Can a Texas county deduct money from a worker's paycheck for using tobacco?

Plain-English summary

The Presidio County Commissioners Court was considering a wellness incentive plan under which county employees who use tobacco and decline a smoking-cessation program would have a monthly amount taken out of their paychecks. The County Attorney asked the AG whether the county had authority to do that. The briefs described the plan in two different ways: the request letter framed the deduction as a penalty placed in a separate account the county could spend any way it wanted, while the Texas Association of Counties described it as an adjustment to the employee's insurance premium that would go into the group health benefits fund. That difference mattered, so the AG addressed the county's general authority rather than one specific version of the plan.

A county commissioners court has only the powers the constitution and statutes confer, plus the implied authority needed to carry out those powers. The AG walked through the payroll-deduction and insurance statutes. The Local Government Code lets a county make payroll deductions at an employee's request for listed purposes, including a public-purpose payment, and for insurance premiums, but those provisions are built on the employee's request or written consent. The Code and the Insurance Code also let a county provide group health insurance, contribute to or charge for premiums, and deduct the employee's share with written approval, including through a risk pool. Nowhere did the AG find express authority to dock a salary without consent solely because the employee uses tobacco.

So the AG drew a line. A consentless deduction imposed just for tobacco use is not expressly authorized. But the county's insurance authority is broad. Insurance Code article 3.51 lets a county insure classes of employees, and a commissioners court has discretion to set reasonable terms of coverage. To the extent the wellness plan is part of the county's health insurance, and the larger deduction reflects that tobacco users are a class with a higher premium, the AG concluded the deduction is likely within the county's express authority to offer insurance and to deduct the increased premium from the employee's pay with consent. The AG limited the opinion to state-law authority and did not address whether a particular plan complies with federal wellness-program laws like GINA, the ADA, and HIPAA as amended by the ACA.

Currency note

This opinion was issued in 2018. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

What the opinion meant for those who asked

The Presidio County Attorney and the commissioners court (who requested the opinion): The opinion told them the county could not impose a consentless paycheck deduction on the sole basis of tobacco use, but that structuring the charge as part of group health insurance, where tobacco users form a higher-premium class and the deduction is taken with consent, likely fell within the county's express insurance authority. It noted the two conflicting descriptions of the plan and answered at the level of general authority.

County employees who use tobacco (as the opinion described them): The opinion treated the relevant deduction statutes as requiring the employee's request or written consent. It explained that a higher insurance-premium deduction tied to membership in a tobacco-user class is different from a standalone penalty deducted without consent.

Other counties weighing wellness plans (as the opinion described the framework): The opinion laid out the statutes a county relies on, the payroll-deduction provisions and the group-health-insurance provisions, and flagged that it did not address compliance with federal wellness-program laws, which a county would still need to satisfy.

Common questions

Can a Texas county take money from my paycheck just because I use tobacco?
The AG concluded no, not without consent and not on that basis alone. No Local Government Code provision expressly authorizes a county to deduct from an employee's salary without consent solely because the employee uses tobacco products.

So how can a tobacco surcharge be lawful?
Through the county's insurance authority. A county may provide group health insurance and charge a higher premium to a class of employees, such as tobacco users, and may deduct the employee's share of that premium from the paycheck with written consent.

Does the employee have to agree to the deduction?
The deduction statutes the AG cited are built on the employee's request or written approval. The AG described the lawful path as an increased premium deduction taken with consent, not a unilateral penalty.

Did the AG say the plan was legal under all laws?
No. The AG limited the opinion to county authority under state statutes and expressly did not address whether a particular wellness plan complies with federal laws such as GINA, the ADA, and the HIPAA nondiscrimination provisions as amended by the Affordable Care Act.

Background and statutory framework

A county commissioners court exercises only the powers the constitution or statutes confer (Tex. Const. art. V, § 18; Canales v. Laughlin, 214 S.W.2d 451, 453 (Tex. 1948)), with implied authority to exercise broad discretion to accomplish the purposes intended (Anderson v. Wood, 152 S.W.2d 1084, 1085 (Tex. 1941)). The Local Government Code authorizes payroll deductions on the employee's request for listed purposes, including a public-purpose payment for an unlisted item (Tex. Loc. Gov't Code § 155.001(a), (a)(5); see also §§ 155.002, 155.003), and for insurance premiums on the employee's request (§ 155.061; see also §§ 155.062, 155.063).

