Texas Labor Laws

Updated: 03/06/2020

Texas Minimum Wage

Texas currently follows federal minimum wage rates, which are $7.25 per hour and were set as of July 24, 2009.

USA map with Texas superimposed

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History of Texas Labor Laws

Texas had early struggles with organized labor.

A strike in 1885 against the Wabash Railroad by the first labor union in Texas, the Knights of Labor, drastically increased union membership in Texas, but it was short-lived.

A regional call to strike against the Texas and Pacific Railway only a few months later in March 1886 led to numerous violent outbreaks and clashes. Called the Great Southwest Strike, even the Texas Rangers were called in to deal with the violence of the union and railroad clashes.

This led to poor public opinion of the union and likely started the chain of events that led to Texas beginning work on its right to work laws even before the Taft-Hartley Act (also called the Labor Management Relations Act of 1947) went into effect.

Today, Texas labor laws not only protect the right to unionize, but also the right of a worker to refuse to join a union or pay union dues as a condition of employment.

Municipality Minimum Wage Laws

As of January 2020, Texas did not allow cities or counties to set minimum wage hourly rates different from the state minimum wage.

However, in an attempt to partially skirt the prohibition, San Antonio, Dallas and Austin have increased wages for public and private employees under contract to those cities.

  • Dallas began raising city contract worker wages in 2015, starting at $10.37 an hour with the rate tied to MIT's Wage Calculator.
  • Austin raised the minimum salary for full-time city employees to $15 per hour starting in 2018.
  • San Antonio began moving its city worker pay towards $15 per hour several years ago as well.

Mounting public opinion and actions like those of San Antonio, Dallas and Austin led to several pieces of legislation being introduced in the Texas state government to increase the state minimum wage to $15 per hour, although (as of February 2020), none of them had become law.

However, House Bill 328, which was still in committee as of February 2020, would allow cities to set true local minimum wage ordinances without relying on a statewide increase.

Texas Minimum Wage Exemptions

In addition to federal minimum wage exempt employees designation rules, Texas does exempt some other workers from minimum wage in certain circumstances.

Patients and clients of the Texas Department of Mental Health and Mental Retardation, those with productivity impairments, inmates of the Texas correctional system, and some minors are exempt from minimum wage or subject to alternative minimum wage rates.

Tipped employees can be paid a lower direct hourly rate before tips, but they must make at least minimum wage after tip credit, or the employer must pay the difference.

Further, Texas exempts domestic workers (such as babysitters or live-in caregivers) in private homes, those employing close family members, certain agricultural situations, and some religious or other non-profit organizations (such as the Boy Scouts) from the state minimum wage rules.

Some entertainment facilities operating for a limited time of the year are also exempt.

Texas Posting Requirements

In addition to federally required posters, Texas requires employers to include certain state posters in an easily visible location to employees.

These posters include the Texas payday law notice, state unemployment compensation insurance information, workers' compensation posters and Earned Income Tax Credit information.

Further, public employers must also display information on the Texas Whistleblower Act, the Texas Hazard Communication Program, and the Job Service complaint system.

Required Posters:

  • Child Labor
  • Fair Employment (English/Spanish)
  • Ombudsman Notice
  • Payday Notice
  • Unemployment and Payday Law
  • Workers' Compensation
  • Workers' Compensation (Uninsured)

Additional Posters:

  • Hazcom Notice (Public Sector Only)
  • Whistleblowers' Protection Act (Public Sector Only)

Tipped Wage in Texas

Texas allows tipped workers (those receiving more than $20 a month in tips on a regular basis) to be paid an initial direct pay lower minimum wage rate of $5.12 (as of 2020) per hour before tips.

Mandatory service fees are federally considered to be separate from tips, and any part of a mandatory service fee passed on to employees must be treated as wages, not tips.

As with federal law, tips plus the amount paid by the employer must at least equal normal minimum pay, or the employer must pay the difference so that the employee receives at least the full $7.25 per hour minimum wage rate after everything is added together.

Also, following federal law, if employers have employees who are normally tipped but perform some non-tipped duties (such as dishwashing adjacent to tipped activities), the employer may apply a tip credit to those non-tipped duty hours as well.

Tip pooling and service fee handling follow federal rules as well, and employees may not be required to turn over any tips to an employer regardless of tip credits taken or starting wage paid except as part of a valid tip pool agreement.

Overtime Wage in Texas

Texas follows the federal Fair Labor Standards Act (FLSA) overtime pay rules and classification of exempt or non-exempt employees.

