)AAAccrued but unpaid compensation and interest shall be
paid in a lump sum.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
50
SUBCHAPTER E. INCOME BENEFITS IN GENERAL
Sec.A408.081.AAINCOME BENEFITS. (a)AAAn employee is
entitled to timely and accurate income benefits as provided in this
chapter.
(b)AAExcept as otherwise provided by this section or this
subtitle, income benefits shall be paid weekly as and when they
accrue without order from the commissioner.AAInterest on accrued
but unpaid benefits shall be paid, without order of the
commissioner, at the time the accrued benefits are paid.
(c)AAThe commissioner by rule shall establish requirements
for agreements under which income benefits may be paid
monthly.AAIncome benefits may be paid monthly only:
(1)AAon the request of the employee and the agreement of
the employee and the insurance carrier; and
(2)AAin compliance with the requirements adopted by the
commissioner.
(d)AAAn employee ’s entitlement to income benefits under this
chapter terminates on the death of the employee. An interest in
future income benefits does not survive after the employee ’s death.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1999, 76th Leg., ch. 1426, Sec. 11, eff. Sept. 1, 1999.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.104, eff.
September 1, 2005.
Acts 2011, 82nd Leg., R.S., Ch. 1153 (H.B. 2089), Sec. 1, eff.
September 1, 2011.
Sec. 408.0815.AARESOLUTION OF OVERPAYMENT OR UNDERPAYMENT OF
INCOME BENEFITS. (a)AAThe commissioner by rule shall establish a
procedure by which an insurance carrier:
(1)AAmay recoup an overpayment of income benefits from
future income benefit payments that are not reimbursable under
Section 410.209; and
(2)AAshall pay an underpayment of income benefits,
including interest on accrued but unpaid benefits, in accordance
51
with this subtitle.
(b)AAThe procedure under Subsection (a) must include:
(1)AAa process by which an injured employee may notify
the insurance carrier of an underpayment;
(2)AAthe time frame and methodology by which an
insurance carrier shall pay to an injured employee an underpayment;
(3)AAa process by which an insurance carrier shall
notify an injured employee of an overpayment of income benefits;
(4)AAthe time frame and methodology by which an
insurance carrier may recoup an overpayment through the reduction
of a future income benefit payment; and
(5)AAa method for coordinating overpayments that may be
recouped from future income benefits and reimbursements described
by Section 410.209.
(c)AAThe procedure for recouping overpayments under
Subsection (a)(1) must take into consideration the cause of the
overpayment and minimize the financial hardship to the injured
employee.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1153 (H.B. 2089), Sec. 2,
eff. September 1, 2011.
Sec.A408.082.AAACCRUAL OF RIGHT TO INCOME BENEFITS. (a)
Income benefits may not be paid under this subtitle for an injury
that does not result in disability for at least one week.
(b)AAIf the disability continues for longer than one week,
weekly income benefits begin to accrue on the eighth day after the
date of the injury. If the disability does not begin at once after
the injury occurs or within eight days of the occurrence but does
result subsequently, weekly income benefits accrue on the eighth
day after the date on which the disability began.
(c)AAIf the disability continues for two weeks or longer
after the date it begins, compensation shall be computed from the
date the disability begins.
(d)AAThis section does not preclude the recovery of medical
benefits as provided by Subchapter B.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
52
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.105, eff.
September 1, 2005.
Sec.A408.083.AATERMINATION OF RIGHT TO TEMPORARY INCOME,
IMPAIRMENT INCOME, AND SUPPLEMENTAL INCOME BENEFITS. (a) Except
as provided by Subsection (b), an employee ’s eligibility for
temporary income benefits, impairment income benefits, and
supplemental income benefits terminates on the expiration of 401
weeks after the date of injury.
(b)AAIf an employee incurs an occupational disease, the
employee ’s eligibility for temporary income benefits, impairment
income benefits, and supplemental income benefits terminates on the
expiration of 401 weeks after the date on which benefits began to
accrue.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1995, 74th Leg., ch. 980, Sec. 1.26, eff. Sept. 1, 1995.
Sec.A408.084.AACONTRIBUTING INJURY. (a) At the request of
the insurance carrier, the commissioner may order that impairment
income benefits and supplemental income benefits be reduced in a
proportion equal to the proportion of a documented impairment that
resulted from earlier compensable injuries.
(b)AAThe commissioner shall consider the cumulative impact
of the compensable injuries on the employee ’s overall impairment in
determining a reduction under this section.
(c)AAIf the combination of the compensable injuries results
in an injury compensable under Section 408.161, the benefits for
that injury shall be paid as provided by Section 408.162.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.106, eff.
September 1, 2005.
Sec. 408.085.AAADVANCE OF BENEFITS FOR HARDSHIP. (a) If
there is a likelihood that income benefits will be paid, the
commissioner may grant an employee suffering financial hardship
advances as provided by this subtitle against the amount of income
53
benefits to which the employee may be entitled.AAAn advance may be
ordered before or after the employee attains maximum medical
improvement.AAAn insurance carrier shall pay the advance ordered.
(b)AAAn employee must apply to the division for an advance on
a form prescribed by the commissioner.AAThe application must
describe the hardship that is the grounds for the advance.
(c)AAAn advance under this section may not exceed an amount
equal to four times the maximum weekly benefit for temporary income
benefits as computed in Section 408.061.AAThe commissioner may not
grant more than three advances to a particular employee based on the
same injury.
(d)AAThe commissioner may not grant an advance to an employee
who is receiving, on the date of the application under Subsection
(b), at least 90 percent of the employee ’s net preinjury wages under
Section 408.003 or 408.129.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.107, eff.
September 1, 2005.
Sec. 408.086.AADIVISION DETERMINATION OF EXTENDED
UNEMPLOYMENT OR UNDEREMPLOYMENT. (a) During the period that
impairment income benefits or supplemental income benefits are
being paid to an employee, the commissioner shall determine at
least annually whether any extended unemployment or
underemployment is a direct result of the employee ’s impairment.
(b)AATo make this determination, the commissioner may
require periodic reports from the employee and the insurance
carrier and, at the insurance carrier ’s expense, may require
physical or other examinations, vocational assessments, or other
tests or diagnoses necessary to perform the commissioner ’s duty
under this section and Subchapter H.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.108, eff.
September 1, 2005.
54
SUBCHAPTER F. TEMPORARY INCOME BENEFITS
Sec.A408.101.AATEMPORARY INCOME BENEFITS. (a) An employee
is entitled to temporary income benefits if the employee has a
disability and has not attained maximum medical improvement.
(b)AAOn the initiation of compensation as provided by Section
409.021, the insurance carrier shall pay temporary income benefits
as provided by this subchapter.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A408.102.AADURATION OF TEMPORARY INCOME BENEFITS. (a)
Temporary income benefits continue until the employee reaches
maximum medical improvement.
(b)AAThe commissioner by rule shall establish a presumption
that maximum medical improvement has been reached based on a lack of
medical improvement in the employee ’s condition.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.109, eff.
September 1, 2005.
Sec.A408.103.AAAMOUNT OF TEMPORARY INCOME BENEFITS. (a)
Subject to Sections 408.061 and 408.062, the amount of a temporary
income benefit is equal to:
(1)AA70 percent of the amount computed by subtracting
the employee ’s weekly earnings after the injury from the employee ’s
average weekly wage; or
(2)AAfor the first 26 weeks, 75 percent of the amount
computed by subtracting the employee ’s weekly earnings after the
injury from the employee ’s average weekly wage if the employee
earns less than $8.50 an hour.
(b)AAA temporary income benefit under Subsection (a)(2) may
not exceed the employee ’s actual earnings for the previous
year.AAIt is presumed that the employee ’s actual earnings for the
previous year are equal to:
(1)AAthe sum of the employee ’s wages as reported in the
most recent four quarterly wage reports to the Texas Workforce
55
Commission divided by 52;
(2)AAthe employee ’s wages in the single quarter of the
most recent four quarters in which the employee ’s earnings were
highest, divided by 13, if the commissioner finds that the
employee ’s most recent four quarters ’ earnings reported in the
Texas Workforce Commission wage reports are not representative of
the employee ’s usual earnings; or
(3)AAthe amount the commissioner determines from other
credible evidence to be the actual earnings for the previous year if
the Texas Workforce Commission does not have a wage report
reflecting at least one quarter ’s earnings because the employee
worked outside the state during the previous year.
(c)AAA presumption under Subsection (b) may be rebutted by
other credible evidence of the employee ’s actual earnings.
(d)AAThe Texas Employment Commission shall provide
information required under this section in the manner most
efficient for transferring the information.
(e)AAFor purposes of Subsection (a), if an employee is
offered a bona fide position of employment that the employee is
reasonably capable of performing, given the physical condition of
the employee and the geographic accessibility of the position to
the employee, the employee ’s weekly earnings after the injury are
equal to the weekly wage for the position offered to the employee.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.110, eff.
September 1, 2005.
Sec.A408.104.AAMAXIMUM MEDICAL IMPROVEMENT AFTER SPINAL
SURGERY. (a) On application by either the employee or the
insurance carrier, the commissioner by order may extend the
104-week period described by Section 401.011(30)(B) if the employee
has had spinal surgery, or has been approved for spinal surgery
under Section 408.026 and commissioner rules, within 12 weeks
before the expiration of the 104-week period.AAIf an order is
issued under this section, the order shall extend the statutory
period for maximum medical improvement to a date certain, based on
56
medical evidence presented to the commissioner.
(b)AAEither the employee or the insurance carrier may dispute
an application for extension made under this section. A dispute
under this subsection is subject to Chapter 410.
(c)AAThe commissioner shall adopt rules to implement this
section, including rules establishing procedures for requesting
and disputing an extension.
Added by Acts 1997, 75th Leg., ch. 1443, Sec. 5, eff. Jan. 1, 1998.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.111, eff.
September 1, 2005.
Sec.A408.105.AASALARY CONTINUATION IN LIEU OF TEMPORARY
INCOME BENEFITS. (a) In lieu of payment of temporary income
benefits under this subchapter, an employer may continue to pay the
salary of an employee who sustains a compensable injury under a
contractual obligation between the employer and employee, such as a
collective bargaining agreement, written agreement, or policy.
(b)AASalary continuation may include wage supplementation
if:
(1)AAemployer reimbursement is not sought from the
carrier as provided by Section 408.127; and
(2)AAthe supplementation does not affect the employee ’s
eligibility for any future income benefits.
Added by Acts 1999, 76th Leg., ch. 1003, Sec. 3, eff. Sept. 1, 1999.
SUBCHAPTER G. IMPAIRMENT INCOME BENEFITS
Sec.A408.121.AAIMPAIRMENT INCOME BENEFITS. (a) An
employee ’s entitlement to impairment income benefits begins on the
day after the date the employee reaches maximum medical improvement
and ends on the earlier of:
(1)AAthe date of expiration of a period computed at the
rate of three weeks for each percentage point of impairment; or
(2)AAthe date of the employee ’s death.
(b)AAThe insurance carrier shall begin to pay impairment
income benefits not later than the fifth day after the date on which
57
the insurance carrier receives the doctor ’s report certifying
maximum medical improvement. Impairment income benefits shall be
paid for a period based on the impairment rating, unless that rating
is disputed under Subsection (c).
(c)AAIf the insurance carrier disputes the impairment rating
used under Subsection (a), the carrier shall pay the employee
impairment income benefits for a period based on the carrier ’s
reasonable assessment of the correct rating.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec. 408.122.AAELIGIBILITY FOR IMPAIRMENT INCOME BENEFITS.
A claimant may not recover impairment income benefits unless
evidence of impairment based on an objective clinical or laboratory
finding exists.AAIf the finding of impairment is made by a doctor
chosen by the claimant and the finding is contested, a designated
doctor or a doctor selected by the insurance carrier must be able to
confirm the objective clinical or laboratory finding on which the
finding of impairment is based.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1995, 74th Leg., ch. 980, Sec. 1.27, eff. Sept. 1, 1995;
Acts 2001, 77th Leg., ch. 1456, Sec. 5.03, eff. June 17, 2001.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.112, eff.
September 1, 2005.
Sec. 408.1225.AADESIGNATED DOCTOR. (a)AATo be eligible to
serve as a designated doctor, a doctor must maintain an active
certification by the division.
(a-1)AAThe commissioner by rule shall develop a process for
the certification of a designated doctor.
(a-2)AAThe rules adopted by the commissioner under
Subsection (a-1) must:
(1)AArequire the division to evaluate the qualification
of designated doctors for certification using eligibility
requirements, including:
(A)AAeducational experience;
(B)AAprevious training; and
58
(C)AAdemonstrated ability to perform the specific
designated doctor duties described by Section 408.0041; and
(2)AArequire standard training and testing to be
completed in accordance with policies and guidelines developed by
the division.
(a-3)AAThe division shall develop guidelines for
certification training programs for certification of a designated
doctor under Subsection (a-1) to ensure a designated doctor ’s
competency and continued competency in providing assessments,
including:
(1)AAa standard curriculum;
(2)AAstandard course materials; and
(3)AAtesting criteria.
(a-4)AAThe division shall develop and implement a procedure
to periodically review and update the guidelines developed under
Subsection (a-3).
(a-5)AAThe division may authorize an independent training
and testing provider to conduct the certification program for the
division under the guidelines developed under Subsection (a-3).
(b)AAThe commissioner shall ensure the quality of designated
doctor decisions and reviews through active monitoring of the
decisions and reviews, and may take action as necessary to:
(1)AArestrict the participation of a designated doctor;
(2)AAdeny renewal of a designated doctor ’s
certification; or
(3)AArevoke a designated doctor ’s certification under
Section 413.044.
(c)AAThe report of the designated doctor has presumptive
weight, and the division shall base its determination of whether
the employee has reached maximum medical improvement on the report
unless the preponderance of the other medical evidence is to the
contrary.
(d)AAThe commissioner shall develop rules to ensure that a
designated doctor called on to conduct an examination under Section
408.0041 has no conflict of interest in serving as a designated
doctor in performing any examination.
(e)AAA designated doctor, other than a chiropractor, is
59
subject to Section 408.0043.AAA designated doctor who is a
chiropractor is subject to Section 408.0045.AATo the extent of a
conflict between this section and Section 408.0043 or 408.0045,
this section controls.
(f)AAA designated doctor shall continue providing services
related to a case assigned to the designated doctor, including
performing subsequent examinations or acting as a resource for
division disputes, unless the division authorizes the designated
doctor to discontinue providing services.AAThe commissioner by
rule shall prescribe the circumstances under which a designated
doctor is permitted to discontinue providing services, including:
(1)AAthe doctor decides to stop practicing in the
workers ’ compensation system; or
(2)AAthe doctor relocates the doctor ’s residence or
practice.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.112, eff.
September 1, 2005.
Amended by:
Acts 2007, 80th Leg., R.S., Ch. 1218 (H.B. 2004), Sec. 5, eff.
September 1, 2007.
Acts 2011, 82nd Leg., R.S., Ch. 1162 (H.B. 2605), Sec. 12,
eff. September 1, 2011.
Sec. 408.123.AACERTIFICATION OF MAXIMUM MEDICAL IMPROVEMENT;
EVALUATION OF IMPAIRMENT RATING. (a) After an employee has been
certified by a doctor as having reached maximum medical
improvement, the certifying doctor shall evaluate the condition of
the employee and assign an impairment rating using the impairment
rating guidelines described by Section 408.124.AAIf the
certification and evaluation are performed by a doctor other than
the employee ’s treating doctor, the certification and evaluation
shall be submitted to the treating doctor, and the treating doctor
shall indicate agreement or disagreement with the certification and
evaluation.
(b)AAA certifying doctor shall issue a written report
certifying that maximum medical improvement has been reached,
stating the employee ’s impairment rating, and providing any other
60
information required by the commissioner to:
(1)AAthe division;
(2)AAthe employee; and
(3)AAthe insurance carrier.
(c)AAThe commissioner shall adopt a rule that provides that,
at the conclusion of any examination in which maximum medical
improvement is certified and any impairment rating is assigned by
the treating doctor, written notice shall be given to the employee
that the employee may dispute the certification of maximum medical
improvement and assigned impairment rating.AAThe notice to the
employee must state how to dispute the certification of maximum
medical improvement and impairment rating.
(d)AAIf an employee is not certified as having reached
maximum medical improvement before the expiration of 102 weeks
after the date income benefits begin to accrue, the division shall
notify the treating doctor of the requirements of this subchapter.
(e)AAExcept as otherwise provided by this section, an
employee ’s first valid certification of maximum medical
improvement and first valid assignment of an impairment rating is
final if the certification or assignment is not disputed before the
91st day after the date written notification of the certification
or assignment is provided to the employee and the carrier by
verifiable means.
(f)AAAn employee ’s first certification of maximum medical
improvement or assignment of an impairment rating may be disputed
after the period described by Subsection (e) if:
(1)AAcompelling medical evidence exists of:
(A)AAa significant error by the certifying doctor
in applying the appropriate American Medical Association
guidelines or in calculating the impairment rating;
(B)AAa clearly mistaken diagnosis or a previously
undiagnosed medical condition; or
(C)AAimproper or inadequate treatment of the
injury before the date of the certification or assignment that
would render the certification or assignment invalid; or
(2)AAother compelling circumstances exist as
prescribed by commissioner rule.
61
(g)AAIf an employee has not been certified as having reached
maximum medical improvement before the expiration of 104 weeks
after the date income benefits begin to accrue or the expiration
date of any extension of benefits under Section 408.104, the
impairment rating assigned after the expiration of either of those
periods is final if the impairment rating is not disputed before the
91st day after the date written notification of the certification
or assignment is provided to the employee and the carrier by
verifiable means.AAA certification or assignment may be disputed
after the 90th day only as provided by Subsection (f).
(h)AAIf an employee ’s disputed certification of maximum
medical improvement or assignment of impairment rating is finally
modified, overturned, or withdrawn, the first certification or
assignment made after the date of the modification, overturning, or
withdrawal becomes final if the certification or assignment is not
disputed before the 91st day after the date notification of the
certification or assignment is provided to the employee and the
carrier by verifiable means.AAA certification or assignment may be
disputed after the 90th day only as provided by Subsection (f).
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 2003, 78th Leg., ch. 278, Sec. 1, eff. June 18, 2003; Acts
2003, 78th Leg., ch. 1190, Sec. 1, eff. June 20, 2003; Acts 2003,
78th Leg., ch. 1323, Sec. 2, eff. June 21, 2003.
Reenacted and amended by Acts 2005, 79th Leg., Ch. 265 (H.B. 7),
Sec. 3.113, eff. September 1, 2005.
Sec. 408.124.AAIMPAIRMENT RATING GUIDELINES. (a) An award
of an impairment income benefit, whether by the commissioner or a
court, must be based on an impairment rating determined using the
impairment rating guidelines described by this section.
(b)AAFor determining the existence and degree of an
employee ’s impairment, the division shall use "Guides to the
Evaluation of Permanent Impairment," third edition, second
printing, dated February 1989, published by the American Medical
Association.
(c)AANotwithstanding Subsection (b), the commissioner by
rule may adopt the fourth edition of the "Guides to the Evaluation
62
of Permanent Impairment," published by the American Medical
Association, or a subsequent edition of those guides, for
determining the existence and degree of an employee ’s impairment.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1999, 76th Leg., ch. 1426, Sec. 12, eff. Sept. 1, 1999.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.114, eff.
