(a) This section applies only to building and construction projects as provided by the Texas Labor Code, §406.142.
(b) An independent contractor and a hiring contractor, as defined in the Texas Labor Code, §406.141, may enter into a written agreement:
(1) to allow the hiring contractor to withhold the cost of workers’ compensation insurance from the contract price; and
(2) to stipulate that, for the sole purpose of providing workers’ compensation insurance, the hiring contractor will be the employer of the independent contractor and the independent contractor’s employees.
(c) An agreement made under subsection (b) of this section shall be filed in the form and manner prescribed by the division.
(d) The agreement shall:
(1) be in writing;
(2) indicate whether the hiring contractor will make a deduction for the premiums;
(3) specify that the hiring contractor will be the employer of the independent contractor and the independent contractor’s employees for the sole purpose of providing workers’ compensation insurance;
(4) specify the location of the job sites subject to the contract and the agreement;
(5) contain the signatures of both parties; and
(6) indicate the date the agreement was made, the term the agreement will be effective, and the estimated number of employees affected by the agreement.
(e) The workers’ compensation insurance coverage provided by the hiring contractor under the agreement shall take effect no sooner than the date on which the agreement was executed and deductions for the premiums shall not be made for coverage provided prior to that date.
(f) If a person who is covered by an independent contractor agreement signed under this section is found to be an employee of the hiring contractor, the person:
(1) is covered under the hiring contractor’s workers’ compensation policy; and
(2) shall receive a refund from the hiring contractor for all amounts improperly deducted as premium.
(g) The hiring contractor must maintain the original and file a legible copy of the agreement with the hiring contractor’s workers’ compensation insurance carrier within 10 days of the date of execution. An agreement is not considered filed if it is illegible or incomplete.
(h) A hiring contractor electing to provide workers’ compensation insurance coverage through an agreement under subsection (b) of this section shall be deemed to have accepted the rights and responsibilities of an employer imposed under the Act as of the effective date of the workers’ compensation insurance coverage.
(i) If an independent contractor makes an agreement under this rule, the employee of the independent contractor may elect to retain his common law rights as provided by the Texas Labor Code, §406.034.
(j) For purposes of the Texas Labor Code, §406.142, 20,000 square feet is measured on the outside perimeter of the structure.
The provisions of this §112.201 adopted to be effective February 26, 1991, 16 TexReg 896; amended to be effective March 13, 2000, 25 TexReg 2082; amended to be effective April 15, 2018, 43 TexReg 2151.