USA – TEXAS Law and Practice Contributed by: Alana Ackels and Katie Beaird, Bell Nunnally & Martin
in the agreement. The main remedy is typically the “benefit of the bargain” or what the party would have received had the breach not occurred. Additionally, in some situations, the prevailing party will be entitled to their attorney’s fees incurred. Contractual disputes can also arise when the employ - ee’s employment contract sets out how they will be paid (salary, bonuses, equity options, etc) but the compensation is not paid according to the contract provisions. Contractual disputes regarding pay also typically arise when an at-will employee has a com - mission agreement and disputes that their commis - sions have been calculated and paid correctly under the contract. 1.3 Working Hours Texas employees can work full time (typically 35–40 hours a week) or part time (typically 30 or less hours a week). An employee’s status as part-time or full-time is determined by the hours worked, not by agreement. Texas requires employers to pay overtime to a non- exempt (full-time or part-time) employee who works more than 40 hours in a single working week. How - ever, Texas does not set a maximum of total hours allowed, so potential overtime earnings can be sig - nificant. Exempt employees are generally full-time, are not entitled to overtime pay and have no limit on hours worked in a week. Although generally Texas does not have a maximum of daily hours worked for exempt or non-exempt employees, certain exceptions apply in safety-sensi - tive industries such as nursing and for truck drivers. 1.4 Compensation Both Texas and federal US law require Texas employ - ers to pay the federal minimum wage, which is cur - rently USD7.25. Texas presently sets its minimum wage based on the applicable federal rate. Thus, if the federal rate increases, the Texas minimum wage rate would also increase. Cities are permitted to require that employers pay employees who work within city limits a higher mini - mum wage. By way of example, the city of Austin,
Texas requires a USD15 minimum wage for employ - ees who work within Austin, Texas. Employees can also be paid on a salary basis, which is when an employee is paid the same amount each week regardless of hours worked. Both hourly and salary employees can earn bonuses if offered by their employers, but bonuses are not required. If a bonus plan is enacted, it is important to define when the bonus is earned, how it is calculated and how the employee’s separation from employment will affect Texas does not require employers to provide any paid leaves of absence, including maternity, disability, fam - ily, medical or sick leave. However, there are several laws requiring Texas employers to provide unpaid leave for certain reasons, including for disabilities and serious health conditions, and to care for newborn or adopted babies. Additionally, many Texas employees provide paid leaves to attract and retain employees. Providing paid time off (vacation and sick leave) for full-time employees is generally expected of Texas employers. If paid time off is provided to employees, Texas does not require an employer pay out accrued but unused paid time off at the time an employee resigns or is terminated, unless the employer has a policy stating it will – or the employee has – an agreement stating such pay is owed. Limits on Confidentiality and Non-Disparagement Clauses The US Congress also passed the Speak Out Act, which became effective on 7 December 2022. In the event of allegations of sexual assault and/or sexual harassment, any related non-disclosure and non-dis - paragement clauses entered into “before the dispute arises” are rendered unenforceable under this law. This means that, unless a dispute related to sexual harassment or sexual assault is being resolved by virtue of a settlement containing confidentiality and non-disparagement language, broad-sweeping con - fidentiality and non-disparagement language in oth - er agreements may not be enforceable. This could whether the bonus will be paid. 1.5 Other Employment Terms Paid Leave and Time Off
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