Untitled Texas Attorney General Opinion ( 2005 )

ATTORNEY GENERAL OF TEXAS
GREG ABBOTT
January lo,2005
The Honorable Robert Duncan Opinion No. GA-0292
Chair, Committee on State Affairs
Texas State Senate Re: Whether section 1305.003(14) of the Texas
Post Office Box 12068 Occupations Code exempts from state licensing
Austin, Texas 7871 l-2068 requirements all persons performing electrical work
for a private industrial business, even if a person
is not an employee of the private industrial business
(RQ-0233-GA)
Dear Senator Duncan:
You ask whether section 1305.003(14) of the Texas Occupations Code exempts from state
licensing requirements all persons performing electrical work for a private industrial business, even
if a person is not an employee of the private industrial business.’
During its Seventy-eighth Regular Session, the Texas Legislature enacted House Bill 1487,
which put electrical work’ regulation under the control of the Texas Department of Licensing and
Regulation (the “TDLR”). See Act ofMay30,2003,7Sth Leg., R.S., ch. 1062,2003 Tex. Gen. Laws
3059,3059 (enacting chapter 1305 of the Texas Occupations Code, the Texas Electrical Safety and
Licensing Act) (the “Act”). Before passage of the Act, electrical work regulation in Texas was
relegated to the state’s political subdivisions, which resulted in varied electrical work rules
throughout the state, and no regulation in some political subdivisions. See SENATECOMM.ONSTATE
AFFAIRS, BILL ANALYSIS,Tex. Comm. Substitute H.B. 1487, 78th Leg., R.S. (2003) (Digest and
Purpose). The Act creates a state license for six classes ofelectricians and two classes of contractors
and adopts statewide standards for electrical workers in Texas. Id. As of September 1, 2004, a
person may not perform electrical work unless the person holds an appropriate license issued or
recognized under the Act. See TEX. Oct. CODEANN. 5 1305.151 (Vernon 2004).
‘Letterfrom HonorableRobert Duncan, Chair, Senate Committee on State Affairs, to HonorableGreg Abbott,
Texas Attorney General (June 17,2004) (on file with Opinion Committee,also availableafhttp://mvw.oag.state.tx.us)
[hereinafkr Request Letter].
2“Electricalwork”is defmed as “anylabor OImaterial used in installing,maintaining, OIextending an electrical
wiringsystemand the appurtenances,
apparatus,or equipmentused in connection with the use of electrical energy in,
on, outside, or attached to a building, residence, stmchme, property, 01premises. The term includes service entrance
conductors as defined by the National Electric Code.” TEX. OCC. CODEANN.5 1305.002(11)(Vernon 2004).
The Honorable Robert Duncan - Page 2 (GA-0292)
With respect to your question, the Act provides certain exemptions t?om the Act’s licensing
requirements for a person performing electrical work. See id. 5 1305.003. You ask about section
1305.003(14) of the Act (the “exemption”) which exempts from the Act’s licensing requirements
a person who is employed by and performs electrical work solely for
a private industrial business, including a business that operates a
chemical plant, petrochemical plant, refinery, natural gas plant,
natural gas treating plant, pipeline, or oil and gas exploration and
production operation.
Id. 9 1305.003(14) (emphasis added).
As background, a brief sent in response to your request informs us that industrial businesses
depend on contracted labor to control costs by procuring expert electrical work that is needed only
on a periodic basis or to fill quickly and safely vacancies created by employees who leave but whose
electrical expertise is indispensable to the daily function of the business.’ In addition, many
industrial businesses routinely use contract electrical workers and have done so for many years4
You inform us that, “increasingly, [industrial businesses] outsource electrical and other specialized
work.” Request Letter, suprn note 1, at 2. You refer to the individuals and companies who provide
this outsourced electrical work as “third-party contractors.” See id.
You ask this question about third-party contractors in relation to the exemption:
Does the exemption established in Texas Occupations Code
5 1305.003(14) include all persons performing electrical work for a
private industrial business, even if a person is not an employee of the
private industrial business?