September 1, 2005.
Sec.A408.125.AADISPUTE AS TO IMPAIRMENT RATING. (a) If an
impairment rating is disputed, the commissioner shall direct the
employee to the next available doctor on the division ’s list of
designated doctors, as provided by Section 408.0041.
(b)AAThe designated doctor shall report in writing to the
division.
(c)AAThe report of the designated doctor shall have
presumptive weight, and the division shall base the impairment
rating on that report unless the preponderance of the other medical
evidence is to the contrary.AAIf the preponderance of the medical
evidence contradicts the impairment rating contained in the report
of the designated doctor chosen by the division, the division shall
adopt the impairment rating of one of the other doctors.
(d)AATo avoid undue influence on a person selected as a
designated doctor under this section, only the injured employee or
an appropriate member of the staff of the division may communicate
with the designated doctor about the case regarding the injured
employee ’s medical condition or history before the examination of
the injured employee by the designated doctor.AAAfter that
examination is completed, communication with the designated doctor
regarding the injured employee ’s medical condition or history may
be made only through appropriate division staff members.AAThe
designated doctor may initiate communication with any doctor who
has previously treated or examined the injured employee for the
work-related injury.
(e)AANotwithstanding Subsection (d), the treating doctor and
the insurance carrier are both responsible for sending to the
designated doctor all the injured employee ’s medical records that
63
are in their possession and that relate to the issue to be evaluated
by the designated doctor. The treating doctor and the insurance
carrier may send the records without a signed release from the
employee. The designated doctor is authorized to receive the
employee ’s confidential medical records to assist in the resolution
of disputes. The treating doctor and the insurance carrier may also
send the designated doctor an analysis of the injured employee ’s
medical condition, functional abilities, and return-to-work
opportunities.
(f)AAA violation of Subsection (d) is an administrative
violation.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1995, 74th Leg., ch. 980, Sec. 1.28, eff. Sept. 1, 1995;
Acts 2001, 77th Leg., ch. 1456, Sec. 5.04, eff. June 17, 2001.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.115, eff.
September 1, 2005.
Sec.A408.126.AAAMOUNT OF IMPAIRMENT INCOME BENEFITS.
Subject to Sections 408.061 and 408.062, an impairment income
benefit is equal to 70 percent of the employee ’s average weekly
wage.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A408.127.AAREDUCTION OF IMPAIRMENT INCOME BENEFITS. (a)
An insurance carrier shall reduce impairment income benefits to an
employee by an amount equal to employer payments made under Section
408.003 that are not reimbursed or reimbursable under that section.
(b)AAThe insurance carrier shall remit the amount of a
reduction under this section to the employer who made the payments.
(c)AAThe commissioner shall adopt rules and forms to ensure
the full reporting and the accuracy of reductions and
reimbursements made under this section.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.116, eff.
September 1, 2005.
64
Sec.A408.128.AACOMMUTATION OF IMPAIRMENT INCOME BENEFITS.
(a) An employee may elect to commute the remainder of the
impairment income benefits to which the employee is entitled if the
employee has returned to work for at least three months, earning at
least 80 percent of the employee ’s average weekly wage.
(b)AAAn employee who elects to commute impairment income
benefits is not entitled to additional income benefits for the
compensable injury.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A408.129.AAACCELERATION OF IMPAIRMENT INCOME BENEFITS.
(a) On approval by the commissioner of a written request received
from an employee, an insurance carrier shall accelerate the payment
of impairment income benefits to the employee.AAThe accelerated
payment may not exceed a rate of payment equal to that of the
employee ’s net preinjury wage.
(b)AAThe commissioner shall approve the request and order the
acceleration of the benefits if the commissioner determines that
the acceleration is:
(1)AArequired to relieve hardship; and
(2)AAin the overall best interest of the employee.
(c)AAThe duration of the impairment income benefits to which
the employee is entitled shall be reduced to offset the increased
payments caused by the acceleration taking into consideration the
discount for present payment computed at the rate provided under
Section 401.023.
(d)AAThe commissioner may prescribe forms necessary to
implement this section.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.117, eff.
September 1, 2005.
SUBCHAPTER H. SUPPLEMENTAL INCOME BENEFITS
Sec. 408.141.AAAWARD OF SUPPLEMENTAL INCOME BENEFITS. An
65
award of a supplemental income benefit, whether by the commissioner
or a court, shall be made in accordance with this subchapter.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.118, eff.
September 1, 2005.
Sec. 408.1415.AAWORK SEARCH COMPLIANCE STANDARDS. (a) The
commissioner by rule shall adopt compliance standards for
supplemental income benefit recipients that require each recipient
to demonstrate an active effort to obtain employment.AATo be
eligible to receive supplemental income benefits under this
chapter, a recipient must provide evidence satisfactory to the
division of:
(1)AAactive participation in a vocational
rehabilitation program conducted by the Department of Assistive and
Rehabilitative Services or a private vocational rehabilitation
provider;
(2)AAactive participation in work search efforts
conducted through the Texas Workforce Commission; or
(3)AAactive work search efforts documented by job
applications submitted by the recipient.
(b)AAIn adopting rules under this section, the commissioner
shall:
(1)AAestablish the level of activity that a recipient
should have with the Texas Workforce Commission and the Department
of Assistive and Rehabilitative Services;
(2)AAdefine the number of job applications required to
be submitted by a recipient to satisfy the work search
requirements; and
(3)AAconsider factors affecting the availability of
employment, including recognition of access to employment in rural
areas, economic conditions, and other appropriate employment
availability factors.
(c)AAThe commissioner may consult with the Texas Workforce
Commission, the Department of Assistive and Rehabilitative
Services, and other appropriate entities in adopting rules under
66
this section.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.119, eff.
September 1, 2005.
Sec.A408.142.AASUPPLEMENTAL INCOME BENEFITS. (a) An
employee is entitled to supplemental income benefits if on the
expiration of the impairment income benefit period computed under
Section 408.121(a)(1) the employee:
(1)AAhas an impairment rating of 15 percent or more as
determined by this subtitle from the compensable injury;
(2)AAhas not returned to work or has returned to work
earning less than 80 percent of the employee ’s average weekly wage
as a direct result of the employee ’s impairment;
(3)AAhas not elected to commute a portion of the
impairment income benefit under Section 408.128; and
(4)AAhas complied with the requirements adopted under
Section 408.1415.
(b)AAIf an employee is not entitled to supplemental income
benefits at the time of payment of the final impairment income
benefit because the employee is earning at least 80 percent of the
employee ’s average weekly wage, the employee may become entitled to
supplemental income benefits at any time within one year after the
date the impairment income benefit period ends if:
(1)AAthe employee earns wages for at least 90 days that
are less than 80 percent of the employee ’s average weekly wage;
(2)AAthe employee meets the requirements of Subsections
(a)(1), (3), and (4); and
(3)AAthe decrease in earnings is a direct result of the
employee ’s impairment from the compensable injury.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.1195, eff.
September 1, 2005.
Sec.A408.143.AAEMPLOYEE STATEMENT. (a) After the
commissioner ’s initial determination of supplemental income
benefits, the employee must file a statement with the insurance
67
carrier stating:
(1)AAthat the employee has earned less than 80 percent
of the employee ’s average weekly wage as a direct result of the
employee ’s impairment;
(2)AAthe amount of wages the employee earned in the
filing period provided by Subsection (b); and
(3)AAthat the employee has complied with the
requirements adopted under Section 408.1415.
(b)AAThe statement required under this section must be filed
quarterly on a form and in the manner provided by the
commissioner.AAThe commissioner may modify the filing period as
appropriate to an individual case.
(c)AAFailure to file a statement under this section relieves
the insurance carrier of liability for supplemental income benefits
for the period during which a statement is not filed.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.120, eff.
September 1, 2005.
Sec.A408.144.AACOMPUTATION OF SUPPLEMENTAL INCOME BENEFITS.
(a) Supplemental income benefits are calculated quarterly and paid
monthly.
(b)AASubject to Section 408.061, the amount of a supplemental
income benefit for a week is equal to 80 percent of the amount
computed by subtracting the weekly wage the employee earned during
the reporting period provided by Section 408.143(b) from 80 percent
of the employee ’s average weekly wage determined under Section
408.041, 408.042, 408.043, 408.044, 408.0445, or 408.0446.
(c)AAFor the purposes of this subchapter, if an employee is
offered a bona fide position of employment that the employee is
capable of performing, given the physical condition of the employee
and the geographic accessibility of the position to the employee,
the employee ’s weekly wages are considered to be equal to the weekly
wages for the position offered to the employee.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
68
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.1205, eff.
September 1, 2005.
Sec.A408.145.AAPAYMENT OF SUPPLEMENTAL INCOME BENEFITS. An
insurance carrier shall pay supplemental income benefits beginning
not later than the seventh day after the expiration date of the
employee ’s impairment income benefit period and shall continue to
pay the benefits in a timely manner.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A408.146.AATERMINATION OF SUPPLEMENTAL INCOME BENEFITS;
REINITIATION. (a) If an employee earns wages that are at least 80
percent of the employee ’s average weekly wage for at least 90 days
during a time that the employee receives supplemental income
benefits, the employee ceases to be entitled to supplemental income
benefits for the filing period.
(b)AASupplemental income benefits terminated under this
section shall be reinitiated when the employee:
(1)AAsatisfies the conditions of Section 408.142(b);
and
(2)AAfiles the statement required under Section
408.143.
(c)AANotwithstanding any other provision of this section, an
employee who is not entitled to supplemental income benefits for 12
consecutive months ceases to be entitled to any additional income
benefits for the compensable injury.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A408.147.AACONTEST OF SUPPLEMENTAL INCOME BENEFITS BY
INSURANCE CARRIER; ATTORNEY ’S FEES. (a) An insurance carrier may
request a benefit review conference to contest an employee ’s
entitlement to supplemental income benefits or the amount of
supplemental income benefits.
(b)AAIf an insurance carrier fails to make a request for a
benefit review conference within 10 days after the date of the
expiration of the impairment income benefit period or within 10
days after receipt of the employee ’s statement, the insurance
69
carrier waives the right to contest entitlement to supplemental
income benefits and the amount of supplemental income benefits for
that period of supplemental income benefits.
(c)AAIf an insurance carrier disputes the commissioner ’s
determination that an employee is entitled to supplemental income
benefits or the amount of supplemental income benefits due and the
employee prevails on any disputed issue, the insurance carrier is
liable for reasonable and necessary attorney ’s fees incurred by the
employee as a result of the insurance carrier ’s dispute and for
supplemental income benefits accrued but not paid and interest on
that amount, according to Section 408.064.AAAttorney ’s fees
awarded under this subsection are not subject to Sections
408.221(b), (f), and (i).
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1995, 74th Leg., ch. 76, Sec. 9.53, eff. Sept. 1, 1995; Acts
2001, 77th Leg., ch. 1456, Sec. 8.02, eff. June 17, 2001.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.121, eff.
September 1, 2005.
Sec. 408.148.AAEMPLOYEE DISCHARGE AFTER TERMINATION. The
commissioner may reinstate supplemental income benefits to an
employee who is discharged within 12 months of the date of losing
entitlement to supplemental income benefits under Section
408.146(c) if the commissioner finds that the employee was
discharged at that time with the intent to deprive the employee of
supplemental income benefits.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.122, eff.
September 1, 2005.
Sec. 408.149.AASTATUS REVIEW; BENEFIT REVIEW CONFERENCE.
(a) Not more than once in each period of 12 calendar months, an
employee and an insurance carrier each may request the commissioner
to review the status of the employee and determine whether the
employee ’s unemployment or underemployment is a direct result of
70
impairment from the compensable injury.
(b)AAEither party may request a benefit review conference to
contest a determination of the commissioner at any time, subject
only to the limits placed on the insurance carrier by Section
408.147.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.123, eff.
September 1, 2005.
Sec. 408.150.AAVOCATIONAL REHABILITATION. (a) The division
shall refer an employee to the Department of Assistive and
Rehabilitative Services with a recommendation for appropriate
services if the division determines that an employee could be
materially assisted by vocational rehabilitation or training in
returning to employment or returning to employment more nearly
approximating the employee ’s preinjury employment.AAThe division
shall also notify insurance carriers of the need for vocational
rehabilitation or training services.AAThe insurance carrier may
provide services through a private provider of vocational
rehabilitation services under Section 409.012.
(b)AAAn employee who refuses services or refuses to cooperate
with services provided under this section by the Department of
Assistive and Rehabilitative Services or a private provider loses
entitlement to supplemental income benefits.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1999, 76th Leg., ch. 956, Sec. 1, eff. Sept. 1, 1999; Acts
1999, 76th Leg., ch. 1426, Sec. 13, eff. Sept. 1, 1999.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.124, eff.
September 1, 2005.
Sec. 408.151.AAMEDICAL EXAMINATIONS FOR SUPPLEMENTAL INCOME
BENEFITS. (a) On or after the second anniversary of the date the
commissioner makes the initial award of supplemental income
benefits, an insurance carrier may not require an employee who is
receiving supplemental income benefits to submit to a medical
71
examination more than annually if, in the preceding year, the
employee ’s medical condition resulting from the compensable injury
has not improved sufficiently to allow the employee to return to
work.
(b)AAIf a dispute exists as to whether the employee ’s medical
condition has improved sufficiently to allow the employee to return
to work, the commissioner shall direct the employee to be examined
by a designated doctor chosen by the division.AAThe designated
doctor shall report to the division.AAThe report of the designated
doctor has presumptive weight, and the division shall base its
determination of whether the employee ’s medical condition has
improved sufficiently to allow the employee to return to work on
that report unless the preponderance of the other medical evidence
is to the contrary.
Added by Acts 1999, 76th Leg., ch. 850, Sec. 1, eff. Sept. 1, 1999.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.125, eff.
September 1, 2005.
SUBCHAPTER I. LIFETIME INCOME BENEFITS
Sec.A408.161.AALIFETIME INCOME BENEFITS. (a) Lifetime
income benefits are paid until the death of the employee for:
(1)AAtotal and permanent loss of sight in both eyes;
(2)AAloss of both feet at or above the ankle;
(3)AAloss of both hands at or above the wrist;
(4)AAloss of one foot at or above the ankle and the loss
of one hand at or above the wrist;
(5)AAan injury to the spine that results in permanent
and complete paralysis of both arms, both legs, or one arm and one
leg;
(6)AAa physically traumatic injury to the brain
resulting in incurable insanity or imbecility; or
(7)AAthird degree burns that cover at least 40 percent
of the body and require grafting, or third degree burns covering the
majority of either both hands or one hand and the face.
(b)AAFor purposes of Subsection (a), the total and permanent
72
loss of use of a body part is the loss of that body part.
(c)AASubject to Section 408.061, the amount of lifetime
income benefits is equal to 75 percent of the employee ’s average
weekly wage. Benefits being paid shall be increased at a rate of
three percent a year notwithstanding Section 408.061.
(d)AAAn insurance carrier may pay lifetime income benefits
through an annuity if the annuity agreement meets the terms and
conditions for annuity agreements adopted by the commissioner by
rule.AAThe establishment of an annuity under this subsection does
not relieve the insurance carrier of the liability under this title
for ensuring that the lifetime income benefits are paid.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1997, 75th Leg., ch. 1443, Sec. 7, eff. Sept. 1, 1997; Acts
1999, 76th Leg., ch. 1426, Sec. 14, eff. Sept. 1, 1999; Acts 2001,
77th Leg., ch. 1456, Sec. 9.01, eff. June 17, 2001.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.126, eff.
September 1, 2005.
Sec.A408.162.AASUBSEQUENT INJURY FUND BENEFITS. (a) If a
subsequent compensable injury, with the effects of a previous
injury, results in a condition for which the injured employee is
entitled to lifetime income benefits, the insurance carrier is
liable for the payment of benefits for the subsequent injury only to
the extent that the subsequent injury would have entitled the
employee to benefits had the previous injury not existed.
(b)AAThe subsequent injury fund shall compensate the
employee for the remainder of the lifetime income benefits to which
the employee is entitled.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
SUBCHAPTER J. DEATH AND BURIAL BENEFITS
Sec.A408.181.AADEATH BENEFITS. (a) An insurance carrier
shall pay death benefits to the legal beneficiary if a compensable
injury to the employee results in death.
(b)AASubject to Section 408.061, the amount of a death
73
benefit is equal to 75 percent of the employee ’s average weekly
wage.
(c)AAThe commissioner by rule shall establish requirements
for agreements under which death benefits may be paid
monthly.AADeath benefits may be paid monthly only:
(1)AAon the request of the legal beneficiary and the
agreement of the legal beneficiary and the insurance carrier; and
(2)AAin compliance with the requirements adopted by the
commissioner.
(d)AAAn insurance carrier may pay death benefits through an
annuity if the annuity agreement meets the terms and conditions for
annuity agreements adopted by the commissioner by rule.AAThe
establishment of an annuity under this subsection does not relieve
the insurance carrier of the liability under this title for
ensuring that the death benefits are paid.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1999, 76th Leg., ch. 1426, Sec. 15, eff. Sept. 1, 1999.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.127, eff.
September 1, 2005.
Sec.A408.182.AADISTRIBUTION OF DEATH BENEFITS. (a) If there
is an eligible child or grandchild and an eligible spouse, half of
the death benefits shall be paid to the eligible spouse and half
shall be paid in equal shares to the eligible children. If an
eligible child has predeceased the employee, death benefits that
would have been paid to that child shall be paid in equal shares per
stirpes to the children of the deceased child.
(b)AAIf there is an eligible spouse and no eligible child or
grandchild, all the death benefits shall be paid to the eligible
spouse.
(c)AAIf there is an eligible child or grandchild and no
eligible spouse, the death benefits shall be paid to the eligible
children or grandchildren.
(d)AAIf there is no eligible spouse, no eligible child, and
no eligible grandchild, the death benefits shall be paid in equal
shares to surviving dependents of the deceased employee who are
74
parents, stepparents, siblings, or grandparents of the deceased.
(d-1)AAIf there is no eligible spouse, no eligible child, and
no eligible grandchild, and there are no surviving dependents of
the deceased employee who are parents, siblings, or grandparents of
the deceased, the death benefits shall be paid in equal shares to
surviving eligible parents of the deceased.AAA payment of death
benefits made under this subsection may not exceed one payment per
household.AATotal payments under this section may not exceed 104
weeks regardless of the number of surviving eligible parents.
(d-2)AAExcept as otherwise provided by this subsection,AAto
be eligible to receive death benefits under Subsection (d-1), an
eligible parent must file with the division a claim for those
benefits not later than the first anniversary of the date of the
injured employee ’s death from the compensable injury.AAThe claim
must designate all eligible parents and necessary information for
payment to the eligible parents.AAThe insurance carrier is not
liable for payment to any eligible parent not designated on the
claim.AAFailure to file a claim in the time required bars the claim
unless good cause exists for the failure to file a claim under this
section.
(e)AAIf an employee is not survived by legal beneficiaries or
eligible parents, the death benefits shall be paid to the
subsequent injury fund under Section 403.007.
