                 THE         ATTORNEY    GENERAL
                                OF TEXAS
                              AUSTIN.      TIZSAS        '7SVll




                                        June 18, 1975


The Honorable Joe E. Lassiter,  Chairman
Texas Private Employment   Agency                               Opinion No.   H-   629
Regulatory  Board
Box 12157, Capitol Station                                      Re:   Does the Texas Private
Austin,  Texas 78711                                                  Employment    Agency
                                                                      Regulatory   Board have
                                                                      authority to determine
                                                                      the circumstances    in
                                                                      which “temporary    employ-
                                                                      ment” fees will be charged
                                                                      by licensed private employ-
Dear Mr.         Lassiter:                                            ment agencies.

     You have requested an opinion to determine whether the Texas Private
Employment Agency Regulatory        Board had authority to promulgate    certain
rules prescribing   the fee in circumstances   where an applicant has obtained
employment through an agency and is then separated from employment            within
thirty days.   You direct our attention,   in particular, to section 3(d) of those
rules.   The rules,   in part, are as follows:

        Temporary            Employment        Service   Fees    to Applicants

        In the event an applicant accepts a position through
        an employment    agency and such employment    lasts
        less than 30 days, such employment    will be con-
        sidered ‘temporary    employment’ and the following
        regulations  will apply:

       1. The agency will charge the applicant no more
       than 20% of the applicant’s   gross earnings pro-
       vided the applicant terminates    the position for ‘good
       cause’ within the first thirty days of employment.

        .    .   .


        3.  The applicant will be considered    ‘at fault’ aad
        thus excluded from the provisions    of this ruling, when
        termination  occurs for any of the following reasons:

                                          p.   2783
The Honorable,     Joe E.   Lassiter,        page 2   (H-629)




        . .   .


       d. Job termination    caused by the applicant’s
       failure to report to work, after accepting a
       position,  unless the applicant notifies the agency
       of this decision prior to the mutually agreed
       s~tarting time and date.

   Your   letter   of’ request   advises:

        . . . [T]his result is contrary to the custom and
        contractual  practice which has developed throughout
        the years in the private employment   agency business
        . . .

           The question presented here is whether or not
       under the provisions   of Section 15 of Article 5221a-6
       RCS, the Board had the prerequisite     authority to
       promulgate  such rule.    Furthermore,     does such rule
       in any way contravene    any of the provisions  of the
       Texas Constitution.

        . .   .


            It has been the custom and contractual practice in
        the operation   of a private employment   agency business
        in this State and most other states to consider that the
        agency had earned its service fee from an applicant
        (on those jobs where the fee is to be paid by the applicant)
        at the time when an employer    offers to employ the appli-
        cant and the applicant agrees to accept such employment
        from the employer.      Custom and contractual practice
        has been that the fee at this point in time is 100% earned
        by the agency.

     The Texas Private Employment       Agency Regulatory    Board was created by
article 5221a-6,   V. T. C. S., the Private Employment     Agency Law, when that
statute was amended by Acts 1969, 61st Leg.,        ch. 871, p. 2625.    The under-
lying purpose of the amended statute was said by Attorney General Opinion
M-750   (1970) to be ” . . . to protect those seeking employment      from exploita-
tion by an employment      agency that might be tempted to take advantage . , . of
the employment     seeker.   . . . ‘I Among other things, section 13(a) of the statute
expressly   forbids licensed employment     agencies to:

                                        p.   2784
The Honorable    Joe E.   Lassiter,      page 3   (H-629)




           (1) impose any fees for the registration  of
       applicants for employment   or any other fee of
       applicants except for the furnishing of employ-
       ment referrals  which result in the applicant
       obtaining employment;

       . .   *


           (3) charge a fee greater than that authorized
       and promulgated  by the Board:

           (4) make, give, or cause to be made or given
       to any applicant for employees      or employment
       any false promise,     misrepresentation    or inaccurate
       or misleading    statement or information     if such
       agency had knowledge or should have had knowledge
       of such falsity,   misrepresentation,    or inaccurate
       or misleading    statement or information;
       . . .

     The powers of the Board are set out in section         15 of the statute,   sub-
sections (a) and (c) of which read:

           (a) The board is authorized to establish and
       promulgate  a schedule of permissible   maximum
       fees allowed to be charged to applicants by private
       employment   agencies in the performance    of their
       services.
       . . .

            (c) The board shall promulgate       procedural
       rules and regulations     only. consistent with the
       provisions   of this Act, to govern the conduct of
       its business and proceedings.        Notwithstanding   any
       other provisions    of this Act, the board shall not
       have any power or authority to amend or enlarge
       upon any provision     of this Act by rule or regulation
       to change the meaning in any manner whatsoever           of
       any provision    of this Act or to promulgate      any rule
       or regulation which is in any way contrary to the
       underlying and fundamental purposes of this Act or
       to make any rule or regulation which is unreasonable,
       arbitrary,   capricious,    illegal, or unnecessary.

                                      p. 2785
The Honorable   Joe E.   Lassiter,        page 4     (H-629)




     If it is within the power of the Board to establish a different fee
schedule for permanent       positions and temporary positions,    as we
think it is, we believe it is within the power of the Board to define
“permanent      employment”     and “temporary  employment.    ” The portion
of the rule set out above does no more than determine under what
circumstances      an applicant will be charged “temporary      employment”
fees.    If he terminates   the position for good cause,  as defined by the
rules, within thirty days of being employed,       an applicant is to be
charged “temporary        employment”   fees.  When he terminates    the
employment before reporting to work as agreed even “good cause” will
not suffice to relieve him of a fee obligation unless he has timely advised
the agency.

     In our opinion this promulgation   by the Board is well within the under-
lying purpose of the statute and the delegated power of the Board to
establish and promulgate    a schedule of maximum     fees allowed to be charged
applicants by private employment      agencies “in the performance   of their
services.  ”

    We also think it is within the power of the Board, to promulgate
reasonable   rules that no fee is due for the performance    of a service which
results in the applicant accepting employment     but “for good cause” not
reporting for work.     We cannot say the Board’s action here was “unreason-
able, arbitrary,   capricious  . . . or unnecessary,  ” Those are questions
of fact.

    You have also asked if the rules contravene any provision     of the Texas
Constitution.  You have not suggested any specific constitutional    problem,
and we know of none.

                               SUMMARY

           It is within the power of the Texas Private Employment
       Agency Regulatory    Board to prescribe   fees to be charged
       by private employment     agencies in circumstances   where an
       applicant has obtained employment     through an agency and is
       then separated from employment      within 30 days.

                                                   ry truly yours,

                                                     A?*
                                              OHN L. HILL
                                             Attorney General        of Texas
                                      &
                                     p.   2786
The Honorable   Joe E.   Lassiter,        page   5   (H-629)




APPROVED:




C. ‘ROBERT HEATH,        Chairman
Opinion Committee




                                     p.   2787
