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Article of Interest

Breathe a Little Easier, Employer – Liability Limitations on Hiring Persons with Criminal Convictions Went Into Effect June 14, 2013
By: John W. Shaw, Whitaker Chalk Swindle & Schwartz PLLC

On my way into the office the Tuesday morning after taking Labor Day off, I heard on the local news that more than 650 new laws went into effect on September 1st. While I have not taken the time to research whether that number is accurate, the very mention of anywhere near that many new laws going into effect heightens my desire to attend a legislative update CLE in the near future (if only incrementally, because let’s face it, that is going to be a long CLE). This desire is compounded by the fact that although there were that many new laws that went into effect on September 1, there were many other laws that went into effect immediately upon passage this 83rd legislative session.

I am sure that employers and the lawyers who represent them are excited about one such law that went into effect immediately earlier this summer. On June 14, 2013, Governor Perry signed into law H.B. 1188, entitled “AN ACT relating to limiting the liability of persons who employ persons with criminal convictions.” This legislation amended Section 1, Title 6 of the Civil Practices and Remedies Code by adding Chapter 142.

As of June 14, 2013, “a cause of action may not be brought against an employer, general contractor, premises owner, or other third party solely for negligently hiring or failing to adequately supervise an employee, based on evidence that the employee has been convicted of an offense.” TEX. CIV. PRAC. REM CODE § 142.002(a) (emphasis added). As is often the case, however, what the legislature gives, they also limit. Section 142.002 does not “preclude a cause of action for negligent hiring or the failure of an employer, general contractor, premises owner, or other third party to provide adequate supervision of an employee if: (1) they knew or should have known of the conviction; and (2) the employee was convicted of: (A) an offense that was committed while performing duties substantially similar to those reasonably expected to be performed in the employment, or under conditions substantially similar to those reasonably expected to be encountered in the employment, taking into consideration the factors listed in Section 53.022 (outlining the factors in determining whether conviction relates to occupation) and 53.023(a) (outlining the factors in determining the fitness to perform the duties and discharge the responsibilities of the licensed occupation of a person who has been convicted of a crime), Occupations Code, without regard to whether the occupation requires a license; (B) an offense listed in Section 3g, Article 42.12 (e.g. Murder, Capital murder, Indecency with a child etc.), Code of Criminal Procedure; or (C) a sexually violent offense, as defined by Article 62.001 (definition of sexually violent offenses), Code of Criminal Procedure.” TEX. CIV. PRAC. REM CODE § 142.002(b).

Additionally, the protections provided to an employer, general contractor, premises owner or third party under section 142.002 “do not apply in a suit concerning the misuse of funds or property of a person other than the employer, general contractor, premises owner, or third party by an employee if, on the date the employee was hired (1) the employee had been convicted of a crime that includes fraud or the misuse of funds or property as an element of the offense, and (2) it was foreseeable that the position for which the employee was hired would involve discharging a fiduciary responsibility in the management of funds or property.” TEX. CIV. PRAC. REM CODE § 142.002(c) (numbers not in original). Finally, section 142.002 does not create a cause of action or expand an existing cause of action. TEX. CIV. PRAC. REM CODE § 142.002(d). 

While section 142.002 will provide some relief to employers by ultimately requiring plaintiffs in a negligent hiring or negligent supervision case to provide more evidence than a just a criminal conviction, there are some instances where just a criminal conviction alone will still be sufficient to bring a lawsuit. Employers need to be aware of the circumstances under which they are still susceptible to liability and adjust their policies to account for this exposure. They may, however, breathe a little easier that they are not as open to liability as they were prior to June 14, 2013.
  
- John W. Shaw is an Attorney at Whitaker Chalk Swindle & Schwartz PLLC, a full service civil and business law firm in Fort Worth, Texas where he currently focuses on civil, business, intellectual property and employment litigation.