(f)AAIn this section:
(1)AA"Eligible child" means a child of a deceased
employee if the child is:
(A)AAa minor;
(B)AAenrolled as a full-time student in an
accredited educational institution and is less than 25 years of
age; or
(C)AAa dependent of the deceased employee at the
time of the employee ’s death.
(2)AA"Eligible grandchild" means a grandchild of a
deceased employee who is a dependent of the deceased employee and
whose parent is not an eligible child.
(3)AA"Eligible spouse" means the surviving spouse of a
deceased employee unless the spouse abandoned the employee for
75
longer than the year immediately preceding the death without good
cause, as determined by the division.
(4)AA"Eligible parent" means the mother or the father
of a deceased employee, including an adoptive parent or a
stepparent.AAThe term does not include a parent whose parental
rights have been terminated.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.128, eff.
September 1, 2005.
Acts 2007, 80th Leg., R.S., Ch. 1007 (H.B. 724), Sec. 5, eff.
September 1, 2007.
Acts 2007, 80th Leg., R.S., Ch. 1007 (H.B. 724), Sec. 6, eff.
September 1, 2007.
Acts 2009, 81st Leg., R.S., Ch. 344 (H.B. 1058), Sec. 1, eff.
September 1, 2009.
Sec.A408.183.AADURATION OF DEATH BENEFITS. (a) Entitlement
to death benefits begins on the day after the date of an employee ’s
death.
(b)AAAn eligible spouse is entitled to receive death benefits
for life or until remarriage.AAOn remarriage, the eligible spouse
is entitled to receive 104 weeks of death benefits, commuted as
provided by commissioner rule.
(c)AAA child who is eligible for death benefits because the
child is a minor on the date of the employee ’s death is entitled to
receive benefits until the child attains the age of 18.
(d)AAA child eligible for death benefits under Subsection (c)
who at age 18 is enrolled as a full-time student in an accredited
educational institution or a child who is eligible for death
benefits because on the date of the employee ’s death the child is
enrolled as a full-time student in an accredited educational
institution is entitled to receive or to continue to receive, as
appropriate, benefits until the earliest of:
(1)AAthe date the child ceases, for a second
consecutive semester, to be enrolled as a full-time student in an
accredited educational institution;
76
(2)AAthe date the child attains the age of 25; or
(3)AAthe date the child dies.
(e)AAA child who is eligible for death benefits because the
child is a dependent of the deceased employee on the date of the
employee ’s death is entitled to receive benefits until the earlier
of:
(1)AAthe date the child dies; or
(2)AAif the child is dependent:
(A)AAbecause the child is an individual with a
physical or mental disability, the date the child no longer has the
disability; or
(B)AAbecause of a reason other than a physical or
mental disability, the date of the expiration of 364 weeks of death
benefit payments.
(f)AAAn eligible grandchild is entitled to receive death
benefits until the earlier of:
(1)AAthe date the grandchild dies; or
(2)AAif the grandchild is:
(A)AAa minor at the time of the employee ’s death,
the date the grandchild ceases to be a minor; or
(B)AAnot a minor at the time of the employee ’s
death, the date of the expiration of 364 weeks of death benefit
payments.
(f-1)AAAn eligible parent who is not a surviving dependent of
the deceased employee is entitled to receive death benefits until
the earlier of:
(1)AAthe date the eligible parent dies; or
(2)AAthe date of the expiration of 104 weeks of death
benefit payments.
(g)AAAny other person entitled to death benefits is entitled
to receive death benefits until the earlier of:
(1)AAthe date the person dies; or
(2)AAthe date of the expiration of 364 weeks of death
benefit payments.
(h)AASection 401.011(16) does not apply to the use of the
term "disability" in this section.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
77
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.129, eff.
September 1, 2005.
Acts 2007, 80th Leg., R.S., Ch. 1007 (H.B. 724), Sec. 7, eff.
September 1, 2007.
Sec.A408.184.AAREDISTRIBUTION OF DEATH BENEFITS. (a) If a
legal beneficiary dies or otherwise becomes ineligible for death
benefits, benefits shall be redistributed to the remaining legal
beneficiaries as provided by Sections 408.182 and 408.183.
(b)AAIf a spouse ceases to be eligible because of remarriage,
the benefits payable to the remaining legal beneficiaries remain
constant for 104 weeks. After the 104th week, the spouse ’s share of
benefits shall be redistributed as provided by Sections 408.182 and
408.183.
(c)AAIf all legal beneficiaries, other than the subsequent
injury fund, cease to be eligible and the insurance carrier has not
made 364 weeks of full death benefit payments, including the
remarriage payment, the insurance carrier shall pay to the
subsequent injury fund an amount computed by subtracting the total
amount paid from the amount that would be paid for 364 weeks of
death benefits.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A408.185.AAEFFECT OF BENEFICIARY DISPUTE; ATTORNEY ’S
FEES. On settlement of a case in which the insurance carrier admits
liability for death benefits but a dispute exists as to the proper
beneficiary or beneficiaries, the settlement shall be paid in
periodic payments as provided by law, with a reasonable attorney ’s
fee not to exceed 25 percent of the settlement, paid periodically,
and based on time and expenses.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A408.186.AABURIAL BENEFITS. (a) If the death of an
employee results from a compensable injury, the insurance carrier
shall pay to the person who incurred liability for the costs of
burial the lesser of:
78
(1)AAthe actual costs incurred for reasonable burial
expenses; or
(2)AA$6,000.
(b)AAIf the employee died away from the employee ’s usual
place of employment, the insurance carrier shall pay the reasonable
cost of transporting the body, not to exceed the cost of
transporting the body to the employee ’s usual place of employment.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1999, 76th Leg., ch. 1426, Sec. 16, eff. Sept. 1, 1999.
Sec.A408.187.AAAUTOPSY. (a) If in a claim for death
benefits based on an occupational disease an autopsy is necessary
to determine the cause of death, the commission may, after
opportunity for hearing, order the legal beneficiaries of a
deceased employee to permit an autopsy.
(b)AAA legal beneficiary is entitled to have a representative
present at an autopsy ordered under this section.
(c)AAThe commissioner shall require the insurance carrier to
pay the costs of a procedure ordered under this section.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.130, eff.
September 1, 2005.
SUBCHAPTER K. PROTECTION OF RIGHTS TO BENEFITS
Sec.A408.201.AABENEFITS EXEMPT FROM LEGAL PROCESS. Benefits
are exempt from:
(1)AAgarnishment;
(2)AAattachment;
(3)AAjudgment; and
(4)AAother actions or claims.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec. 408.202.AAASSIGNABILITY OF BENEFITS. Benefits are not
assignable, except a legal beneficiary may, with the commissioner ’s
approval, assign the right to death benefits.
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Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.131, eff.
September 1, 2005.
Sec.A408.203.AAALLOWABLE LIENS. (a) An income or death
benefit is subject only to the following lien or claim, to the
extent the benefit is unpaid on the date the insurance carrier
receives written notice of the lien or claim, in the following order
of priority:
(1)AAan attorney ’s fee for representing an employee or
legal beneficiary in a matter arising under this subtitle;
(2)AAcourt-ordered child support; or
(3)AAa subrogation interest established under this
subtitle.
(b)AAA benefit that is subject to a lien or claim for payment
of court-ordered child support shall be paid as required by an order
or writ of income withholding under Chapter 158, Family Code.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1997, 75th Leg., ch. 165, Sec. 7.53, eff. Sept. 1, 1997;
Acts 2003, 78th Leg., ch. 610, Sec. 22, eff. Sept. 1, 2003.
SUBCHAPTER L. ATTORNEY ’S FEES IN WORKERS ’ COMPENSATION BENEFIT
MATTERS
Sec.A408.221.AAATTORNEY ’S FEES PAID TO CLAIMANT ’S COUNSEL.
(a) An attorney ’s fee, including a contingency fee, for
representing a claimant before the division or court under this
subtitle must be approved by the commissioner or court.
(b)AAExcept as otherwise provided, an attorney ’s fee under
this section is based on the attorney ’s time and expenses according
to written evidence presented to the division or court.AAExcept as
provided by Subsection (c) or Section 408.147(c), the attorney ’s
fee shall be paid from the claimant ’s recovery.
(c)AAAn insurance carrier that seeks judicial review under
Subchapter G, Chapter 410, of a final decision of the appeals panel
regarding compensability or eligibility for, or the amount of,
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income or death benefits is liable for reasonable and necessary
attorney ’s fees as provided by Subsection (d) incurred by the
claimant as a result of the insurance carrier ’s appeal if the
claimant prevails on an issue on which judicial review is sought by
the insurance carrier in accordance with the limitation of issues
contained in Section 410.302.AAIf the carrier appeals multiple
issues and the claimant prevails on some, but not all, of the issues
appealed, the court shall apportion and award fees to the
claimant ’s attorney only for the issues on which the claimant
prevails.AAIn making that apportionment, the court shall consider
the factors prescribed by Subsection (d).AAThis subsection does not
apply to attorney ’s fees for which an insurance carrier may be
liable under Section 408.147.AAAn award of attorney ’s fees under
this subsection is not subject to commissioner rules adopted under
Subsection (f).
(d)AAIn approving an attorney ’s fee under this section, the
commissioner or court shall consider:
(1)AAthe time and labor required;
(2)AAthe novelty and difficulty of the questions
involved;
(3)AAthe skill required to perform the legal services
properly;
(4)AAthe fee customarily charged in the locality for
similar legal services;
(5)AAthe amount involved in the controversy;
(6)AAthe benefits to the claimant that the attorney is
responsible for securing; and
(7)AAthe experience and ability of the attorney
performing the services.
(e)AAThe commissioner by rule or the court may provide for
the commutation of an attorney ’s fee, except that the attorney ’s fee
shall be paid in periodic payments in a claim involving death
benefits if the only dispute is as to the proper beneficiary or
beneficiaries.
(f)AAThe commissioner by rule shall provide guidelines for
maximum attorney ’s fees for specific services in accordance with
this section.
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(g)AAAn attorney ’s fee may not be allowed in a case involving
a fatal injury or lifetime income benefit if the insurance carrier
admits liability on all issues and tenders payment of maximum
benefits in writing under this subtitle while the claim is pending
before the division.
(h)AAAn attorney ’s fee shall be paid to the attorney by
separate draft.
(i)AAExcept as provided by Subsection (c) or Section 408.
147(c), an attorney ’s fee may not exceed 25 percent of the
claimant ’s recovery.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 2001, 77th Leg., ch. 1456, Sec. 8.01, eff. June 17, 2001.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.132, eff.
September 1, 2005.
Sec. 408.222.AAATTORNEY ’S FEES PAID TO DEFENSE COUNSEL. (a)
The amount of an attorney ’s fee for defending an insurance carrier
in a workers ’ compensation action brought under this subtitle must
be approved by the division or court and determined by the division
or court to be reasonable and necessary.
(b)AAIn determining whether a fee is reasonable under this
section, the division or court shall consider issues analogous to
those listed under Section 408.221(d).AAThe defense counsel shall
present written evidence to the division or court relating to:
(1)AAthe time spent and expenses incurred in defending
the case; and
(2)AAother evidence considered necessary by the
division or court in making a determination under this section.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 2001, 77th Leg., ch. 1456, Sec. 8.03, eff. June 17, 2001.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.133, eff.
September 1, 2005.
82
LABOR CODE
TITLE 5. WORKERS ’ COMPENSATION
SUBTITLE A. TEXAS WORKERS ’ COMPENSATION ACT
CHAPTER 409. COMPENSATION PROCEDURES
SUBCHAPTER A. INJURY REPORTS, CLAIMS, AND RECORDS
Sec.A409.001.AANOTICE OF INJURY TO EMPLOYER. (a) An
employee or a person acting on the employee ’s behalf shall notify
the employer of the employee of an injury not later than the 30th
day after the date on which:
(1)AAthe injury occurs; or
(2)AAif the injury is an occupational disease, the
employee knew or should have known that the injury may be related to
the employment.
(b)AAThe notice required under Subsection (a) may be given
to:
(1)AAthe employer; or
(2)AAan employee of the employer who holds a
supervisory or management position.
(c)AAIf the injury is an occupational disease, for purposes
of this section, the employer is the person who employed the
employee on the date of last injurious exposure to the hazards of
the disease.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec. 409.002.AAFAILURE TO FILE NOTICE OF INJURY. Failure to
notify an employer as required by Section 409.001(a) relieves the
employer and the employer ’s insurance carrier of liability under
this subtitle unless:
(1)AAthe employer, a person eligible to receive notice
under Section 409.001(b), or the employer ’s insurance carrier has
actual knowledge of the employee ’s injury;
(2)AAthe division determines that good cause exists for
failure to provide notice in a timely manner; or
(3)AAthe employer or the employer ’s insurance carrier
does not contest the claim.
1
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.134, eff.
September 1, 2005.
Sec. 409.003.AACLAIM FOR COMPENSATION. An employee or a
person acting on the employee ’s behalf shall file with the division
a claim for compensation for an injury not later than one year after
the date on which:
(1)AAthe injury occurred; or
(2)AAif the injury is an occupational disease, the
employee knew or should have known that the disease was related to
the employee ’s employment.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.135, eff.
September 1, 2005.
Sec. 409.004.AAEFFECT OF FAILURE TO FILE CLAIM FOR
COMPENSATION. Failure to file a claim for compensation with the
division as required under Section 409.003 relieves the employer
and the employer ’s insurance carrier of liability under this
subtitle unless:
(1)AAgood cause exists for failure to file a claim in a
timely manner; or
(2)AAthe employer or the employer ’s insurance carrier
does not contest the claim.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.136, eff.
September 1, 2005.
Sec.A409.005.AAREPORT OF INJURY; MODIFIED DUTY PROGRAM
NOTICE; ADMINISTRATIVE VIOLATION. (a) An employer shall report to
the employer ’s insurance carrier if:
(1)AAan injury results in the absence of an employee of
that employer from work for more than one day; or
2
(2)AAan employee of the employer notifies that employer
of an occupational disease under Section 409.001.
(b)AAThe report under Subsection (a) must be made not later
than the eighth day after:
(1)AAthe employee ’s absence from work for more than one
day due to an injury; or
(2)AAthe day on which the employer receives notice
under Section 409.001 that the employee has contracted an
occupational disease.
(c)AAThe employer shall deliver a written copy of the report
under Subsection (a) to the injured employee at the time that the
report is made to the insurance carrier.
(d)AAThe insurance carrier shall file the report of the
injury on behalf of the policyholder.AAExcept as provided by
Subsection (e), the insurance carrier must electronically file the
report with the division not later than the seventh day after the
date on which the carrier receives the report from the employer.
(e)AAThe commissioner may waive the electronic filing
requirement under Subsection (d) and allow an insurance carrier to
mail or deliver the report to the division not later than the
seventh day after the date on which the carrier receives the report
from the employer.
(f)AAA report required under this section may not be
considered to be an admission by or evidence against an employer or
an insurance carrier in a proceeding before the division or a court
in which the facts set out in the report are contradicted by the
employer or insurance carrier.
(g)AAIn addition to any information required under
Subsection (h), the report provided to the injured employee under
Subsection (c) must contain a summary written in plain language of
the employee ’s statutory rights and responsibilities under this
subtitle.
(h)AAThe commissioner may adopt rules relating to:
(1)AAthe information that must be contained in a report
required under this section, including the summary of rights and
responsibilities required under Subsection (g); and
(2)AAthe development and implementation of an
3
electronic filing system for injury reports under this section.
(i)AAAn employer and insurance carrier shall file subsequent
reports as required by commissioner rule.
(j)AAThe employer shall, on the written request of the
employee, a doctor, the insurance carrier, or the division, notify
the employee, the employee ’s treating doctor if known to the
employer, and the insurance carrier of the existence or absence of
opportunities for modified duty or a modified duty return-to-work
program available through the employer.AAIf those opportunities or
that program exists, the employer shall identify the employer ’s
contact person and provide other information to assist the doctor,
the employee, and the insurance carrier to assess modified duty or
return-to-work options.
(k)AAThis section does not prohibit the commissioner from
imposing requirements relating to return-to-work under other
authority granted to the division in this subtitle.
(l)AAA person commits an administrative violation if the
person fails to comply with this section unless good cause exists.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1995, 74th Leg., ch. 980, Sec. 1.29, eff. Sept. 1, 1995;
Acts 2001, 77th Leg., ch. 1456, Sec. 3.01, eff. June 17, 2001.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.137, eff.
September 1, 2005.
Sec.A409.006.AARECORD OF INJURIES; ADMINISTRATIVE
VIOLATION. (a) An employer shall maintain a record of each
employee injury as reported by an employee or otherwise made known
to the employer.
(b)AAThe record shall be available to the division at
reasonable times and under conditions prescribed by the
commissioner.
(c)AAThe commissioner may adopt rules relating to the
information that must be contained in an employer record under this
section.
(d)AAInformation contained in a record maintained under this
section is not an admission by the employer that:
4
(1)AAthe injury did in fact occur; or
(2)AAa fact maintained in the record is true.
(e)AAA person commits an administrative violation if the
person fails to comply with this section.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.138, eff.
September 1, 2005.
Sec.A409.007.AADEATH BENEFIT CLAIMS. (a) A person must file
a claim for death benefits with the division not later than the
first anniversary of the date of the employee ’s death.
(b)AAFailure to file in the time required by Subsection (a)
bars the claim unless:
(1)AAthe person is a minor or incompetent; or
(2)AAgood cause exists for the failure to file a claim
under this section.
(c)AAA separate claim must be filed for each legal
beneficiary unless the claim expressly includes or is made on
behalf of another person.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.139, eff.
September 1, 2005.
Sec.A409.008.AAFAILURE TO FILE EMPLOYER REPORT OF INJURY;
LIMITATIONS TOLLED. If an employer or the employer ’s insurance
carrier has been given notice or has knowledge of an injury to or
the death of an employee and the employer or insurance carrier
fails, neglects, or refuses to file the report under Section
409.005, the period for filing a claim for compensation under
Sections 409.003 and 409.007 does not begin to run against the claim
of an injured employee or a legal beneficiary until the day on which
the report required under Section 409.005 has been furnished.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec. 409.009.AASUBCLAIMS. A person may file a written claim
5
with the division as a subclaimant if the person has:
(1)AAprovided compensation, including health care
provided by a health care insurer, directly or indirectly, to or for
an employee or legal beneficiary; and
(2)AAsought and been refused reimbursement from the
insurance carrier.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.140, eff.
September 1, 2005.
Sec. 409.0091.AAREIMBURSEMENT PROCEDURES FOR CERTAIN
ENTITIES. (a) In this section, "health care insurer" means an
insurance carrier and an authorized representative of an insurance
carrier, as described by Section 402.084(c-1).
(b)AAThis section applies only to a request for reimbursement
by a health care insurer.
(c)AAHealth care paid by a health care insurer may be
reimbursable as a medical benefit.
(d)AAExcept as provided by Subsection (e), this section does
not prohibit or limit a substantive defense by a workers ’
compensation insurance carrier that the health care paid for by the
health care insurer was not a medical benefit or not a correct
payment.AAA subclaimant may not be reimbursed for payment for any
health care that was previously denied by a workers ’ compensation
insurance carrier under:
(1)AAa preauthorization review of the specific service
or medical procedure; or
(2)AAa medical necessity review that determined the
service was not medically necessary for the treatment of a
compensable injury.
