                                                                                                   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	  
                                                                                            	  
	                                              	  




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                                      EXHIBIT	  
                                            	  
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PLAINTIFFS’	  FIFTH	  AMENDED	  PETITION	  &	  REQUESTS	  FOR	  DISCLOSURE	     32	  
WMRA 000022
WMRA 000023
WMRA 000024
WMRA 000025
WMRA 000026
WMRA 000027
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WMRA 000029
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                                      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	  –	  facsimile	  
                                                                                281-­‐973-­‐2772	  –	  phone	  
                                                                                bjg@gildelawfirm.com	  
                                                                                nah@gildelawfirm.com	  
                                                                                	  
                                                                                MATTHEWS	  &	  ASSOCIATES	  
                                                                                DAVID	  P.	  MATTHEWS	  
                                                                                2905	  Sackett	  Street	  
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                                                                                713-­‐522-­‐5250	  –	  phone	  
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                                                                                THE	  GALLAGHER	  LAW	  FIRM,	  LLP	  
                                                                                MIKE	  GALLAGHER	  
                                                                                2905	  Sackett	  Street	  
                                                                                Houston,	  TX	  77098	  
                                                                                713-­‐238-­‐7705	  –	  phone	  
                                                                                713-­‐222-­‐0066	  –	  facsimile	  
                                                                                ATTORNEYS	  FOR	  PLAINTIFFS	  
	  
                                                             CERTIFICATE	  OF	  SERVICE	  
                                                                                	  
            I	  hereby	  certify	  that	  a	  true	  and	  correct	  copy	  of	  the	  foregoing	  has	  been	  served	  to	  all	  counsel	  of	  
record	  via	  facsimile	  and/or	  eTexFile	  on	  February	  19,	  2015.	  	  
	  
                                                                             Respectfully	  
                                                                                            1. submitted,	  
                                                                                                    	  



                                                                                                              	  
                                                                                Nicholas	  A.	  Homan	  
PLAINTIFFS’	  RESPONSE	  TO	  IWORKS	  DEFENDANTS’	  PLEA	  TO	  THE	  JURISDICTION	                                                                    25	  
    	  
    	  
    	  
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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
<<Prev Rule            Texas Administrative Code                                       Next Rule>>

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.


<<Prev Rule           Texas Administrative Code                                     Next Rule>>

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.


                                               13
         (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.




                                      14
                                          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


                                           2
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.




                                           3
         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.


                                          79
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,


                                     80
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.


                                             81
         (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


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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,


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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


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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


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              (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


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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.


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         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


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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.




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