Request Letter, suprn note 1, at 1.
Your question requires us to construe the exemption. In construing a statute we are charged
with determining and giving effect to the legislature’s intent. See City ofSan Antonio v. City of
Boerne, 111 S.W.3d 22, 25 (Tex. 2003). This is accomplished by establishing the “plain and
common meaning of the statute’s words.” Zd. Generally, if a statute’s meaning is unambiguous, we
interpret the statute according to its plain meaning. See id. However, we determine legislative intent
from the entire act and not just isolated portions. See id. ; see also TEX. Gov’T CODEANN. 5 3 11.023
(Vernon 1998) (regardless ofwhether a statute is considered ambiguous, a court may consider, inter
ah, the circumstances under which the statute was enacted and the legislative history).
‘See Brief from Jerry D. Davis, Plant Manager, El Dorado Nitrogen, L.P., to Honorable Greg Abbott, Texas
Attorney General at 1 (July 12,2004) (on file with Opinion Committee).
‘See,e.g., Brief from Ron Dipprey,President, Texas Chemical Council, to Honorable Greg Abbott, Texas
Attorney General at 1-2 (on tile with Opinion Committee) (stating that the council has wed some contract workers for
as long as 15 years).
The Honorable Robert Duncan - Page 3 (GA-0292)
Returning to the exemption with these principles, we observe that reduced to its constituent
parts the exemption applies to “a person employed by . a private industrial business.” See
TEX.Oct. CODE ANN. 5 1305.003(14) (Vernon 2004). Although these terms, “person,““employed
by” and, “private industrial business” are the exemption’s essential elements, they are not defined
in the Act. See id. $5 1305.001-,303. To answer your question, then, we begin by analyzing
individually each of these terms according to the guiding principles previously articulated in order
to determine the terms’ meanings and, consequently, the exemption’s meaning.
In settling on a definition of “person” for the purposes of the exemption, we find two
competing concepts - the concept of “person” as an individual and the concept of “person” as any
legal entity. See BLACK’S LAW DICTIONARY1028 (5th ed. 1979). The Occupations Code employs
both concepts in defining “person.” See, e.g., TEX.Oct. CODEANN. $ 15 1.002( 11) (Vernon 2004)
(regulating physicians and defining “person” as an individual), id. 5 1302.002(14) (regulating air
conditioning and refrigeration contractors and defining “person” as an individual), id. 5 35 1.002(5)
(regulating optometrists and therapeutic optometrists and defining “person” as, among other things,
a partnership, corporation, or an “association of individuals”), and id. 5 1901.002(12) (regulating
water well drillers and defining “person” as any “private legal entity’).
As noted, the industry regulated by the Act relies heavily on outsourcing jobs to companies
that supply contract labor to perform electrical work. Given this common practice to use these third-
party contractors, and because the Occupations Code employs both concepts of the term “person,”
we conclude that “person” as used in the exemption is ambiguous. Moreover, because there is an
absence of consideration for this industry practice in the Act’s express purpose,’ or in its legislative
history: we cannot resolve this ambiguity with any degree of confidence by referring to such
documents.
II. “Emoloved By”
The term “employed by,” however, is not ambiguous. In the context of the exemption, the
term refers to employees of a private industrial business. See TEX. Oct. CODE ANN. 4 1305.003(14)
(Vernon 2004) (“a person who is employed by and performs electrical work solely for a private
industrial business’? (emphasis added). By definition, an independent contractor is not an employee.
See Limestone Prods. Dijtrib., Inc. Y.McNamara, 71 S.W.3d 308,312 (Tex. 2002) (distinguishing
by common-law test an employee from an independent contractor). However, the mere use of titles
such as “employee” and “contractor” do not determine a person’s status; rather in the employee-
independent contractor dichotomy the common-law test articulated in Limestone controls.
‘See SENATE
COMM.ONSTATEAFFAIRS,
BILLANALYSIS,
Tex. Comm. Substitute H.B. 1487,78th Leg., R.S.