(e)AAIt is not a defense to a subclaim by a health care
insurer that:
(1)AAthe subclaimant has not sought reimbursement from
a health care provider or the subclaimant ’s insured;
(2)AAthe subclaimant or the health care provider did
not request preauthorization under Section 413.014 or rules adopted
6
under that section; or
(3)AAthe health care provider did not bill the workers ’
compensation insurance carrier, as provided by Section 408.027,
before the 95th day after the date the health care for which the
subclaimant paid was provided.
(f)AASubject to the time limits under Subsection (n), the
health care insurer shall provide, with any reimbursement request,
the tax identification number of the health care insurer and the
following to the workers ’ compensation insurance carrier, in a form
prescribed by the division:
(1)AAinformation identifying the workers ’ compensation
case, including:
(A)AAthe division claim number;
(B)AAthe name of the patient or claimant;
(C)AAthe social security number of the patient or
claimant; and
(D)AAthe date of the injury; and
(2)AAinformation describing the health care paid by the
health care insurer, including:
(A)AAthe name of the health care provider;
(B)AAthe tax identification number of the health
care provider;
(C)AAthe date of service;
(D)AAthe place of service;
(E)AAthe ICD-9 code;
(F)AAthe CPT, HCPCS, NDC, or revenue code;
(G)AAthe amount charged by the health care
provider; and
(H)AAthe amount paid by the health care insurer.
(g)AAThe workers ’ compensation insurance carrier shall
reduce the amount of the reimbursable subclaim by any payments the
workers ’ compensation insurance carrierAApreviously made to the
same health care provider for the provision of the same health care
on the same dates of service.AAIn making such a reduction in
reimbursement to the subclaimant, the workers ’ compensation
insurance carrier shall provide evidence of the previous payments
made to the provider.
7
(h)AAFor each medical benefit paid, the workers ’
compensation insurance carrier shall pay to the health care insurer
the lesser of the amount payable under the applicable fee guideline
as of the date of service or the actual amount paid by the health
care insurer.AAIn the absence of a fee guideline for a specific
service paid, the amount per service paid by the health care insurer
shall be considered in determining a fair and reasonable payment
under rules under this subtitle defining fair and reasonable
medical reimbursement.AAThe health care insurer may not recover
interest as a part of the subclaim.
(i)AAOn receipt of a request for reimbursement under this
section, the workers ’ compensation insurance carrier shall respond
to the request in writing not later than the 90th day after the date
on which the request is received.AAIf additional information is
requested under Subsection (j), the workers ’ compensation
insurance carrier shall respond not later than the 120th day unless
the time is extended under Subsection (j).
(j)AAIf the workers ’ compensation insurance carrier requires
additional information from the health care insurer, the workers ’
compensation insurance carrier shall send notice to the health care
insurer requesting the additional information. The health care
insurer shall have 30 days to provide the requested
information.AAThe workers ’ compensation insurance carrier and the
health care insurer may establish additional periods for compliance
with this subsection by written mutual agreement.
(k)AAUnless the parties have agreed to an extension of time
under Subsection (j), the health care insurer must file a written
subclaim under this section not later than the 120th day after:
(1)AAthe workers ’ compensation insurance carrier fails
to respond to a request for reimbursement; or
(2)AAreceipt of the workers ’ compensation insurance
carrier ’s notice of denial to pay or reduction in reimbursement.
(l)AAAny dispute that arises from a failure to respond to or a
reduction or denial of a request for reimbursement of services that
form the basis of the subclaim must go through the appropriate
dispute resolution process under this subtitle and division
rules.AAThe commissioner of insurance and the commissioner of
8
workers ’ compensation shall modify rules under this subtitle as
necessary to allow the health care insurer access as a subclaimant
to the appropriate dispute resolution process.AARules adopted or
amended by the commissioner of insurance and the commissioner of
workers ’ compensation must recognize the status of a subclaimant as
a party to the dispute.AARules modified or adopted under this
section should ensure that the workers ’ compensation insurance
carrier is not penalized, including not being held responsible for
costs of obtaining the additional information, if the workers ’
compensation insurance carrier denies payment in order to move to
dispute resolution to obtain additional information to process the
request.
(m)AAIn a dispute filed under Chapter 410 that arises from a
subclaim under this section, a hearing officer may issue an order
regarding compensability or eligibility for benefits and order the
workers ’ compensation insurance carrier to reimburse health care
services paid by the health care insurer as appropriate under this
subtitle.AAAny dispute over the amount of medical benefits owed
under this section, including medical necessity issues, shall be
determined by medical dispute resolution under Sections 413.031 and
413.032.
(n)AAExcept as provided by Subsection (s), a health care
insurer must file a request for reimbursement with the workers ’
compensation insurance carrier not later than six months after the
date on which the health care insurer received information under
Section 402.084(c-3) and not later than 18 months after the health
care insurer paid for the health care service.
(o)AAThe commissioner and the commissioner of insurance
shall amend or adopt rules to specify the process by which an
employee who has paid for health care services described by Section
408.027(d) may seek reimbursement.
(p)AAUntil September 1, 2011, a workers ’ compensation
insurance carrier is exempt from any department and division data
reporting requirements affected by a lack of information caused by
reimbursement requests or subclaims under this section.AAIf data
reporting is required after that date, the requirement is
prospective only and may not require any data to be reported between
9
September 1, 2007, and the date required reporting is
reinstated.AAThe department and the division may make legislative
recommendations to the 82nd Legislature for the collection of
reimbursement request and subclaim data.
(q)AAAn action or failure to act by a workers ’ compensation
insurance carrier under this section may not serve as the basis for
an examination or administrative action by the department or the
division, or for any cause of action by any person, except for
judicial review under this subtitle.
(r)AAThe commissioner of insurance and the commissioner of
workers ’ compensation may adopt additional rules to clarify the
processes required by, fulfill the purpose of, or assist the
parties in the proper adjudication of subclaims under this section.
(s)AAOn or after September 1, 2007, from information provided
to a health care insurer before January 1, 2007, under Section
402.084(c-3), the health care insurer may file not later than March
1, 2008:
(1)AAa subclaim with the division under Subsection (l)
if a request for reimbursement has been presented and denied by a
workers ’ compensation insurance carrier; or
(2)AAa request for reimbursement under Subsection (f)
if a request for reimbursement has not previously been presented
and denied by the workers ’ compensation insurance carrier.
Added by Acts 2007, 80th Leg., R.S., Ch. 1007 (H.B. 724), Sec. 8,
eff. September 1, 2007.
Sec. 409.010.AAINFORMATION PROVIDED TO EMPLOYEE OR LEGAL
BENEFICIARY. Immediately on receiving notice of an injury or death
from any person, the division shall mail to the employee or legal
beneficiary a clear and concise description of:
(1)AAthe services provided by:
(A)AAthe division; and
(B)AAthe office of injured employee counsel,
including the services of the ombudsman program;
(2)AAthe division ’s procedures; and
(3)AAthe person ’s rights and responsibilities under
this subtitle.
10
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.141, eff.
September 1, 2005.
Sec.A409.011.AAINFORMATION PROVIDED TO EMPLOYER; EMPLOYER ’S
RIGHTS. (a) Immediately on receiving notice of an injury or death
from any person, the division shall mail to the employer a
description of:
(1)AAthe services provided by the division and the
office of injured employee counsel;
(2)AAthe division ’s procedures; and
(3)AAthe employer ’s rights and responsibilities under
this subtitle.
(b)AAThe information must include a clear statement of the
following rights of the employer:
(1)AAthe right to be present at all administrative
proceedings relating to an employee ’s claim;
(2)AAthe right to present relevant evidence relating to
an employee ’s claim at any proceeding;
(3)AAthe right to report suspected fraud;
(4)AAthe right to contest the compensability of an
injury if the insurance carrier accepts liability for the payment
of benefits;
(5)AAthe right to receive notice, after making a
written request to the insurance carrier, of:
(A)AAa proposal to settle a claim; or
(B)AAan administrative or a judicial proceeding
relating to the resolution of a claim; and
(6)AAthe right to contest the failure of the insurance
carrier to provide accident prevention services under Subchapter E,
Chapter 411.
(c)AAThe division is not required to provide the information
to an employer more than once during a calendar year.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.142, eff.
11
September 1, 2005.
Sec. 409.012.AAVOCATIONAL REHABILITATION INFORMATION. (a)
The division shall analyze each report of injury received from an
employer under this chapter to determine whether the injured
employee would be assisted by vocational rehabilitation.
(b)AAIf the division determines that an injured employee
would be assisted by vocational rehabilitation, the division shall
notify:
(1)AAthe injured employee in writing of the services
and facilities available through the Department of Assistive and
Rehabilitative Services and private providers of vocational
rehabilitation; and
(2)AAthe Department of Assistive and Rehabilitative
Services and the affected insurance carrier that the injured
employee has been identified as one who could be assisted by
vocational rehabilitation.
(c)AAThe division shall cooperate with the office of injured
employee counsel, the Department of Assistive and Rehabilitative
Services, and private providers of vocational rehabilitation in the
provision of services and facilities to employees by the Department
of Assistive and Rehabilitative Services.
(d)AAA private provider of vocational rehabilitation
services may register with the division.
(e)AAThe commissioner by rule may require that a private
provider of vocational rehabilitation services maintain certain
credentials and qualifications in order to provide services in
connection with a workers ’ compensation insurance claim.
(f)AARepealed by Acts 2011, 82nd Leg., R.S., Ch. 1083, Sec.
25(127), eff. June 17, 2011.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1999, 76th Leg., ch. 956, Sec. 2, eff. Sept. 1, 1999.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.143, eff.
September 1, 2005.
Acts 2011, 82nd Leg., R.S., Ch. 1083 (S.B. 1179), Sec.
25(127), eff. June 17, 2011.
12
Sec. 409.013.AAPLAIN LANGUAGE INFORMATION; NOTIFICATION OF
INJURED EMPLOYEE. (a) The division shall develop information for
public dissemination about the benefit process and the compensation
procedures established under this chapter.AAThe information must
be written in plain language and must be available in English and
Spanish.
(b)AAOn receipt of a report under Section 409.005, the
division shall contact the affected employee by mail or by
telephone and shall provide the information required under
Subsection (a) to that employee, together with any other
information that may be prepared by the office of injured employee
counsel or the division for public dissemination that relates to
the employee ’s situation, such as information relating to back
injuries or occupational diseases.
Added by Acts 1995, 74th Leg., ch. 980, Sec. 1.30, eff. Sept. 1,
1995.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.144, eff.
September 1, 2005.
SUBCHAPTER B. PAYMENT OF BENEFITS
Sec.A409.021.AAINITIATION OF BENEFITS; INSURANCE CARRIER ’S
REFUSAL; ADMINISTRATIVE VIOLATION. (a) An insurance carrier
shall initiate compensation under this subtitle promptly.AANot
later than the 15th day after the date on which an insurance carrier
receives written notice of an injury, the insurance carrier shall:
(1)AAbegin the payment of benefits as required by this
subtitle; or
(2)AAnotify the division and the employee in writing of
its refusal to pay and advise the employee of:
(A)AAthe right to request a benefit review
conference; and
(B)AAthe means to obtain additional information
from the division.
(a-1)AAAn insurance carrier that fails to comply with
13
Subsection (a) does not waive the carrier ’s right to contest the
compensability of the injury as provided by Subsection (c) but
commits an administrative violation subject to Subsection (e).
(a-2)AAAn insurance carrier is not required to comply with
Subsection (a) if the insurance carrier has accepted the claim as a
compensable injury and income or death benefits have not yet
accrued but will be paid by the insurance carrier when the benefits
accrue and are due.
(b)AAAn insurance carrier shall notify the division in
writing of the initiation of income or death benefit payments in the
manner prescribed by commissioner rules.
(c)AAIf an insurance carrier does not contest the
compensability of an injury on or before the 60th day after the date
on which the insurance carrier is notified of the injury, the
insurance carrier waives its right to contest compensability. The
initiation of payments by an insurance carrier does not affect the
right of the insurance carrier to continue to investigate or deny
the compensability of an injury during the 60-day period.
(d)AAAn insurance carrier may reopen the issue of the
compensability of an injury if there is a finding of evidence that
could not reasonably have been discovered earlier.
(e)AAAn insurance carrier commits an administrative
violation if the insurance carrier does not initiate payments or
file a notice of refusal as required by this section.
A
Text of subsec. (f) as added by Acts 2003, 78th Leg., ch. 939, Sec. 1
A
(f)AAFor purposes of this section, "written notice" to a
certified self-insurer occurs only on written notice to the
qualified claims servicing contractor designated by the certified
self-insurer under Section 407.061(c).
A
Text of subsec. (f) as added by Acts 2003, 78th Leg., ch. 1100, Sec.
1
A
(f)AAFor purposes of this section:
(1)AAa certified self-insurer receives notice on the
14
date the qualified claims servicing contractor designated by the
certified self-insurer under Section 407.061(c) receives notice;
and
(2)AAa political subdivision that self-insures under
Section 504.011, either individually or through an interlocal
agreement with other political subdivisions, receives notice on the
date the intergovernmental risk pool or other entity responsible
for administering the claim for the political subdivision receives
notice.
(j)AAEach insurance carrier shall establish a single point of
contact in the carrier ’s office for an injured employee for whom the
carrier receives a notice of injury.
Added by Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by Acts 2003, 78th Leg., ch. 939, Sec. 1, eff. Sept. 1,
2003; Acts 2003, 78th Leg., ch. 1100, Sec. 1, eff. Sept. 1, 2003.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.145, eff.
September 1, 2005.
Acts 2011, 82nd Leg., R.S., Ch. 1162 (H.B. 2605), Sec. 13,
eff. September 1, 2011.
Sec.A409.022.AAREFUSAL TO PAY BENEFITS; NOTICE;
ADMINISTRATIVE VIOLATION. (a) An insurance carrier ’s notice of
refusal to pay benefits under Section 409.021 must specify the
grounds for the refusal.
(b)AAThe grounds for the refusal specified in the notice
constitute the only basis for the insurance carrier ’s defense on
the issue of compensability in a subsequent proceeding, unless the
defense is based on newly discovered evidence that could not
reasonably have been discovered at an earlier date.
(c)AAAn insurance carrier commits an administrative
violation if the insurance carrier does not have reasonable grounds
for a refusal to pay benefits, as determined by the commissioner.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.146, eff.
September 1, 2005.
15
Sec.A409.023.AAPAYMENT OF BENEFITS; ADMINISTRATIVE
VIOLATION. (a) An insurance carrier shall continue to pay benefits
promptly as and when the benefits accrue without a final decision,
order, or other action of the commissioner, except as otherwise
provided.
(b)AABenefits shall be paid solely to the order of the
employee or the employee ’s legal beneficiary.
(c)AAAn insurance carrier commits an administrative
violation if the insurance carrier fails to comply with this
section.
(d)AAAn insurance carrier that commits multiple violations
of this section commits an additional administrative violation and
is subject to:
(1)AAthe sanctions provided under Section 415.023; and
(2)AArevocation of the right to do business under the
workers ’ compensation laws of this state.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.147, eff.
September 1, 2005.
Sec.A409.0231.AAPAYMENT BY ELECTRONIC FUNDS TRANSFER. (a)
An insurance carrier shall offer employees entitled to the payment
of benefits for a period of sufficient duration the option of
receiving the payments by electronic funds transfer. The insurance
carrier shall provide the necessary forms to an employee who
requests that benefits be paid by electronic funds transfer.
(b)AAThe commissioner shall adopt rules in consultation with
the Texas Department of Information Resources as necessary to
implement this section, including rules prescribing a period of
benefits that is of sufficient duration to allow payment by
electronic funds transfer.
Added by Acts 1999, 76th Leg., ch. 690, Sec. 1, eff. Sept. 1, 1999.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.148, eff.
September 1, 2005.
16
Sec.A409.0232.AATIMELINESS OF PAYMENTS. An insurance
carrier is considered to have paid benefits in a timely manner if a
payment:
(1)AAis made by electronic funds transfer and is
deposited in the employee ’s account on or before the benefit
payment due date;
(2)AAis made by mail and is mailed in time for the
payment to be postmarked on or before the benefit payment due date;
or
(3)AAis to be picked up by the employee and the payment
is made available to the employee during regular business hours not
later than the opening of business on the benefit payment due date.
Added by Acts 1999, 76th Leg., ch. 690, Sec. 1, eff. June 18, 1999.
Sec. 409.024.AATERMINATION OR REDUCTION OF BENEFITS; NOTICE;
ADMINISTRATIVE VIOLATION. (a) An insurance carrier shall file
with the division a notice of termination or reduction of benefits,
including the reasons for the termination or reduction, not later
than the 10th day after the date on which benefits are terminated or
reduced.
(b)AAAn insurance carrier commits an administrative
violation if the insurance carrier does not have reasonable grounds
to terminate or reduce benefits, as determined by the commissioner.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.149, eff.
September 1, 2005.
17
LABOR CODE
TITLE 5. WORKERS ’ COMPENSATION
SUBTITLE A. TEXAS WORKERS ’ COMPENSATION ACT
CHAPTER 410. ADJUDICATION OF DISPUTES
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 410.002.AALAW GOVERNING LIABILITY PROCEEDINGS. A
proceeding before the division to determine the liability of an
insurance carrier for compensation for an injury or death under
this subtitle is governed by this chapter.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.150, eff.
September 1, 2005.
Sec.A410.003.AAAPPLICATION OF ADMINISTRATIVE PROCEDURE AND
TEXAS REGISTER ACT. Except as otherwise provided by this chapter,
Chapter 2001, Government Code does not apply to a proceeding under
this chapter.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1995, 74th Leg., ch. 76, Sec. 5.95(49), eff. Sept. 1, 1995.
Sec.A410.005.AAVENUE FOR ADMINISTRATIVE PROCEEDINGS. (a)
Unless the division determines that good cause exists for the
selection of a different location, a benefit review conference or a
contested case hearing may not be conducted at a site more than 75
miles from the claimant ’s residence at the time of the injury.
(b)AAUnless the assigned arbitrator determines that good
cause exists for the selection of a different location, arbitration
may not be conducted at a site more than 75 miles from the
claimant ’s residence at the time of the injury.
(c)AAAll appeals panel proceedings shall be conducted in
Travis County.
(d)AANotwithstanding Subsection (a), the division may
conduct a benefit review conference telephonically on agreement by
the injured employee.
1
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.151, eff.
September 1, 2005.
Sec.A410.006.AAREPRESENTATION AT ADMINISTRATIVE
PROCEEDINGS. (a) A claimant may be represented at a benefit review
conference, a contested case hearing, or arbitration by an attorney
or may be assisted by an individual of the claimant ’s choice who
does not work for an attorney or receive a fee. An employee of an
attorney may represent a claimant if that employee:
(1)AAis a relative of the claimant; and
(2)AAdoes not receive a fee.
(b)AAAn insurance carrier may be represented by an attorney
or adjuster.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec. 410.007.AAINFORMATION LIST. (a) The division shall
determine the type of information that is most useful to parties to
help resolve disputes regarding income benefits. That information
may include:
(1)AAreports regarding the compensable injury;
(2)AAmedical information regarding the injured
employee; and
(3)AAwage records.
(b)AAThe division shall publish a list developed from the
information described under Subsection (a) in appropriate media,
including the division ’s Internet website, to provide guidance to a
party to a dispute regarding the type of information the party
should have available at a benefit review conference or a contested
case hearing.