Overtime must be paid for non-exempt workers for any hours worked over 40 in a workweek. The pay rate for overtime is set at time and a half of the regular pay rate.

If workers earn varying pay rates or any regular bonuses/commissions, the average pay rate must be calculated by adding totals together and dividing out by total hours worked to arrive at that total.

Salaried non-exempt workers will have a regular rate of pay determined by dividing the salary by the intended regular hours worked. Salaried workers who are non-exempt and either work irregular hours or a standard over 40 have different overtime thresholds.

For those working over 40 as a standard, hours over 40 are paid at half time up to the standard working total and time, and a half is paid for hours over that standard.

For those working irregular hours, employers are to divide the salary by total hours and then pay half time for any work over 40 hours.

Child Labor Laws in Texas

Texas considers those under age 18 to be minors for the purposes of employment law, and state law applies to all businesses in the state — not just those subject to FLSA rules.

Minors in Texas are subject to wage and hour restrictions. In general, the minimum age to work in Texas is 14, except for some agriculture and entertainment occupations and where the parent is the employer of the minor in a non-hazardous occupation.

Other exemptions to the age 14 restriction include children in safe, casual employment, newspaper delivery by those 11 or older, those at least 16 selling newspapers to the public, minors in an approved school-supervised and administered work-study program, those in court-ordered rehabilitation programs, and minors not required to attend school or who are working in agriculture.

Anyone under 18 is banned from jobs deemed hazardous, and further restrictions on types of jobs apply to those aged 14 through 15 and those aged 16 through 17.

Likewise, limits on when minors can work and how long are broken down as those aged 14 and 15 and those aged 16 and up categories. Minors aged 16 and up have no restrictions on when they can work, but those aged 14 and 15 can not work when it would interfere with school hours. However, nothing in the child labor laws exempts minors from local truancy or curfew laws.

Minors are subject to alternative minimum wage rates in some cases. For the first 90 days of employment, employers may pay minors a $4.25 per hour sub-minimum wage. Also, in the case of apprentices, qualified student employees, and those working under a DOL special license, employers may be permitted to pay minors 85% of the minimum wage rate.

Employer Recordkeeping Requirements

Texas defers to federal recordkeeping requirements for most situations.

These federal laws include but are not limited to:

  • The Fair Labor Standards Act (FLSA)
  • The Family Medical Leave Act (FMLA)
  • The Americans with Disabilities Act (ADA)

In addition, Texas state discrimination laws require employers to keep all personnel records for each employee for at least one year following separation from employment.

Due to the large number of varying recordkeeping timelines, Texas recommends that employers keep all records for at least seven years after any employee leaves the company. An exception is hazardous material exposure records, which are required to be kept for 30 years after the employee leaves employment.

Recent Texas Labor Law Updates

Repealed Sec. 21.054. ADMISSION OR PARTICIPATION IN TRAINING PROGRAM, and Sec. 21.101. AGE DISCRIMINATION LIMITED TO INDIVIDUALS OF CERTAIN AGE, and Sec. 21.054. ADMISSION OR PARTICIPATION IN TRAINING PROGRAM - Minor - September 2019

Amended to clarify age discrimination only applies to those age 40 or older.

Sec. 21.0595. DISCRIMINATORY LEAVE POLICY AFFECTING EMPLOYEE'S ENTITLEMENT TO PERSONAL LEAVE TO CARE FOR SICK FOSTER CHILD, and Sec. 21.0595. DISCRIMINATORY LEAVE POLICY AFFECTING EMPLOYEE'S ENTITLEMENT TO PERSONAL LEAVE TO CARE FOR SICK FOSTER CHILD - Minor - September 2019

Amended to address whether the foster child lives with the employee or is in state care.

Sec. 61.016. FORM OF PAYMENT - Minor - September 2019

Amended to allow payroll card accounts.

Sec. 61.051. FILING WAGE CLAIM - Minor - September 2017

Amended to allow electronic claim filing.

Sec. 61.063. PAYMENT TO COMMISSION; ESCROW PENDING REVIEW - Minor - May 2019

Amended to remove a waiver of review.

CHAPTER 92. TEMPORARY COMMON WORKER EMPLOYERS - Minor - September 2017

Amended to adjust licensing requirements for temporary workers, employer definitions, industries, and enforcement

Ombudsman Program Notice - Mandatory - April 2018

Changes to notifications, logo, and contact information

Child Labor Law Notice - Mandatory - May 2017

Hazardous job list changes and adjustments to child actor definition

Texas Labor Law Frequently Asked Questions

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