Office of House Bill AnalysisH.B. 300
By: Burnam
Economic Development


Current law prohibits retaliation against public employees who report
violations of law by the employing governmental entity or another public
employee.  However, private sector employees who report illegal acts are
only protected in certain circumstances and risk losing their jobs.  House
Bill 300 prohibits an employer of five or more employees from
discriminating against an employee who reports a violation of law and sets
forth procedures for an employee who experiences such discrimination to
seek relief and compensation. 


It is the opinion of the Office of House Bill Analysis that rulemaking
authority is expressly delegated to the Texas Workforce Commission in
SECTION 1 (Section 25.010, Labor Code) of this bill. 


House Bill 300 amends the Labor Code to prohibit an employer of five or
more employees from suspending, demoting, terminating the employment of, or
otherwise discriminating against an employee because the employee has
reported activities within the workplace that constitute a violation of the
law. The bill provides that the employee make the complaint in good faith
and to an appropriate law enforcement authority or a supervisor, officer,
or other appropriate person who exercises managerial authority for the
employer.  An employer in violation of these provisions is liable for a
civil penalty not to exceed $500.  The bill authorizes the attorney general
or an appropriate prosecuting attorney to sue to collect the penalty which
is required to be deposited in the state treasury.   

An employee whose employment is terminated or suspended, who has been
demoted, or who has been otherwise discriminated against by an employer is
entitled to: 

 _sue for injunctive relief, actual damages, court costs, and reasonable
attorney's fees; 
 _reinstatement to the employee's former position or a comparable position
in terms of compensation, benefits, and other conditions of employment; 

 _compensation for wages lost during the period of suspension, demotion,
termination, or discrimination; and 

 _reinstatement of any fringe benefits and seniority rights lost because of
the suspension, demotion, termination, or discrimination. 

The bill provides that an employee must sue not later than the 90th day
after the date on which the alleged violation occurred or was discovered by
the employee through reasonable diligence.  The bill provides the following
exceptions to this provision: 

 _an employee must exhaust the employer's grievance or appeal procedure,
relating to the  suspension, demotion, termination, or discrimination
before suing; 

 _the employee must invoke the grievance or appeal procedures not later
than the 90th day after the date on which the alleged violation occurred or
was discovered by the employee through reasonable diligence; and 

 _an employee is authorized to bring suit on or after the 31st day after
the date on which the employee initiates the grievance on appeal if a final
decision is not rendered before the 31st day after the date of the

The bill further provides that an employee is authorized to sue in a
district court of the county in which the employee resides, and has the
burden of proof unless the employee was terminated, suspended, or demoted
within 90 days after the date on which the employee reported a violation of
law.  The bill requires that each employer inform its employees of their
rights under these provisions by posting a conspicuous sign in the
workplace.  The Texas Workforce Commission (TWC) is required to prescribe,
by rule, the design and content of the sign.  The bill authorizes TWC to
collect a reasonable fee from employers subject to these provisions to
cover costs incurred in administering these provisions. 


September 1, 2001.