(c)AAAt the time a benefit review conference or contested
case hearing is scheduled, the division shall make available a copy
of the list developed under Subsection (b) to each party to the
dispute.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.152, eff.
September 1, 2005.
2
SUBCHAPTER B. BENEFIT REVIEW CONFERENCE
Sec. 410.021.AAPURPOSE. A benefit review conference is a
nonadversarial, informal dispute resolution proceeding designed
to:
(1)AAexplain, orally and in writing, the rights of the
respective parties to a workers ’ compensation claim and the
procedures necessary to protect those rights;
(2)AAdiscuss the facts of the claim, review available
information in order to evaluate the claim, and delineate the
disputed issues; and
(3)AAmediate and resolve disputed issues by agreement
of the parties in accordance with this subtitle and the policies of
the division.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.153, eff.
September 1, 2005.
Sec.A410.022.AABENEFIT REVIEW OFFICERS; QUALIFICATIONS.
(a) A benefit review officer shall conduct a benefit review
conference.
(b)AAA benefit review officer must:
(1)AAbe an employee of the division;
(2)AAbe trained in the principles and procedures of
dispute mediation; and
(3)AAhave documentation satisfactory to the
commissioner that evidences the completion by the officer of at
least 40 classroom hours of training in dispute resolution
techniques from an alternative dispute resolution organization
recognized by the commissioner.
(c)AAThe division shall institute and maintain an education
and training program for benefit review officers and shall consult
or contract with the Federal Mediation and Conciliation Service or
other appropriate organizations for this purpose.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
3
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.154, eff.
September 1, 2005.
Sec. 410.023.AAREQUEST FOR BENEFIT REVIEW CONFERENCE. (a)
On receipt of a request from a party or on its own motion, the
division may direct the parties to a disputed workers ’ compensation
claim to meet in a benefit review conference to attempt to reach
agreement on disputed issues involved in the claim.
(b)AAThe division shall require the party requesting the
benefit review conference to provide documentation of efforts made
to resolve the disputed issues before the request was submitted.
(c)AAThe commissioner by rule shall:
(1)AAadopt guidelines regarding the type of information
necessary to satisfy the requirements of Subsection (b); and
(2)AAestablish a process through which the division
evaluates the sufficiency of the documentation provided under
Subsection (b).
(d)AAThe division may deny a request for a benefit review
conference if the party requesting the benefit review conference
does not provide the documentation required under Subsection (b).
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.155, eff.
September 1, 2005.
Acts 2011, 82nd Leg., R.S., Ch. 1162 (H.B. 2605), Sec. 14,
eff. September 1, 2011.
Sec. 410.024.AABENEFIT REVIEW CONFERENCE AS PREREQUISITE TO
FURTHER PROCEEDINGS ON CERTAIN CLAIMS. (a) Except as otherwise
provided by law or commissioner rule, the parties to a disputed
compensation claim are not entitled to a contested case hearing or
arbitration on the claim unless a benefit review conference is
conducted as provided by this subchapter.
(b)AAThe commissioner by rule shall adopt guidelines
relating to claims that do not require a benefit review conference
and may proceed directly to a contested case hearing or
4
arbitration.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.156, eff.
September 1, 2005.
Sec. 410.025.AASCHEDULING OF BENEFIT REVIEW CONFERENCE;
NOTICE. (a) The commissioner by rule shall prescribe the time
within which a benefit review conference must be scheduled.
(b)AAThe division shall schedule a contested case hearing to
be held not later than the 60th day after the date of the benefit
review conference if the disputed issues are not resolved at the
benefit review conference.
(c)AAThe division shall send written notice of the benefit
review conference to the parties to the claim and the employer.
(d)AAThe commissioner by rule shall provide for expedited
proceedings in cases in which compensability or liability for
essential medical treatment is in dispute.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.157, eff.
September 1, 2005.
Sec.A410.026.AAPOWERS AND DUTIES OF BENEFIT REVIEW OFFICER.
(a) A benefit review officer shall:
(1)AAmediate disputes between the parties and assist in
the adjustment of the claim consistent with this subtitle and the
policies of the division;
(2)AAthoroughly inform all parties of their rights and
responsibilities under this subtitle, especially in a case in which
the employee is not represented by an attorney or other
representative;
(3)AAensure that all documents and information relating
to the employee ’s wages, medical condition, and any other
information pertinent to the resolution of disputed issues are
contained in the claim file at the conference, especially in a case
in which the employee is not represented by an attorney or other
5
representative; and
(4)AAprepare a written report that details each issue
that is not resolved at the benefit review conference, as required
under Section 410.031, including any issue raised for the first
time at the conclusion of an additional benefit review conference
conducted under Subsection (b).
(b)AAA benefit review officer may schedule an
additionalAAbenefit review conference if:
(1)AAthe benefit review officer determines that any
available information pertinent to the resolution of disputed
issues was not produced at the initial benefit review conference;
and
(2)AAa second benefit review conference has not already
been conducted.
(c)AAA benefit review officer may not take testimony but may
direct questions to an employee, an employer, or a representative
of an insurance carrier to supplement or clarify information in a
claim file.
(d)AAA benefit review officer may not make a formal record.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.158, eff.
September 1, 2005.
Sec.A410.027.AARULES. (a) The commissioner shall adopt
rules for conducting benefit review conferences.
(b)AAA benefit review conference is not subject to common law
or statutory rules of evidence or procedure.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.159, eff.
September 1, 2005.
Sec. 410.028.AAFAILURE TO ATTEND; ADMINISTRATIVE VIOLATION.
(a)AAA scheduled benefit review conference shall be conducted even
though a party fails to attend unless the benefit review officer
determines that good cause, as defined by commissioner rule, exists
6
to reschedule the conference.
(b)AAIf a party to a benefit review conference under Section
410.023 requests that the benefit review conference be rescheduled
under this section, the party must submit a request in the same
manner as an initial request under Section 410.023.AAThe division
shall evaluate a request for a rescheduled benefit review
conference received under this section in the same manner as an
initial request received under Section 410.023.
(c)AAIf a party fails to request that a benefit review
conference be rescheduled in the time required by commissioner rule
or fails to attend a benefit review conference without good cause as
defined by commissioner rule, the party forfeits the party ’s
entitlement to attend a benefit review conference on the issue in
dispute, unless a benefit review officer is authorized to schedule
an additional benefit review conference under Section 410.026(b).
(d)AAThe commissioner shall adopt rules necessary to
implement and enforce this section, including rules that:
(1)AAdefine good cause; and
(2)AAestablish deadlines for requesting that a benefit
review conference be rescheduled under Subsection (b).
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.160, eff.
September 1, 2005.
Acts 2011, 82nd Leg., R.S., Ch. 1162 (H.B. 2605), Sec. 15,
eff. September 1, 2011.
Sec.A410.029.AARESOLUTION AT BENEFIT REVIEW CONFERENCE;
WRITTEN AGREEMENT. (a) A dispute may be resolved either in whole
or in part at a benefit review conference.
(b)AAIf the conference results in the resolution of some
disputed issues by agreement or in a settlement, the benefit review
officer shall reduce the agreement or the settlement to writing.
The benefit review officer and each party or the designated
representative of the party shall sign the agreement or settlement.
(c)AAA settlement takes effect on the date it is approved by
the director in accordance with Section 408.005.
7
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec. 410.030.AABINDING EFFECT OF AGREEMENT. (a) An
agreement signed in accordance with Section 410.029 is binding on
the insurance carrier through the conclusion of all matters
relating to the claim, unless the division or a court, on a finding
of fraud, newly discovered evidence, or other good and sufficient
cause, relieves the insurance carrier of the effect of the
agreement.
(b)AAThe agreement is binding on the claimant, if represented
by an attorney, to the same extent as on the insurance carrier.AAIf
the claimant is not represented by an attorney, the agreement is
binding on the claimant through the conclusion of all matters
relating to the claim while the claim is pending before the
division, unless the commissioner for good cause relieves the
claimant of the effect of the agreement.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.161, eff.
September 1, 2005.
Sec. 410.031.AAINCOMPLETE RESOLUTION; REPORT. (a) If a
dispute is not entirely resolved at a benefit review conference,
the benefit review officer shall prepare a written report that
details each issue that is not resolved at the conference.
(b)AAThe report must also include:
(1)AAa statement of each resolved issue;
(2)AAa statement of each issue raised but not resolved;
(3)AAa statement of the position of the parties
regarding each unresolved issue;
(4)AA a statement of the procedures required to request
a contested case hearing or arbitration and a complete explanation
of the differences in those proceedings and the rights of the
parties to subsequent review of the determinations made in those
proceedings; and
(5)AAthe date of the contested case hearing scheduled
in accordance with Section 410.025(b).
8
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.162, eff.
September 1, 2005.
Text of section as amended by Acts 2007, 80th Leg., R.S., Ch. 1177
(H.B. 473), Sec. 1
For text of section as amended by Acts 2007, 80th Leg., R.S., Ch.
1150 (S.B. 1169), Sec. 4, see other Sec. 410.032.
Sec. 410.032. PAYMENT OF BENEFITS UNDER INTERLOCUTORY ORDER.
(a) The benefit review officer who presides at the benefit review
conference shall consider a request for an interlocutory order and
shall give the opposing party the opportunity to respond before
issuing an interlocutory order.
(b)AAThe interlocutory order may address the payment or
suspension of accrued benefits, future benefits, or both accrued
benefits and future benefits.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1999, 76th Leg., ch. 955, Sec. 2, eff. Sept. 1, 1999.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.162, eff.
September 1, 2005.
Acts 2007, 80th Leg., R.S., Ch. 1177 (H.B. 473), Sec. 1, eff.
September 1, 2007.
Text of section as amended by Acts 2007, 80th Leg., R.S., Ch. 1150
(S.B. 1169), Sec. 4
For text of section as amended by Acts 2007, 80th Leg., R.S., Ch.
1177 (H.B. 473), Sec. 1, see other Sec. 410.032.
Sec. 410.032.AAPAYMENT OF BENEFITS UNDER INTERLOCUTORY
ORDER. (a) The benefit review officer who presides at the benefit
review conference shall:
(1)AAconsider a written or verbal request for an
interlocutory order for the payment of benefits; and
(2)AAif the benefit review officer determines that
issuance of an interlocutory order is appropriate, issue the
interlocutory order not later than the third day after the date of
9
receipt of the request under Subdivision (1).
(b)AAThe interlocutory order may address accrued benefits,
future benefits, or both accrued benefits and future benefits.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1999, 76th Leg., ch. 955, Sec. 2, eff. Sept. 1, 1999.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.162, eff.
September 1, 2005.
Acts 2007, 80th Leg., R.S., Ch. 1150 (S.B. 1169), Sec. 4, eff.
September 1, 2007.
Sec.A410.033.AAMULTIPLE CARRIERS. (a) If there is a dispute
as to which of two or more insurance carriers is liable for
compensation for one or more compensable injuries, the commissioner
may issue an interlocutory order directing each insurance carrier
to pay a proportionate share of benefits due pending a final
decision on liability.AAThe proportionate share is computed by
dividing the compensation due by the number of insurance carriers
involved.
(b)AAOn final determination of liability, an insurance
carrier determined to be not liable for the payment of benefits is
entitled to reimbursement for the share paid by the insurance
carrier from any insurance carrier determined to be liable.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.163, eff.
September 1, 2005.
Sec. 410.034.AAFILING OF AGREEMENT AND REPORT. (a) The
benefit review officer shall file the signed agreement and the
report with the division.
(b)AAThe commissioner by rule shall prescribe the times
within which the agreement and report must be filed.
(c)AAThe division shall furnish a copy of the file-stamped
report to:
(1)AAthe claimant;
(2)AAthe employer; and
10
(3)AAthe insurance carrier.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.164, eff.
September 1, 2005.
SUBCHAPTER C. ARBITRATION
Sec.A410.101.AAPURPOSE. The purpose of arbitration is to:
(1)AAenter into formal, binding stipulations on issues
on which the parties agree;
(2)AAresolve issues on which the parties disagree; and
(3)AArender a final award with respect to all issues in
dispute.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec. 410.102.AAARBITRATORS; QUALIFICATIONS. (a) An
arbitrator must be an employee of the division, except that the
division may contract with qualified arbitrators on a determination
of special need.
(b)AAAn arbitrator must:
(1)AAbe a member of the National Academy of
Arbitrators;
(2)AAbe on an approved list of the American Arbitration
Association or Federal Mediation and Conciliation Service; or
(3)AAmeet qualifications established by the
commissioner by rule.
(c)AAThe division shall require that each arbitrator have
appropriate training in the workers ’ compensation laws of this
state.AAThe commissioner shall establish procedures to carry out
this subsection.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.165, eff.
September 1, 2005.
Sec. 410.103.AADUTIES OF ARBITRATOR. An arbitrator shall:
11
(1)AAprotect the interests of all parties;
(2)AAensure that all relevant evidence has been
disclosed to the arbitrator and to all parties; and
(3)AArender an award consistent with this subtitle and
the policies of the division.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.166, eff.
September 1, 2005.
Sec.A410.104.AAELECTION OF ARBITRATION; EFFECT. (a) If
issues remain unresolved after a benefit review conference, the
parties, by agreement, may elect to engage in arbitration in the
manner provided by this subchapter. Arbitration may be used only to
resolve disputed benefit issues and is an alternative to a
contested case hearing. A contested case hearing scheduled under
Section 410.025(b) is canceled by an election under this
subchapter.
(b)AATo elect arbitration, the parties must file the election
with the division not later than the 20th day after the last day of
the benefit review conference.AAThe commissioner shall prescribe a
form for that purpose.
(c)AAAn election to engage in arbitration under this
subchapter is irrevocable and binding on all parties for the
resolution of all disputes arising out of the claims that are under
the jurisdiction of the division.
(d)AAAn agreement to elect arbitration binds the parties to
the provisions of Chapter 408 relating to benefits, and any award,
agreement, or settlement after arbitration is elected must comply
with that chapter.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.167, eff.
September 1, 2005.
Sec. 410.105.AALISTS OF ARBITRATORS. (a) The division shall
establish regional lists of arbitrators who meet the qualifications
12
prescribed under Sections 410.102(a) and (b).AAEach regional list
shall be initially prepared in a random name order, and subsequent
additions to a list shall be added chronologically.
(b)AAThe commissioner shall review the lists of arbitrators
annually and determine if each arbitrator is fair and impartial and
makes awards that are consistent with and in accordance with this
subtitle and the rules of the commissioner.AAThe commissioner shall
remove an arbitrator if, after the review, the commissioner
determines that the arbitrator is not fair and impartial or does not
make awards consistent with this subtitle and commissioner rules.
(c)AAThe division ’s lists are confidential and are not
subject to disclosure under Chapter 552, Government Code.AAThe
lists may not be revealed by any division employee to any person who
is not a division employee.AAThe lists are exempt from discovery in
civil litigation unless the party seeking the discovery establishes
reasonable cause to believe that a violation of the requirements of
this section or Section 410.106, 410.107, 410.108, or 410.109(b)
occurred and that the violation is relevant to the issues in
dispute.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1995, 74th Leg., ch. 76, Sec. 5.95(88), eff. Sept. 1, 1995.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.168, eff.
September 1, 2005.
Sec. 410.106.AASELECTION OF ARBITRATOR. The division shall
assign the arbitrator for a particular case by selecting the next
name after the previous case ’s selection in consecutive order.AAThe
division may not change the order of names once the order is
established under this subchapter, except that once each arbitrator
on the list has been assigned to a case, the names shall be randomly
reordered.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.169, eff.
September 1, 2005.
13
Sec.A410.107.AAASSIGNMENT OF ARBITRATOR. (a) The division
shall assign an arbitrator to a pending case not later than the 30th
day after the date on which the election for arbitration is filed
with the division.
(b)AAWhen an arbitrator has been assigned to a case under
Subsection (a), the parties shall be notified immediately.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.170, eff.
September 1, 2005.
Sec.A410.108.AAREJECTION OF ARBITRATOR. (a) Each party is
entitled, in its sole discretion, to one rejection of the
arbitrator in each case.AAIf a party rejects the arbitrator, the
division shall assign another arbitrator as provided by Section
410.106.
(b)AAA rejection must be made not later than the third day
after the date of notification of the arbitrator ’s assignment.
(c)AAWhen all parties have exercised their right of rejection
or if no rejection is registered, the assignment is final.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.171, eff.
September 1, 2005.
Sec. 410.109.AASCHEDULING OF ARBITRATION. (a) The
arbitrator shall schedule arbitration to be held not later than the
30th day after the date of the arbitrator ’s assignment and shall
notify the parties and the division of the scheduled date.
(b)AAIf an arbitrator is unable to schedule arbitration in
accordance with Subsection (a), the division shall appoint the next
arbitrator on the applicable list.AAEach party is entitled to
reject the arbitrator appointed under this subsection in the manner
provided under Section 410.108.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.172, eff.
14
September 1, 2005.
Sec.A410.110.AACONTINUANCE. (a) A request by a party for a
continuance of the arbitration to another date must be directed to
the director. The director may grant a continuance only if the
director determines, giving due regard to the availability of the
arbitrator, that good cause for the continuance exists.
(b)AAIf the director grants a continuance under this section,
the rescheduled date may not be later than the 30th day after the
original date of the arbitration.
(c)AAWithout regard to whether good cause exists, the
director may not grant more than one continuance to each party.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec. 410.111.AARULES. The commissioner shall adopt rules for
arbitration consistent with generally recognized arbitration
principles and procedures.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.173, eff.
September 1, 2005.
Sec.A410.112.AAEXCHANGE AND FILING OF INFORMATION;
ADMINISTRATIVE VIOLATION. (a) Not later than the seventh day
before the first day of arbitration, the parties shall exchange and
file with the arbitrator:
(1)AAall medical reports and other documentary evidence
not previously exchanged or filed that are pertinent to the
resolution of the claim; and
(2)AAinformation relating to their proposed resolution
of the disputed issues.
(b)AAA party commits an administrative violation if the
party, without good cause as determined by the arbitrator, fails to
comply with Subsection (a).
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.174, eff.
15
September 1, 2005.
Sec.A410.113.AADUTIES OF PARTIES AT ARBITRATION;
ATTENDANCE; ADMINISTRATIVE VIOLATION. (a) Each party shall
attend the arbitration prepared to set forth in detail its position
on unresolved issues and the issues on which it is prepared to
stipulate.
(b)AAA party commits an administrative violation if the party
does not attend the arbitration unless the arbitrator determines
that the party had good cause not to attend.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.175, eff.
September 1, 2005.
Sec.A410.114.AATESTIMONY; RECORD. (a) The arbitrator may
require witnesses to testify under oath and shall require testimony
under oath if requested by a party.
(b)AAThe division shall make an electronic recording of the
proceeding.
(c)AAAn official stenographic record is not required, but any
party may at the party ’s expense make a stenographic record of the
proceeding.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.176, eff.
September 1, 2005.
Sec.A410.115.AAEVIDENCE. (a) The parties may offer evidence
as they desire and shall produce additional evidence as the
arbitrator considers necessary to an understanding and
determination of the dispute.
