HB 736 by Rep. Phil King
Please be advised that our Texas legislation was filed by Representative Phil King (R- Weatherford) -- HB 736. Senator Kelly Hancock (R- Fort Worth) with file the senate bill. Here is a link to the bill: HB 736 The final language which will clarify landmen as independent contractors and clarify that landmen are not subject to sales tax. Should we get bogged down with the sales tax language, we may need to let it go. However, at this time, we have the support of the Texas Comptroller's Office and are hopeful we will be able to keep it. I have pasted some additional points below explaining why we are seeking the change.
HB 736 by Rep. Phil King
Currently, the Texas Labor Code defines what constitutes a landman, acting as an independent contractor, for purposes of determining unemployment benefits. To be classified as an independent contractor, the landman must be an individual who is 1) engaged in landman services; 2) is paid for the performance based on completion of specific contracted for tasks and not based on hours worked; and 3) paid pursuant to a written contract.
It is the provision in item #2 listed above relating to the “completion” of the tasks that has generated some ambiguity in the interpretation of the landman independence standing and has resulted in at least two Texas Workforce Commission cases challenging the independent contractor status of landmen in specific instances.
HB 736 clarifies that the work performed under a written contract does not constitute “employment” if the individual 1) is working as an independent contractor; and 2) the employer does not determine the means and methods of the work being performed; and 3) the landman’s compensation of the contracted services is directly related to the performance of the services.
HB 736 also, for consistency purposes, amends the definitional provisions in the Tax Code. The amendments made in this bill are a clarification of existing law.