(2003).
‘See HOUSECOMM.ONLICENSING & ADMIN.PROC.,HOUSEFCESEARCH
ORG.,BILLANALYSIS,
Tex. Comm.
Substitute H.B. 1487,78th Leg., R.S. (2003).
The Honorable Robert Duncan - Page 4 (GA-0292)
The test to determine whether a person is an employee rather than an independent contractor
is whether the employer has a right to control the progress, details, and methods of operations
of the work. See id. (citations omitted). An employer controls not merely the end sought to be
accomplished, but also the means and details ofits accomplishment. See id. (citations omitted). The
right to control is measured by considering: “(1) the independent nature of the worker’s business;
(2) the worker’s obligation to furnish the necessary tools, supplies, and materials to perform the job;
(3) the worker’s right to control the progress ofthe work except about final results; (4) the time for
which the worker is employed; and (5) the method of payment, whether by unit of time or by the
job.” Id. (citation’s omitted).
The employee-independent contractor test is resolved by referring to facts. Accordingly,
whether a person comes within the definition of “employed by” is a question of fact. Resolving
questions of fact is not appropriate to the opinion process. See Tex. Att’y Gen. Op. No. GA-0156
(2004) at 10.
III. “Private Industrial Business”
The exemption provides limited guidance for this term’s definition by listing entities that
qualify as private industrial businesses. See Tax. OCC.CODEANN. 6 1305.003(14) (Vernon 2004).
The Act exempts a person employed by “a private industrial business, including a business that
operates a chemical plant, petrochemical plant, refinery, natural gas plant, natural gas treating plant,
pipeline, or oil and gas exploration and production operation.” Id. (emphasis added). However, the
term “include” in a statute is a “term[] of enlargement and not a term of limitation or exclusive
enumeration, and use of the term[] does not create a presumption that components not expressed
are excluded.” TEX. GOV’TCODEANN. § 311.005(13) (Vernon 1998). As such, the definition of
“private industrial business” hinges on our ability to ferret out the common bond that holds the
listed entities together. See Peerless Carbon Black Co. v. Sheppard, 113 S.W.2d 996,997 (Tex. Civ.
App.-Austin 1938, writ ref d) (stating that while “include” is a word of enlargement, the items
expressly enumerated are illustrative of the additional items that may be included). Given the dearth
of information in the Act’s legislative history, we cannot determine with confidence the common
bond shared by the illustrative items that define “private industrial business,” and thus we conclude
that the term is vague.
In sum, it is conceivable that a third-party contractor, whether an individual or any other legal
entity, could be a “person.” Equally conceivable, a third-party contracting company that provides
electrical workers ,.to an industrial business could itself be a “private industrial business.”
Nevertheless, given that the Act does not acknowledge ubiquitous industry practices, which renders
the terms “person” and “private industrial business” ambiguous and vague, and because the
determination of whether a person is an employee or an independent contractor is a fact question,
we cannot answer your question as a matter of law.
TheHonorableRobert Duncan - Page 5 (GA-0292)
SUMMARY
Occupations Code chapter 1305, the Texas Electrical Safety
and Licensing Act, regulates electrical work in Texas. Section
1305.003(14) of the Occupations Code exempts from the Act’s
licensing requirements “a person” who is “employed by” a “private
industrial business.” The terms “person” and “private industrial
business” are ambiguous and vague. The term “employed by” refers
to a person who is an employee, but whether a person is an employee
is a fact question that cannot be answered in the opinion process.
Consequently, section 1305.003( 14)‘s terms do not provide sufftcient
clarity to answer as a matter of law the question of whether a person
performing electrical work for a private industrial business, even if a
personisnot anemployeeoftheprivateindusttial business, is exempt
from the Act’s licensing requirements.
BARRY R. MCBEE
First Assistant Attorney General
DON R. WILLETT
Deputy Attorney General for Legal Counsel
NANCY S. FULLER
Chair, Opinion Committee
Daniel C. Bradford
Assistant Attorney General, Opinion Committee