(b)AAThe arbitrator is the judge of the relevance and
materiality of the evidence offered. Conformity to legal rules of
evidence is not required.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
16
Sec.A410.116.AACLOSING STATEMENTS; BRIEFS. The parties may
present closing statements as they desire, but the record may not
remain open for written briefs unless requested by the arbitrator.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A410.117.AAEX PARTE CONTACTS PROHIBITED. A party and an
arbitrator may not communicate outside the arbitration unless the
communication is in writing with copies provided to all parties or
relates to procedural matters.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A410.118.AAAWARD. (a) The arbitrator shall enter the
arbitrator ’s award not later than the seventh day after the last day
of arbitration.
(b)AAThe arbitrator shall base the award on the facts
established at arbitration, including stipulations of the parties,
and on the law as properly applied to those facts.
(c)AAThe award must:
(1)AAbe in writing;
(2)AAbe signed and dated by the arbitrator; and
(3)AAinclude a statement of the arbitrator ’s decision
on the contested issues and the parties ’ stipulations on
uncontested issues.
(d)AAThe arbitrator shall file a copy of the award as part of
the permanent claim file at the division and shall notify the
parties in writing of the decision.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.177, eff.
September 1, 2005.
Sec.A410.119.AAEFFECT OF AWARD. (a) An arbitrator ’s award
is final and binding on all parties. Except as provided by Section
410.121, there is no right to appeal.
(b)AAAn arbitrator ’s award is a final order of the division.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
17
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.178, eff.
September 1, 2005.
Sec.A410.120.AACLERICAL ERROR. For the purpose of
correcting a clerical error, an arbitrator retains jurisdiction of
the award for 20 days after the date of the award.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A410.121.AACOURT VACATING AWARD. (a) On application of
an aggrieved party, a court of competent jurisdiction shall vacate
an arbitrator ’s award on a finding that:
(1)AAthe award was procured by corruption, fraud, or
misrepresentation;
(2)AAthe decision of the arbitrator was arbitrary and
capricious; or
(3)AAthe award was outside the jurisdiction of the
division.
(b)AAIf an award is vacated, the case shall be remanded to the
division for another arbitration proceeding.
(c)AAA suit to vacate an award must be filed not later than
the 30th day after:
(1)AAthe date of the award; or
(2)AAthe date the appealing party knew or should have
known of a basis for suit under this section, but in no event later
than 12 months after an order denying compensation or after the
expiration of the income or death benefit period.
(d)AAVenue for a suit to vacate an award is in the county in
which the arbitration was conducted.
(e)AAIn a suit to vacate an arbitrator ’s award, only the
court may make determinations, including findings of fact or
conclusions of law.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.179, eff.
September 1, 2005.
SUBCHAPTER D. CONTESTED CASE HEARING
18
Sec.A410.151.AACONTESTED CASE HEARING; SCOPE. (a) If
arbitration is not elected under Section 410.104, a party to a claim
for which a benefit review conference is held or a party eligible to
proceed directly to a contested case hearing as provided by Section
410.024 is entitled to a contested case hearing.
(b)AAAn issue that was not raised at a benefit review
conference or that was resolved at a benefit review conference may
not be considered unless:
(1)AAthe parties consent; or
(2)AAif the issue was not raised, the commissioner
determines that good cause existed for not raising the issue at the
conference.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.180, eff.
September 1, 2005.
Sec.A410.152.AAHEARING OFFICERS; QUALIFICATIONS. (a) A
hearing officer shall conduct a contested case hearing.
(b)AAA hearing officer must be licensed to practice law in
this state.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec. 410.153.AAAPPLICATION OF ADMINISTRATIVE PROCEDURE ACT.
Chapter 2001, Government Code, applies to a contested case hearing
to the extent that the commissioner finds appropriate, except that
the following do not apply:
(1)AASection 2001.054;
(2)AASections 2001.061 and 2001.062;
(3)AASection 2001.202; and
(4)AASubchapters F, G, I, and Z, except for Section
2001.141(c).
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1995, 74th Leg., ch. 76, Sec. 5.93, eff. Sept. 1, 1995.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.181, eff.
19
September 1, 2005.
Sec. 410.154.AASCHEDULING OF HEARING. The division shall
schedule a contested case hearing in accordance with Section
410.024 or 410.025(b).
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.182, eff.
September 1, 2005.
Sec. 410.155.AACONTINUANCE. (a) A written request by a
party for a continuance of a contested case hearing to another date
must be directed to the division.
(b)AAThe division may grant a continuance only if the
division determines that there is good cause for the continuance.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.183, eff.
September 1, 2005.
Sec.A410.156.AAATTENDANCE REQUIRED; ADMINISTRATIVE
VIOLATION. (a) Each party shall attend a contested case hearing.
(b)AAA party commits an administrative violation if the
party, without good cause as determined by the hearing officer,
does not attend a contested case hearing.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.184, eff.
September 1, 2005.
Sec. 410.157.AARULES. The commissioner shall adopt rules
governing procedures under which contested case hearings are
conducted.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.185, eff.
September 1, 2005.
20
Sec.A410.158.AADISCOVERY. (a) Except as provided by Section
410.162, discovery is limited to:
(1)AAdepositions on written questions to any health
care provider;
(2)AAdepositions of other witnesses as permitted by the
hearing officer for good cause shown; and
(3)AAinterrogatories as prescribed by the
commissioner.
(b)AADiscovery under Subsection (a) may not seek information
that may readily be derived from documentary evidence described in
Section 410.160. Answers to discovery under Subsection (a) need
not duplicate information that may readily be derived from
documentary evidence described in Section 410.160.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.186, eff.
September 1, 2005.
Sec. 410.159.AASTANDARD INTERROGATORIES. (a) The
commissioner by rule shall prescribe standard form sets of
interrogatories to elicit information from claimants and insurance
carriers.
(b)AAStandard interrogatories shall be answered by each
party and served on the opposing party within the time prescribed by
commissioner rule, unless the parties agree otherwise.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.187, eff.
September 1, 2005.
Sec. 410.160.AAEXCHANGE OF INFORMATION. Within the time
prescribed by commissioner rule, the parties shall exchange:
(1)AAall medical reports and reports of expert
witnesses who will be called to testify at the hearing;
(2)AAall medical records;
(3)AAany witness statements;
21
(4)AAthe identity and location of any witness known to
the parties to have knowledge of relevant facts; and
(5)AAall photographs or other documents that a party
intends to offer into evidence at the hearing.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.188, eff.
September 1, 2005.
Sec. 410.161.AAFAILURE TO DISCLOSE INFORMATION. A party who
fails to disclose information known to the party or documents that
are in the party ’s possession, custody, or control at the time
disclosure is required by Sections 410.158-410.160 may not
introduce the evidence at any subsequent proceeding before the
division or in court on the claim unless good cause is shown for not
having disclosed the information or documents under those sections.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.189, eff.
September 1, 2005.
Sec.A410.162.AAADDITIONAL DISCOVERY. For good cause shown,
a party may obtain permission from the hearing officer to conduct
additional discovery as necessary.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A410.163.AAPOWERS AND DUTIES OF HEARING OFFICER. (a) At
a contested case hearing the hearing officer shall:
(1)AAswear witnesses;
(2)AAreceive testimony;
(3)AAallow examination and cross-examination of
witnesses;
(4)AAaccept documents and other tangible evidence; and
(5)AAallow the presentation of evidence by affidavit.
(b)AAA hearing officer shall ensure the preservation of the
rights of the parties and the full development of facts required for
the determinations to be made. A hearing officer may permit the use
22
of summary procedures, if appropriate, including witness
statements, summaries, and similar measures to expedite the
proceedings.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A410.164.AARECORD. (a) The proceedings of a contested
case hearing shall be recorded electronically. A party may request
a transcript of the proceeding and shall pay the reasonable cost of
the transcription.
(b)AAA party may request that the proceedings of the
contested case hearing be recorded by a court reporter. The party
making the request shall bear the cost.
(c)AAAt each contested case hearing, as applicable, the
insurance carrier shall file with the hearing officer and shall
deliver to the claimant a single document stating the true
corporate name of the insurance carrier and the name and address of
the insurance carrier ’s registered agent for service of process.
The document is part of the record of the contested case hearing.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 2001, 77th Leg., ch. 1456, Sec. 11.01, eff. June 17, 2001.
Sec.A410.165.AAEVIDENCE. (a) The hearing officer is the
sole judge of the relevance and materiality of the evidence offered
and of the weight and credibility to be given to the evidence.
Conformity to legal rules of evidence is not necessary.
(b)AAA hearing officer may accept a written statement signed
by a witness and shall accept all written reports signed by a health
care provider.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A410.166.AASTIPULATIONS. A written stipulation or
agreement of the parties that is filed in the record or an oral
stipulation or agreement of the parties that is preserved in the
record is final and binding.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A410.167.AAEX PARTE CONTACTS PROHIBITED. A party and a
23
hearing officer may not communicate outside the contested case
hearing unless the communication is in writing with copies provided
to all parties or relates to procedural matters.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A410.168.AADECISION. (a) The hearing officer shall
issue a written decision that includes:
(1)AAfindings of fact and conclusions of law;
(2)AAa determination of whether benefits are due; and
(3)AAan award of benefits due.
(b)AAThe decision may address accrued benefits, future
benefits, or both accrued benefits and future benefits.
(c)AAThe hearing officer may enter an interlocutory order for
the payment of all or part of medical benefits or income benefits.
The order may address accrued benefits, future benefits, or both
accrued benefits and future benefits. The order is binding during
the pendency of an appeal to the appeals panel.
(d)AAOn a form that the commissioner by rule prescribes, the
hearing officer shall issue a separate written decision regarding
attorney ’s fees and any matter related to attorney ’s fees.AAThe
decision regarding attorney ’s fees and the form may not be made
known to a jury in a judicial review of an award, including an
appeal.
(e)AAThe commissioner by rule shall prescribe the times
within which the hearing officer must file the decisions with the
division.
(f)AAThe division shall send a copy of the decision to each
party.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1999, 76th Leg., ch. 955, Sec. 3, eff. Sept. 1, 1999.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.190, eff.
September 1, 2005.
Sec.A410.169.AAEFFECT OF DECISION. A decision of a hearing
officer regarding benefits is final in the absence of a timely
appeal by a party and is binding during the pendency of an appeal to
24
the appeals panel.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
SUBCHAPTER E. APPEALS PANEL
Sec.A410.201.AAAPPEALS JUDGES; QUALIFICATIONS. (a)
Appeals judges, in a three-member panel, shall conduct
administrative appeals proceedings.
(b)AAAn appeals judge must be licensed to practice law in
this state.
(c)AAAn appeals judge may not conduct a benefit review
conference or a contested case hearing.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.191, eff.
September 1, 2005.
Sec.A410.202.AAREQUEST FOR APPEAL; RESPONSE. (a) To appeal
the decision of a hearing officer, a party shall file a written
request for appeal with the appeals panel not later than the 15th
day after the date on which the decision of the hearing officer is
received from the division and shall on the same date serve a copy
of the request for appeal on the other party.
(b)AAThe respondent shall file a written response with the
appeals panel not later than the 15th day after the date on which
the copy of the request for appeal is served and shall on the same
date serve a copy of the response on the appellant.
(c)AAA request for appeal or a response must clearly and
concisely rebut or support the decision of the hearing officer on
each issue on which review is sought.
(d)AASaturdays and Sundays and holidays listed in Section
662.003, Government Code, are not included in the computation of
the time in which a request for an appeal under Subsection (a) or a
response under Subsection (b) must be filed.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 2001, 77th Leg., ch. 1456, Sec. 12.01, eff. June 17, 2001.
25
Sec. 410.203.AAPOWERS AND DUTIES OF APPEALS PANEL; PRIORITY
OF HEARING ON REMAND. (a) The appeals panel shall consider:
(1)AAthe record developed at the contested case
hearing; and
(2)AAthe written request for appeal and response filed
with the appeals panel.
(b)AAThe appeals panel may:
(1)AAreverse the decision of the hearings officer and
render a new decision;
(2)AAreverse the decision of the hearings officer and
remand the case to the hearing officer for further consideration
and development of evidence; or
(3)AAaffirm the decision of the hearings officer in a
case described by Section 410.204(a-1).
(c)AAThe appeals panel may not remand a case under Subsection
(b)(2) more than once.
(d)AAA hearing on remand shall be accelerated and the
commissioner shall adopt rules to give priority to the hearing over
other proceedings.
(e)AAThe appeals panel shall issue and maintain a precedent
manual.AAThe precedent manual shall be composed of
precedent-establishing decisions and may include other information
as identified by the appeals panel.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.192, eff.
September 1, 2005.
Acts 2011, 82nd Leg., R.S., Ch. 1162 (H.B. 2605), Sec. 16,
eff. September 1, 2011.
Sec.A410.204.AADECISION. (a)AAThe appeals panel shall
review each request and issue a written decision on each reversed or
remanded case.AAThe appeals panel may issue a written decision on
an affirmed case as described by Subsection (a-1). The decision
must be in writing and shall be issued not later than the 45th day
after the date on which the written response to the request for
appeal is filed.AAThe appeals panel shall file a copy of the
26
decision with the commissioner.
(a-1)AAAn appeals panel may only issue a written decision in
a case in which the panel affirms the decision of a hearings officer
if the case:
(1)AAis a case of first impression;
(2)AAinvolves a recent change in law; or
(3)AAinvolves errors at the contested case hearing that
require correction but do not affect the outcome of the hearing,
including:
(A)AAfindings of fact for which insufficient
evidence exists;
(B)AAincorrect conclusions of law;
(C)AAfindings of fact or conclusions of law
regarding matters that were not properly before the hearings
officer; and
(D)AAlegal errors not otherwise described by this
subdivision.
(b)AAA copy of the decision of the appeals panel shall be sent
to each party not later than the seventh day after the date the
decision is filed with the division.
(c)AAIf the appeals panel does not issue a decision in
accordance with this section, the decision of the hearing officer
becomes final and is the final decision of the appeals panel.
(d)AAEach final decision of the appeals panel shall conclude
with a separate paragraph stating: "The true corporate name of the
insurance carrier is (NAME IN BOLD PRINT) and the name and address
of its registered agent for service of process is (NAME AND ADDRESS
IN BOLD PRINT)."
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 2001, 77th Leg., ch. 1456, Sec. 11.02, eff. June 17, 2001.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.193, eff.
September 1, 2005.
Acts 2011, 82nd Leg., R.S., Ch. 1162 (H.B. 2605), Sec. 17,
eff. September 1, 2011.
Sec.A410.205.AAEFFECT OF DECISION. (a) A decision of the
27
appeals panel regarding benefits is final in the absence of a timely
appeal for judicial review.
(b)AAThe decision of the appeals panel regarding benefits is
binding during the pendency of an appeal under Subchapter F or G.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1999, 76th Leg., ch. 955, Sec. 4, eff. Sept. 1, 1999.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.194, eff.
September 1, 2005.
Sec. 410.206.AACLERICAL ERROR. The division may revise a
decision in a contested case hearing on a finding of clerical error.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.195, eff.
September 1, 2005.
Sec. 410.207.AACONTINUATION OF DIVISION JURISDICTION.
During judicial review of the appeals panel decision on any
disputed issue relating to a workers ’ compensation claim, the
division retains jurisdiction of all other issues related to the
claim.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.196, eff.
September 1, 2005.
Sec. 410.208.AAJUDICIAL ENFORCEMENT OF ORDER OR DECISION;
ADMINISTRATIVE VIOLATION. (a) If a person refuses or fails to
comply with an interlocutory order, final order, or decision of the
commissioner, the division may bring suit in Travis County to
enforce the order or decision.
(b)AAIf an insurance carrier refuses or fails to comply with
an interlocutory order, a final order, or a decision of the
commissioner, the claimant may bring suit in the county of the
claimant ’s residence at the time of the injury, or death if the
employee is deceased, or, in the case of an occupational disease, in
28
the county in which the employee resided on the date disability
began or any county agreed to by the parties.
(c)AAIf the division brings suit to enforce an interlocutory
order, final order, or decision of the commissioner, the division
is entitled to reasonable attorney ’s fees and costs for the
prosecution and collection of the claim, in addition to a judgment
enforcing the order or decision and any other remedy provided by
law.
(d)AAA claimant who brings suit to enforce an interlocutory
order, final order, or decision of the commissioner is entitled to a
penalty equal to 12 percent of the amount of benefits recovered in
the judgment, interest, and reasonable attorney ’s fees for the
prosecution and collection of the claim, in addition to a judgment
enforcing the order or decision.
(e)AAA person commits an administrative violation if the
person fails or refuses to comply with an interlocutory order,
final order, or decision of the commissioner within 20 days after
the date the order or decision becomes final.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 2003, 78th Leg., ch. 397, Sec. 1, eff. Sept. 1, 2003.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.197, eff.
September 1, 2005.
Sec. 410.209.AAREIMBURSEMENT FOR OVERPAYMENT. The
subsequent injury fund shall reimburse an insurance carrier for any
overpayments of benefits made under an interlocutory order or
decision if that order or decision is reversed or modified by final
arbitration, order, or decision of the commissioner or a
court.AAThe commissioner shall adopt rules to provide for a
periodic reimbursement schedule, providing for reimbursement at
least annually.
Added by Acts 1999, 76th Leg., ch. 955, Sec. 5, eff. Sept. 1, 1999.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.198, eff.
September 1, 2005.
29
SUBCHAPTER F. JUDICIAL REVIEW--GENERAL PROVISIONS
Sec.A410.251.AAEXHAUSTION OF REMEDIES. A party that has
exhausted its administrative remedies under this subtitle and that
is aggrieved by a final decision of the appeals panel may seek
judicial review under this subchapter and Subchapter G, if
applicable.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A410.252.AATIME FOR FILING PETITION; VENUE. (a) A
party may seek judicial review by filing suit not later than the
45th day after the date on which the division mailed the party the
decision of the appeals panel.AAFor purposes of this section, the
mailing date is considered to be the fifth day after the date the
decision of the appeals panel was filed with the division.
(b)AAThe party bringing suit to appeal the decision must file
a petition with the appropriate court in:
(1)AAthe county where the employee resided at the time
of the injury or death, if the employee is deceased; or
(2)AAin the case of an occupational disease, in the
county where the employee resided on the date disability began or
any county agreed to by the parties.
(c)AAIf a suit under this section is filed in a county other
than the county described by Subsection (b), the court, on
determining that it does not have jurisdiction to render judgment
on the merits of the suit, shall transfer the case to a proper court
in a county described by Subsection (b). Notice of the transfer of
a suit shall be given to the parties. A suit transferred under this
subsection shall be considered for all purposes the same as if
originally filed in the court to which it is transferred.
(d)AAIf a suit is initially filed within the 45-day period in
Subsection (a), and is transferred under Subsection (c), the suit
is considered to be timely filed in the court to which it is
transferred.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 2003, 78th Leg., ch. 663, Sec. 1, eff. Sept. 1, 2003.
Amended by:
30
Acts 2009, 81st Leg., R.S., Ch. 1200 (H.B. 4545), Sec. 1, eff.
September 1, 2009.
Acts 2011, 82nd Leg., R.S., Ch. 1066 (S.B. 809), Sec. 1, eff.
September 1, 2011.
