House Bill No. 1488 seeks to improve employment practices regarding the legal status of employees in Texas by mandating participation in the federal E-Verify program for contractors and subcontractors involved in state contracts. The bill establishes penalties for non-compliance, including barring contractors from state contracts and imposing a $5,000 administrative penalty on employers who violate these regulations. It also creates a Legal Hiring Compliance Division within the Texas Workforce Commission to oversee compliance and investigate violations. Additionally, the bill emphasizes that employers cannot misclassify employees as independent contractors to avoid E-Verify requirements and mandates that political subdivisions also register for the program.

The bill includes amendments to existing legal language, such as renaming Chapter 2264 to "Certain Restrictions on Public Subsidies and State Contracts" and adding new sections that define terms related to the E-Verify program. It ensures that contracts of employment signed before the effective date of the Act will continue to be governed by the previous law, protecting existing agreements. The bill will take effect immediately if it receives a two-thirds vote from both houses; otherwise, it will become effective on September 1, 2025.

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