The bill mandates that state contractors, political subdivisions, and private employers in Texas must participate in the federal E-Verify program to verify employment authorization for their employees. It amends Chapter 2264 of the Government Code, changing its heading to reflect "Certain Restrictions on Public Subsidies and State Contracts." The bill introduces new sections that outline the requirements for contractors to register and participate in the E-Verify program, including a stipulation that contracts with state agencies must include a certification statement regarding the contractor's eligibility. Additionally, it establishes procedures for barring contractors from state contracts if they fail to comply with E-Verify requirements.

Furthermore, the bill adds new chapters to the Labor Code and Local Government Code, requiring employers and political subdivisions to verify employee information through E-Verify. It specifies that employers cannot misclassify employees as independent contractors to evade these requirements. The bill also includes provisions for enforcement by state agencies, which may require compliance as a condition for issuing licenses or permits. The effective date for the implementation of these requirements is set for September 1, 2025, with certain provisions applying starting January 1, 2027.

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