Sec. 410.253.AASERVICE; NOTICE. (a) A party seeking
judicial review shall simultaneously:
(1)AAfile a copy of the party ’s petition with the court;
(2)AAserve any opposing party to the suit; and
(3)AAprovide written notice of the suit or notice of
appeal to the division.
(b)AAA party may not seek judicial review under Section
410.251 unless the party has provided written notice of the suit to
the division as required by this section.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 2003, 78th Leg., ch. 397, Sec. 2, eff. Sept. 1, 2003.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.199, eff.
September 1, 2005.
Sec. 410.254.AAINTERVENTION. On timely motion initiated by
the commissioner, the division shall be permitted to intervene in
any judicial proceeding under this subchapter or Subchapter G.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.200, eff.
September 1, 2005.
Sec.A410.255.AAJUDICIAL REVIEW OF ISSUES OTHER THAN
COMPENSABILITY OR INCOME OR DEATH BENEFITS. (a) For all issues
other than those covered under Section 410.301(a), judicial review
shall be conducted in the manner provided for judicial review of a
contested case under Subchapter G, Chapter 2001, Government Code.
(b)AAJudicial review conducted under this section is
governed by the substantial evidence rule.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1995, 74th Leg., ch. 76, Sec. 5.95(53), eff. Sept. 1, 1995.
31
Sec.A410.256.AACOURT APPROVAL OF SETTLEMENT. (a) A claim or
issue may not be settled contrary to the provisions of the appeals
panel decision issued on the claim or issue unless a party to the
proceeding has filed for judicial review under this subchapter or
Subchapter G.AAThe trial court must approve a settlement made by
the parties after judicial review of an award is sought and before
the court enters judgment.
(b)AAThe court may not approve a settlement except on a
finding that:
(1)AAthe settlement accurately reflects the agreement
between the parties;
(2)AAthe settlement adheres to all appropriate
provisions of the law; and
(3)AAunder the law and facts, the settlement is in the
best interest of the claimant.
(c)AAA settlement may not provide for:
(1)AApayment of any benefits in a lump sum except as
provided by Section 408.128; or
(2)AAlimitation or termination of the claimant ’s right
to medical benefits under Section 408.021.
(d)AAA settlement or agreement that resolves an issue of
impairment may not be made before the claimant reaches maximum
medical improvement and must adopt one of the impairment ratings
under Subchapter G, Chapter 408.
(e)AAA party proposing a settlement before judgment is
entered by the trial court may petition the court orally or in
writing for approval of the settlement.
(f)AASettlement of a claim or issue under this section does
not constitute a modification or reversal of the decision awarding
benefits for the purpose of Section 410.209.
(g)AASettlement of a claim or issue must be in compliance
with all appropriate provisions of the law, including this section
and Section 410.258 of this subchapter. A settlement which on its
face does not comply with this section is void.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1997, 75th Leg., ch. 1267, Sec. 1, eff. Sept. 1, 1997; Acts
32
2003, 78th Leg., ch. 397, Sec. 3, eff. Sept. 1, 2003.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.2001, eff.
September 1, 2005.
Sec.A410.257.AAJUDGMENT AFTER JUDICIAL REVIEW. (a) A
judgment entered by a court on judicial review of the appeals panel
decision under this subchapter or Subchapter GAAmust comply with
all appropriate provisions of the law.
(b)AAA judgment under this section may not provide for:
(1)AApayment of benefits in a lump sum except as
provided by Section 408.128; or
(2)AAthe limitation or termination of the claimant ’s
right to medical benefits under Section 408.021.
(c)AAA judgment that resolves an issue of impairment may not
be entered before the date the claimant reaches maximum medical
improvement. The judgment must adopt an impairment rating under
Subchapter G, Chapter 408, except to the extent Section 410.307
applies.
(d)AAA judgment under this section may not order
reimbursement from the subsequent injury fund.
(e)AAA judgment under this section based on default or on an
agreement of the parties does not constitute a modification or
reversal of a decision awarding benefits for the purpose of Section
410. 209.
(f)AAA judgment that on its face does not comply with this
section is void.
Added by Acts 1997, 75th Leg., ch. 1267, Sec. 2, eff. Sept. 1, 1997.
Amended by Acts 2003, 78th Leg., ch. 397, Sec. 4, eff. Sept. 1,
2003.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.2002, eff.
September 1, 2005.
Sec. 410.258.AANOTIFICATION OF DIVISION OF PROPOSED
JUDGMENTS AND SETTLEMENTS; RIGHT TO INTERVENE. (a) The party who
initiated a proceeding under this subchapter or Subchapter G must
33
file any proposed judgment or settlement made by the parties to the
proceeding, including a proposed default judgment, with the
division not later than the 30th day before the date on which the
court is scheduled to enter the judgment or approve the
settlement.AAThe proposed judgment or settlement must be mailed to
the division by certified mail, return receipt requested.
(b)AAThe division may intervene in a proceeding under
Subsection (a) not later than the 30th day after the date of receipt
of the proposed judgment or settlement.
(c)AAThe commissioner shall review the proposed judgment or
settlement to determine compliance with all appropriate provisions
of the law.AAIf the commissioner determines that the proposal is
not in compliance with the law, the division may intervene as a
matter of right in the proceeding not later than the 30th day after
the date of receipt of the proposed judgment or settlement.AAThe
court may limit the extent of the division ’s intervention to
providing the information described by Subsection (e).
(d)AAIf the division does not intervene before the 31st day
after the date of receipt of the proposed judgment or settlement,
the court shall enter the judgment or approve the settlement if the
court determines that the proposed judgment or settlement is in
compliance with all appropriate provisions of the law.
(e)AAIf the division intervenes in the proceeding, the
commissioner shall inform the court of each reason the commissioner
believes the proposed judgment or settlement is not in compliance
with the law.AAThe court shall give full consideration to the
information provided by the commissioner before entering a judgment
or approving a settlement.
(f)AAA judgment entered or settlement approved without
complying with the requirements of this section is void.
Added by Acts 1997, 75th Leg., ch. 1267, Sec. 2, eff. Sept. 1, 1997.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.201, eff.
September 1, 2005.
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.202, eff.
September 1, 2005.
34
SUBCHAPTER G. JUDICIAL REVIEW OF ISSUES REGARDING COMPENSABILITY OR
INCOME OR DEATH BENEFITS
Sec.A410.301.AAJUDICIAL REVIEW OF ISSUES REGARDING
COMPENSABILITY OR INCOME OR DEATH BENEFITS. (a) Judicial review of
a final decision of the appeals panel regarding compensability or
eligibility for or the amount of income or death benefits shall be
conducted as provided by this subchapter.
(b)AAA determination of benefits before a court shall be in
accordance with this subtitle.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.203, eff.
September 1, 2005.
Sec. 410.302.AAADMISSIBILITY OF RECORDS; LIMITATION OF
ISSUES. (a) The records of a contested case hearing conducted
under this chapter are admissible in a trial under this subchapter
in accordance with the Texas Rules of Evidence.
(b)AAA trial under this subchapter is limited to issues
decided by the appeals panel and on which judicial review is
sought.AAThe pleadings must specifically set forth the
determinations of the appeals panel by which the party is
aggrieved.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.204, eff.
September 1, 2005.
Sec.A410.303.AABURDEN OF PROOF. The party appealing the
decision on an issue described in Section 410.301(a) has the burden
of proof by a preponderance of the evidence.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec. 410.304.AACONSIDERATION OF APPEALS PANEL DECISION. (a)
In a jury trial, the court, before submitting the case to the jury,
shall inform the jury in the court ’s instructions, charge, or
35
questions to the jury of the appeals panel decision on each disputed
issue described by Section 410.301(a) that is submitted to the
jury.
(b)AAIn a trial to the court without a jury, the court in
rendering its judgment on an issue described by Section 410.301(a)
shall consider the decision of the appeals panel.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.205, eff.
September 1, 2005.
Sec.A410.305.AACONFLICT WITH RULES OF CIVIL PROCEDURE. (a)
To the extent that this subchapter conflicts with the Texas Rules of
Civil Procedure or any other rules adopted by the supreme court,
this subchapter controls.
(b)AANotwithstanding Section 22.004, Government Code, or any
other law, the supreme court may not adopt rules in conflict with or
inconsistent with this subchapter.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec.A410.306.AAEVIDENCE. (a) Evidence shall be adduced as
in other civil trials.
(b)AAThe division on payment of a reasonable fee shall make
available to the parties a certified copy of the division ’s
record.AAAll facts and evidence the record contains are admissible
to the extent allowed under the Texas Rules of Evidence.
(c)AAExcept as provided by Section 410.307, evidence of
extent of impairment shall be limited to that presented to the
division.AAThe court or jury, in its determination of the extent of
impairment, shall adopt one of the impairment ratings under
Subchapter G, Chapter 408.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.206, eff.
September 1, 2005.
Sec.A410.307.AASUBSTANTIAL CHANGE OF CONDITION. (a)
36
Evidence of the extent of impairment is not limited to that
presented to the division if the court, after a hearing, finds that
there is a substantial change of condition.AAThe court ’s finding of
a substantial change of condition may be based only on:
(1)AAmedical evidence from the same doctor or doctors
whose testimony or opinion was presented to the division;
(2)AAevidence that has come to the party ’s knowledge
since the contested case hearing;
(3)AAevidence that could not have been discovered
earlier with due diligence by the party; and
(4)AAevidence that would probably produce a different
result if it is admitted into evidence at the trial.
(b)AAIf substantial change of condition is disputed, the
court shall require the designated doctor in the case to verify the
substantial change of condition, if any. The findings of the
designated doctor shall be presumed to be correct, and the court
shall base its finding on the medical evidence presented by the
designated doctor in regard to substantial change of condition
unless the preponderance of the other medical evidence is to the
contrary.
(c)AAThe substantial change of condition must be confirmable
by recognized laboratory or diagnostic tests or signs confirmable
by physical examination.
(d)AAIf the court finds a substantial change of condition
under this section, new medical evidence of the extent of
impairment must be from and is limited to the same doctor or doctors
who made impairment ratings before the division under Section
408.123.
(e)AAThe court ’s finding of a substantial change of condition
may not be made known to the jury.
(f)AAThe court or jury in its determination of the extent of
impairment shall adopt one of the impairment ratings made under
this section.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.207, eff.
September 1, 2005.
37
Sec.A410.308.AACERTIFIED COPY OF NOTICE SECURING
COMPENSATION. (a) The division shall furnish any interested party
in the claim with a certified copy of the notice of the employer
securing compensation with the insurance carrier, filed with the
division.
(b)AAThe certified copy of the notice is admissible in
evidence on trial of the claim pending and is prima facie proof of
the facts stated in the notice unless the facts are denied under
oath by the opposing party.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.208, eff.
September 1, 2005.
38
LABOR CODE
TITLE 5. WORKERS ’ COMPENSATION
SUBTITLE A. TEXAS WORKERS ’ COMPENSATION ACT
CHAPTER 414. ENFORCEMENT OF COMPLIANCE AND PRACTICE REQUIREMENTS
Sec.A414.002.AAMONITORING DUTIES. (a) The division shall
monitor for compliance with commissioner rules, this subtitle, and
other laws relating to workers ’ compensation the conduct of persons
subject to this subtitle.AAPersons to be monitored include:
(1)AApersons claiming benefits under this subtitle;
(2)AAemployers;
(3)AAinsurance carriers;
(4)AAattorneys and other representatives of parties;
and
(5)AAhealth care providers.
(b)AAThe division shall monitor conduct described by
Sections 415.001, 415.002, and 415.003 and refer persons engaging
in that conduct to the division of hearings.
(c)AAThe division shall monitor payments made to health care
providers on behalf of workers ’ compensation claimants who receive
medical services to ensure that the payments are made on time as
required by Section 408.027.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.260, eff.
September 1, 2005.
Sec. 414.003.AACOMPILATION AND USE OF INFORMATION. (a) The
division shall compile and maintain statistical and other
information as necessary to detect practices or patterns of conduct
by persons subject to monitoring under this chapter that:
(1)AAviolate this subtitle, commissioner rules, or a
commissioner order or decision; or
(2)AAotherwise adversely affect the workers ’
compensation system of this state.
(b)AAThe commissioner shall use the information compiled
under this section to impose appropriate penalties and other
1
sanctions under Chapters 415 and 416.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.261, eff.
September 1, 2005.
Sec.A414.004.AAPERFORMANCE REVIEW OF INSURANCE CARRIERS.
(a) The division shall review regularly the workers ’ compensation
records of insurance carriers as required to ensure compliance with
this subtitle.
(b)AAEach insurance carrier, the carrier ’s agents, and those
with whom the carrier has contracted to provide, review, or monitor
services under this subtitle shall:
(1)AAcooperate with the division;
(2)AAmake available to the division any records or
other necessary information; and
(3)AAallow the division access to the information at
reasonable times at the person ’s offices.
(c)AAThe insurance carrier, other than a governmental
entity, shall pay the reasonable expenses, including travel
expenses, of an auditor who audits the workers ’ compensation
records at the office of the insurance carrier.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Sec. 414.005.AAINVESTIGATION UNIT. (a)AAThe division shall
maintain an investigation unit to conduct investigations relating
to alleged violations of this subtitle, commissioner rules, or a
commissioner order or decision, with particular emphasis on
violations of Chapters 415 and 416.
(b)AAAs often as the commissioner considers necessary, the
commissioner or the investigation unit may review the operations of
a person regulated by the division, including an agent of the person
performing functions regulated by the division, to determine
compliance with this subtitle.
(c)AAThe review described by Subsection (b) may include
on-site visits to the person ’s premises.AAThe commissioner is not
required to announce an on-site visit in advance.
2
(d)AADuring an on-site visit, a person regulated by the
division shall make available to the division all records relating
to the person ’s participation in the workers ’ compensation system.
(e)AAThe commissioner by rule shall prescribe the procedures
to be used for both announced and unannounced on-site visits
authorized under this section, including specifying the types of
records subject to inspection.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.262, eff.
September 1, 2005.
Acts 2011, 82nd Leg., R.S., Ch. 1162 (H.B. 2605), Sec. 26,
eff. September 1, 2011.
Sec. 414.006.AAREFERRAL TO OTHER AUTHORITIES. For further
investigation or the institution of appropriate proceedings, the
division may refer the persons involved in a case subject to an
investigation toAAother appropriate authorities, including
licensing agencies, district and county attorneys, or the attorney
general.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.263, eff.
September 1, 2005.
Sec. 414.007.AAMEDICAL REVIEW. The division shall review
information concerning alleged violations of this subtitle
regarding the provision of medical benefits, commissioner rules, or
a commissioner order or decision, and, under Sections 414.005 and
414.006 and Chapters 415 and 416, may conduct investigations, make
referrals to other authorities, and initiate administrative
violation proceedings.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.264, eff.
September 1, 2005.
3
LABOR CODE
TITLE 5. WORKERS ’ COMPENSATION
SUBTITLE A. TEXAS WORKERS ’ COMPENSATION ACT
CHAPTER 415. ADMINISTRATIVE VIOLATIONS
SUBCHAPTER A. PROHIBITED ACTS
Sec. 415.001.AAADMINISTRATIVE VIOLATION BY REPRESENTATIVE OF
EMPLOYEE OR LEGAL BENEFICIARY. A representative of an employee or
legal beneficiary commits an administrative violation if the
person:
(1)AAfails without good cause to attend a dispute
resolution proceeding within the division;
(2)AAattends a dispute resolution proceeding within the
division without complete authority or fails to exercise authority
to effectuate an agreement or settlement;
(3)AAcommits an act of barratry under Section 38.12,
Penal Code;
(4)AAwithholds from the employee ’s or legal
beneficiary ’s weekly benefits or from advances amounts not
authorized to be withheld by the division;
(5)AAenters into a settlement or agreement without the
knowledge, consent, and signature of the employee or legal
beneficiary;
(6)AAtakes a fee or withholds expenses in excess of the
amounts authorized by the division;
(7)AArefuses or fails to make prompt delivery to the
employee or legal beneficiary of funds belonging to the employee or
legal beneficiary as a result of a settlement, agreement, order, or
award;
(8)AAviolates the Texas Disciplinary Rules of
Professional Conduct of the State Bar of Texas;
(9)AAmisrepresents the provisions of this subtitle to
an employee, an employer, a health care provider, or a legal
beneficiary;
(10)AA violates a commissioner rule; or
(11)AAfails to comply with this subtitle.
1
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.265, eff.
September 1, 2005.
Sec. 415.002.AAADMINISTRATIVE VIOLATION BY INSURANCE
CARRIER. (a) An insurance carrier or its representative commits an
administrative violation if that person:
(1)AAmisrepresents a provision of this subtitle to an
employee, an employer, a health care provider, or a legal
beneficiary;
(2)AAterminates or reduces benefits without
substantiating evidence that the action is reasonable and
authorized by law;
(3)AAinstructs an employer not to file a document
required to be filed with the division;
(4)AAinstructs or encourages an employer to violate a
claimant ’s right to medical benefits under this subtitle;
(5)AAfails to tender promptly full death benefits if a
legitimate dispute does not exist as to the liability of the
insurance carrier;
(6)AAallows an employer, other than a self-insured
employer, to dictate the methods by which and the terms on which a
claim is handled and settled;
(7)AAfails to confirm medical benefits coverage to a
person or facility providing medical treatment to a claimant if a
legitimate dispute does not exist as to the liability of the
insurance carrier;
(8)AAfails, without good cause, to attend a dispute
resolution proceeding within the division;
(9)AAattends a dispute resolution proceeding within the
division without complete authority or fails to exercise authority
to effectuate agreement or settlement;
(10)AAadjusts a workers ’ compensation claim in a manner
contrary to license requirements for an insurance adjuster,
including the requirements of Chapter 4101, Insurance Code, or the
rules of the commissioner of insurance;
2
(11)AAfails to process claims promptly in a reasonable
and prudent manner;
(12)AAfails to initiate or reinstate benefits when due
if a legitimate dispute does not exist as to the liability of the
insurance carrier;
(13)AAmisrepresents the reason for not paying benefits
or terminating or reducing the payment of benefits;
(14)AAdates documents to misrepresent the actual date
of the initiation of benefits;
(15)AAmakes a notation on a draft or other instrument
indicating that the draft or instrument represents a final
settlement of a claim if the claim is still open and pending before
the division;
(16)AAfails or refuses to pay benefits from week to week
as and when due directly to the person entitled to the benefits;
(17)AAfails to pay an order awarding benefits;
(18)AAcontroverts a claim if the evidence clearly
indicates liability;
(19)AAunreasonably disputes the reasonableness and
necessity of health care;
(20)AAviolates a commissioner rule;
(21)AAmakes a statement denying all future medical care
for a compensable injury; or
(22)AAfails to comply with a provision of this
subtitle.
(b)AAAn insurance carrier or its representative does not
commit an administrative violation under Subsection (a)(6) by
allowing an employer to:
(1)AAfreely discuss a claim;
(2)AAassist in the investigation and evaluation of a
claim; or
(3)AAattend a proceeding of the division and
participate at the proceeding in accordance with this subtitle.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1995, 74th Leg., ch. 980, Sec. 1.45, eff. Sept. 1, 1995.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.266, eff.
3
September 1, 2005.
Sec. 415.003.AAADMINISTRATIVE VIOLATION BY HEALTH CARE
PROVIDER. A health care provider commits an administrative
violation if the person:
(1)AAsubmits a charge for health care that was not
furnished;
(2)AAadministers improper, unreasonable, or medically
unnecessary treatment or services;
(3)AAmakes an unnecessary referral;
(4)AAviolates the division ’s fee and treatment
guidelines;
(5)AAviolates a commissioner rule; or
(6)AAfails to comply with a provision of this subtitle.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1995, 74th Leg., ch. 980, Sec. 1.45, eff. Sept. 1, 1995.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.267, eff.
September 1, 2005.
Sec.A415.0035.AAADDITIONAL VIOLATIONS BY INSURANCE CARRIER
OR HEALTH CARE PROVIDER. (a) An insurance carrier or its
representative commits an administrative violation if that person:
(1)AAfails to submit to the division a settlement or
agreement of the parties;
(2)AAfails to timely notify the division of the
termination or reduction of benefits and the reason for that
action; or
(3)AAdenies preauthorization in a manner that is not in
accordance with rules adopted by the commissioner under Section
413.014.
(b)AAA health care provider commits an administrative
violation if that person:
(1)AAfails or refuses to timely file required reports
or records; or
(2)AAfails to file with the division the annual
disclosure statement required by Section 413.041.
4
(c)AARepealed by Acts 2011, 82nd Leg., R.S., Ch. 1162, Sec.
37(2), eff. September 1, 2011.
(d)AARepealed by Acts 2011, 82nd Leg., R.S., Ch. 1162, Sec.
37(2), eff. September 1, 2011.
(e)AAA person regulated by the division under this title
commits an administrative violation if the person violates this
subtitle or a rule, order, or decision of the commissioner.
(f)AARepealed by Acts 2011, 82nd Leg., R.S., Ch. 1162, Sec.
37(2), eff. September 1, 2011.
Added by Acts 1995, 74th Leg., ch. 980, Sec. 1.45, eff. Sept. 1,
1995. Amended by Acts 2001, 77th Leg., ch. 1456, Sec. 6.06, eff.
June 17, 2001.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.268, eff.
September 1, 2005.
Acts 2011, 82nd Leg., R.S., Ch. 1162 (H.B. 2605), Sec. 27,
eff. September 1, 2011.
Acts 2011, 82nd Leg., R.S., Ch. 1162 (H.B. 2605), Sec. 37(2),
eff. September 1, 2011.
Sec. 415.0036.AAADMINISTRATIVE VIOLATION BY PERSON
PERFORMING CERTAIN CLAIM SERVICES. (a) This section applies to an
insurance adjuster, case manager, or other person who has authority
under this title to request the performance of a service affecting
the delivery of benefits to an injured employee or who actually
performs such a service, including peer reviews, performance of
required medical examinations, or case management.
(b)AAA person described by Subsection (a) commits an
administrative violation if the person offers to pay, pays,
solicits, or receives an improper inducement relating to the
delivery of benefits to an injured employee or improperly attempts
to influence the delivery of benefits to an injured employee,
including through the making of improper threats. This section
applies to each person described by Subsection (a) who is a
participant in the workers ’ compensation system of this state and
to an agent of such a person.
(c)AARepealed by Acts 2011, 82nd Leg., R.S., Ch. 1162, Sec.
5
37(3), eff. September 1, 2011.
Added by Acts 2007, 80th Leg., R.S., Ch. 198 (H.B. 34), Sec. 1, eff.
September 1, 2007.
Amended by:
Acts 2011, 82nd Leg., R.S., Ch. 1162 (H.B. 2605), Sec. 37(3),
eff. September 1, 2011.
Sec.A415.005.AAOVERCHARGING BY HEALTH CARE PROVIDERS
PROHIBITED; ADMINISTRATIVE VIOLATION. (a) A health care provider
commits a violation if the person charges an insurance carrier an
amount greater than that normally charged for similar treatment to
a payor outside the workers ’ compensation system, except for
mandated or negotiated charges.
(b)AAA violation under this section is an administrative
violation.AAA health care provider may be liable for an
administrative penalty regardless of whether a criminal action is
initiated under Section 413.043.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.269, eff.
September 1, 2005.
Sec.A415.006.AAEMPLOYER CHARGEBACKS PROHIBITED;
ADMINISTRATIVE VIOLATION. (a) An employer may not collect from an
employee, directly or indirectly, a premium or other fee paid by the
employer to obtain workers ’ compensation insurance coverage,
except as provided by Sections 406.123 and 406.144.
(b)AAAn employee or legal beneficiary of an employee has a
right of action to recover damages against an employer who violates
Subsection (a).
(c)AAA person commits an administrative violation if the
person violates Subsection (a).
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.270, eff.
September 1, 2005.
6
Sec.A415.007.AALOANS BY ATTORNEYS PROHIBITED. (a) An
attorney who represents a claimant before the division may not lend
money to the claimant during the pendency of the workers ’
compensation claim.
(b)AAThe attorney may assist the claimant in obtaining
financial assistance from another source if the attorney is not
personally liable for the credit extended to the claimant.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.271, eff.
September 1, 2005.
Sec.A415.008.AAFRAUDULENTLY OBTAINING OR DENYING BENEFITS;
ADMINISTRATIVE VIOLATION. (a)AAA person commits an administrative
violation if the person, to obtain or deny a payment of a workers ’
compensation benefit or the provision of a benefit for the person or
another, knowingly or intentionally:
(1)AAmakes a false or misleading statement;
(2)AAmisrepresents or conceals a material fact;
(3)AAfabricates, alters, conceals, or destroys a
document; or
(4)AAconspires to commit an act described by
Subdivision (1), (2), or (3).
(b)AARepealed by Acts 2011, 82nd Leg., R.S., Ch. 1162, Sec.
37(5), eff. September 1, 2011.
(c)AAA person who has obtained an excess payment in violation
of this section is liable for full repayment plus interest computed
at the rate prescribed by Section 401.023. If the person is an
employee or person claiming death benefits, the repayment may be
redeemed from future income or death benefits to which the person is
otherwise entitled.
(d)AAAn employer who has committed an act described by
Subsection (a) that results in denial of payments is liable for the
past benefit payments that would otherwise have been payable by the
insurance carrier during the period of denial, plus interest
computed at the rate prescribed by Section 401.023. The insurance
carrier is not liable for benefit payments during the period of
7
denial.
(e)AAIf an administrative violation proceeding is pending
under this section against an employee or person claiming death
benefits, the division may not take final action on the person ’s
benefits.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.272, eff.
September 1, 2005.
Acts 2011, 82nd Leg., R.S., Ch. 1162 (H.B. 2605), Sec. 28,
eff. September 1, 2011.
Acts 2011, 82nd Leg., R.S., Ch. 1162 (H.B. 2605), Sec. 37(5),
eff. September 1, 2011.
Sec. 415.009.AAFRIVOLOUS ACTIONS; ADMINISTRATIVE
VIOLATION.AA A person commits an administrative violation if the
person brings, prosecutes, or defends an action for benefits under
this subtitle or requests initiation of an administrative violation
proceeding that does not have a basis in fact or is not warranted by
existing law or a good faith argument for the extension,
modification, or reversal of existing law.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.273, eff.
September 1, 2005.
Acts 2011, 82nd Leg., R.S., Ch. 1162 (H.B. 2605), Sec. 29,
eff. September 1, 2011.
Sec. 415.010.AABREACH OF AGREEMENT; ADMINISTRATIVE
VIOLATION.AA A party to an agreement approved by the division
commits an administrative violation if the person breaches a
provision of the agreement.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.274, eff.
September 1, 2005.
Acts 2011, 82nd Leg., R.S., Ch. 1162 (H.B. 2605), Sec. 29,
8
eff. September 1, 2011.
Sec. 415.011.AANOTICE OF PROFESSIONAL EMPLOYER ORGANIZATION
WORKERS ’ COMPENSATION CLAIM AND PAYMENT INFORMATION;
ADMINISTRATIVE VIOLATION. (a)AAIn this section, "license holder"
has the meaning assigned by Section 91.001.
(a-1)AAExcept as provided by Subsection (c), a license holder
commits a violation if the license holder fails to provide the
information required by Sections 91.042(g) and (h).
(b)AAA violation under Subsection (a) is an administrative
violation.
(c)AAA license holder does not commit an administrative
violation under this section if the license holder requested the
information required by Sections 91.042(g) and (h) from the license
holder ’s workers ’ compensation insurance provider and the provider
does not provide the information to the license holder within the
required time.AAA license holder shall notify the Texas Department
of Insurance of a provider ’s failure to comply with the
requirements of Section 2051.151, Insurance Code.
Added by Acts 2011, 82nd Leg., R.S., Ch. 477 (H.B. 625), Sec. 3,
eff. September 1, 2011.
Amended by:
Acts 2013, 83rd Leg., R.S., Ch. 117 (S.B. 1286), Sec. 20, eff.
September 1, 2013.
Acts 2013, 83rd Leg., R.S., Ch. 117 (S.B. 1286), Sec. 21, eff.
September 1, 2013.
SUBCHAPTER B. SANCTIONS
Sec. 415.021.AAASSESSMENT OF ADMINISTRATIVE PENALTIES.
(a)AAIn addition to any other provisions in this subtitle relating
to violations, a person commits an administrative violation if the
person violates, fails to comply with, or refuses to comply with
this subtitle or a rule, order, or decision of the commissioner,
including an emergency cease and desist order issued under Section
415.0211.AAIn addition to any sanctions, administrative penalty,
or other remedy authorized by this subtitle, the commissioner may
9
assess an administrative penalty against a person who commits an
administrative violation.AAThe administrative penalty shall not
exceed $25,000 per day per occurrence.AAEach day of noncompliance
constitutes a separate violation.AAThe commissioner ’s authority
under this chapter is in addition to any other authority to enforce
a sanction, penalty, fine, forfeiture, denial, suspension, or
revocation otherwise authorized by law.
(b)AAThe commissioner may enter a cease and desist order
against a person who:
(1)AAcommits repeated administrative violations;
(2)AAallows, as a business practice, the commission of
repeated administrative violations; or
(3)AAviolates an order or decision of the commissioner.
(c)AAIn assessing an administrative penalty:
(1)AAthe commissioner shall consider:
(A)AAthe seriousness of the violation, including
the nature, circumstances, consequences, extent, and gravity of the
prohibited act;
(B)AAthe history and extent of previous
administrative violations;
(C)AAthe demonstrated good faith of the violator,
including actions taken to rectify the consequences of the
prohibited act;
(D)AAthe penalty necessary to deter future
violations; and
(E)AAother matters that justice may require; and
(2)AAthe commissioner shall, to the extent reasonable,
consider the economic benefit resulting from the prohibited act.
(d)AAA penalty may be assessed only after the person charged
with an administrative violation has been given an opportunity for
a hearing under Subchapter C.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 2001, 77th Leg., ch. 1456, Sec. 6.07, eff. June 17, 2001.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.275, eff.
September 1, 2005.
Acts 2011, 82nd Leg., R.S., Ch. 1162 (H.B. 2605), Sec. 31,
10
eff. September 1, 2011.
Sec. 415.0211.AAEMERGENCY CEASE AND DESIST ORDER. (a)AAThe
commissioner ex parte may issue an emergency cease and desist order
if:
(1)AAthe commissioner believes a person regulated by
the division under this title is engaging in conduct violating a
law, rule, or order; and
(2)AAthe commissioner believes that the alleged conduct
under Subdivision (1) will result in harm to the health, safety, or
welfare of another person.
(b)AAOn issuance of an order under Subsection (a), the
commissioner shall serve on the affected person an order that
contains a statement of the charges and requires the person
immediately to cease and desist from the acts, methods, or
practices stated in the order.AAThe commissioner shall serve the
order by registered or certified mail, return receipt requested, to
the affected person ’s last known address.AAThe order is final on
the 31st day after the date the affected person receives the order,
unless the affected person requests a hearing under Subsection (c).
(c)AAA person affected by an order is entitled to request a
hearing to contest the order.AAThe affected person must request the
hearing not later than the 30th day after the date the person
receives the order required by Subsection (b).AAA request to
contest an order must:
(1)AAbe in writing;
(2)AAbe directed to the commissioner; and
(3)AAstate the grounds for the request to set aside or
modify the order.
(d)AAOn receiving a request for a hearing, the commissioner
shall serve notice of the time and place of the hearing.AAThe
hearing is subject to the procedures for a contested case under
Chapter 2001, Government Code.AAThe hearing shall be held not later
than the 10th day after the date the commissioner receives the
request for a hearing unless the parties mutually agree to a later
hearing date.AAAt the hearing, the person requesting the hearing is
entitled to show cause why the order should not be
11
affirmed.AAFollowing receipt of the proposal for decision from the
State Office of Administrative Hearings regarding the hearing, the
commissioner shall wholly or partly affirm, modify, or set aside
the order.
(e)AAPending a hearing under this section, an order continues
in effect unless the order is stayed by the commissioner.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1162 (H.B. 2605), Sec. 32,
eff. September 1, 2011.
Sec. 415.0215.AASANCTIONS. (a)AAThe division may impose
sanctions against any person regulated by the division under this
subtitle.
(b)AAOnly the commissioner may impose:
(1)AAa sanction that deprives a person of the right to
practice before the division or of the right to receive
remuneration under this subtitle for a period exceeding 30 days; or
(2)AAanother sanction suspending for more than 30 days
or revoking a license, certification, or permit required for
practice in the field of workers ’ compensation.
(c)AAA sanction imposed by the division is binding pending
appeal.
Transferred and redesignated from Labor Code, Section 402.072 by
Acts 2011, 82nd Leg., R.S., Ch. 1162 (H.B. 2605), Sec. 33, eff.
September 1, 2011.
Sec.A415.023.AACOMMISSION OF WRONGFUL ACT AS MATTER OF
PRACTICE; ADMINISTRATIVE VIOLATION. (a) A person who commits an
administrative violation under Section 415.001, 415.002, 415.003,
or 415.0035 as a matter of practice is subject to an applicable rule
adopted under Subsection (b) in addition to the penalty assessed
for the violation.
(b)AAThe commissioner may adopt rules providing for:
(1)AAa reduction or denial of fees;
(2)AApublic or private reprimand by the commissioner;
(3)AAsuspension from practice before the division;
(4)AArestriction, suspension, or revocation of the
right to receive reimbursement under this subtitle; or
12
(5)AAreferral and petition to the appropriate licensing
authority for appropriate disciplinary action, including the
restriction, suspension, or revocation of the person ’s license.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 2001, 77th Leg., ch. 1456, Sec. 6.08, eff. June 17, 2001.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.276, eff.
September 1, 2005.
Sec. 415.024.AABREACH OF SETTLEMENT AGREEMENT;
ADMINISTRATIVE VIOLATION. A material and substantial breach of a
settlement agreement that establishes a compliance plan is an
administrative violation.AAIn determining the amount of the
penalty, the commissioner shall consider the total volume of claims
handled by the insurance carrier.
Added by Acts 1997, 75th Leg., ch. 1443, Sec. 9, eff. Sept. 1, 1997.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.277, eff.
September 1, 2005.
Sec. 415.025.AAREFERENCES TO A CLASS OF VIOLATION OR
PENALTY.AAA reference in this code or other law, or in rules of the
former Texas Workers ’ Compensation Commission or the commissioner,
to a particular class of violation, administrative violation, or
penalty shall be construed as a reference to an administrative
penalty.AAAn administrative penalty may not exceed $25,000 per day
per occurrence.AAEach day of noncompliance constitutes a separate
violation.
Added by Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.278, eff.
September 1, 2005.
Amended by:
Acts 2011, 82nd Leg., R.S., Ch. 1162 (H.B. 2605), Sec. 34,
eff. September 1, 2011.
SUBCHAPTER C. PROCEDURES
Sec. 415.031.AAINITIATION OF ADMINISTRATIVE VIOLATION
13
PROCEEDINGS. Any person may request the initiation of
administrative violation proceedings by filing a written
allegation with the division.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.279, eff.
September 1, 2005.
Sec. 415.032.AANOTICE OF POSSIBLE ADMINISTRATIVE VIOLATION;
RESPONSE. (a)AAIf investigation by the division indicates that an
administrative violation has occurred, the division shall notify
the person alleged to have committed the violation in writing of:
(1)AAthe charge;
(2)AAthe proposed sanction;
(3)AAthe right to consent to the charge and the
sanction; and
(4)AAthe right to request a hearing.
(b)AANot later than the 20th day after the date on which
notice is received, the charged party shall:
(1)AAremit the amount of the sanction to the division or
otherwise consent to the imposed sanction; or
(2)AAsubmit to the division a written request for a
hearing.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.280, eff.
September 1, 2005.
Acts 2011, 82nd Leg., R.S., Ch. 1162 (H.B. 2605), Sec. 34,
eff. September 1, 2011.
Sec. 415.033.AAFAILURE TO RESPOND.AAIf, without good cause,
a charged party fails to respond as required under Section 415.032,
the division shall initiate enforcement proceedings.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.281, eff.
September 1, 2005.
14
Acts 2011, 82nd Leg., R.S., Ch. 1162 (H.B. 2605), Sec. 34,
eff. September 1, 2011.
Sec. 415.034.AAHEARING PROCEDURES.AA On the request of the
charged party or the commissioner, the State Office of
Administrative Hearings shall set a hearing.AAThe hearing shall be
conducted in the manner provided for a contested case under Chapter
2001, Government Code (the administrative procedure law).
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
by Acts 1995, 74th Leg., ch. 76, Sec. 5.95(49), eff. Sept. 1, 1995;
Acts 1995, 74th Leg., ch. 980, Sec. 1.46, eff. Sept. 1, 1995.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.282, eff.
September 1, 2005.
Acts 2011, 82nd Leg., R.S., Ch. 1162 (H.B. 2605), Sec. 34,
eff. September 1, 2011.
Sec.A415.035.AAJUDICIAL REVIEW. (a) A decision under
Section 415.034 is subject to judicial review in the manner
provided for judicial review under Chapter 2001, Government Code.
(b)AAIf an administrative penalty is assessed, the person
charged shall:
(1)AAforward the amount of the penalty to the division
for deposit in an escrow account; or
(2)AApost with the division a bond for the amount of the
penalty, effective until all judicial review of the determination
is final.
(c)AAFailure to comply with Subsection (b) results in a
waiver of all legal rights to contest the violation or the amount of
the penalty.
(d)AAIf the court determines that the penalty should not have
been assessed or reduces the amount of the penalty, the division
shall:
(1)AAremit the appropriate amount, plus accrued
interest, if the administrative penalty was paid; or
(2)AArelease the bond.
Acts 1993, 73rd Leg., ch. 269, Sec. 1, eff. Sept. 1, 1993. Amended
15
by Acts 1995, 74th Leg., ch. 76, Sec. 5.95(49), eff. Sept. 1, 1995.
Amended by:
Acts 2005, 79th Leg., Ch. 265 (H.B. 7), Sec. 3.283, eff.
September 1, 2005.
Sec. 415.036.AASTANDARD OF JUDICIAL REVIEW OF COMMISSIONER ’S
ORDER.AAAn order of the commissioner is subject to judicial review
under the substantial evidence rule.
Added by Acts 2011, 82nd Leg., R.S., Ch. 1162 (H.B. 2605), Sec. 35,
eff. September 1, 2011.
16