The county's insurance authority comes from several sources. Section 157.101 authorizes group health and related benefits, and section 157.102 lets the commissioners court require participants to contribute. Insurance Code article 3.51, section 1(a) authorizes a county to insure its employees or classes of them under group health policies, with premiums payable in whole or in part by employer or employees. Chapter 172 authorizes political subdivisions, directly or through a risk pool, to provide health and accident coverage (§§ 172.004, 172.005(a)), and section 172.013(c) authorizes deducting an employee's contribution from compensation on written approval. The AG found no express authority to deduct without consent solely for tobacco use, but concluded that a commissioners court has discretion to set reasonable terms of coverage (citing prior AG opinions), so a higher premium deduction for a tobacco-user class, taken with consent, likely falls within the county's express insurance authority. The opinion did not address compliance with federal wellness-program laws (42 U.S.C. §§ 2000ff-2000ff-11; 42 U.S.C. §§ 12101-12117; 42 U.S.C. § 18001; 28 Tex. Admin. Code §§ 21.4701-.4708).

Citations

Cases:

• Canales v. Laughlin, 214 S.W.2d 451, 453 (Tex. 1948)
• Anderson v. Wood, 152 S.W.2d 1084, 1085 (Tex. 1941)

Prior AG opinions:

• Tex. Att'y Gen. Op. No. JC-0369 (2001)
• Tex. Att'y Gen. Op. No. JC-0414 (2001)
• Tex. Att'y Gen. LO-90-80 (1990)

Statutes:

• Tex. Const. art. V, § 18
• Tex. Loc. Gov't Code §§ 155.001(a), (a)(5), 155.002, 155.003, 155.061, 155.062, 155.063, 157.101, 157.102, 172.004, 172.005(a), 172.013(c)
• Tex. Ins. Code art. 3.51, § 1(a)
• 42 U.S.C. §§ 2000ff-2000ff-11, 12101-12117, 18001; 28 Tex. Admin. Code §§ 21.4701-.4708

Source

• Landing page: https://www.texasattorneygeneral.gov/opinions/ken-paxton/kp-0187
• Original PDF: https://www.texasattorneygeneral.gov/sites/default/files/opinion-files/opinion/2018/kp0187.pdf

Original opinion text

Best-effort transcription from the official PDF. Minor extraction artifacts were corrected; the linked PDF is authoritative.

KEN PAXTON
ATTORNEY GENERAL OF TEXAS

March 21, 2018

The Honorable Rod Ponton Opinion No. KP-0187
Presidio County Attorney
Post Office Drawer M Re: Authority of a county commissioners court
Marfa, Texas 79843 to implement a health wellness plan that
includes a monthly payroll deduction for county
employees who use tobacco products
(RQ-0182-KP)

Dear Mr. Ponton:

    You tell us the Presidio County Commissioners Court is considering approving a wellness incentive plan for Presidio County ("County") employees, and you ask about its authority to "implement a health wellness plan that penalizes county employees who use tobacco products through a monthly deduction off of their paycheck." [1] You describe a plan in which county tobacco-using employees who decline to enter a smoking cessation program would have a monthly paycheck deduction that you aver will be placed into a separate account to be spent in "any way that the County desires." Request Letter at 2. The Texas Association of Counties submitted briefing to this office indicating the wellness program is offered through the Texas Association of Counties Health and Employee Benefits Pool. [2] The Association Brief also states that the deduction is merely an adjustment to the employee's insurance premium and that the "contributions from county employees would presumably be placed in the group health and related benefits fund by the county and limited in use to paying for group health and related benefits." Association Brief at 3, 5. The differing descriptions of the plan raise uncertainty about the exact nature of the deduction at issue. Nonetheless, we consider the specific provisions of the Local Government Code to determine a county's general authority in this context. See Request Letter at 1-2.

     A county commissioners court can exercise only such powers as the constitution or the statutes specifically confer. See TEX. CONST. art. V, § 18; Canales v. Laughlin, 214 S.W.2d 451, 453 (Tex. 1948). Yet, "[w]here a right is conferred or obligation imposed on a [commissioners] court, it has implied authority to exercise a broad discretion to accomplish the purposes intended." Anderson v. Wood, 152 S.W.2d 1084, 1085 (Tex. 1941); Tex. Att'y Gen. Op. No. JC-0369 (2001) at 1. Relevant to your question and specific to payroll deductions, the Local Government Code authorizes a county to, "on the request of a county employee," authorize a payroll deduction for a number of specified purposes. TEX. LOC. GOV'T CODE § 155.001(a); see also id. §§ 155.002 (providing requirements for employee's request for deduction), 155.003 (providing for payment of administrative costs of making a deduction). One such purpose is the "payment relating to an item not listed ... if the commissioners court determines that the payment serves a public purpose." Id. § 155.001(a)(5); see also Tex. Att'y Gen. LO-90-80 (1990) at 2 (stating with respect to predecessor statute that "any such deductions may be made only with the ... employee's written consent"). Additionally, section 155.061 authorizes a payroll deduction for premiums for various types of insurance policies "on the request of a county ... employee." TEX. LOC. GOV'T CODE § 155.061; see also id. §§ 155.062 (providing requirements for employee's request for deduction), 155.063 (providing for the administration of the deduction).

    Section 157.101 authorizes a county to provide for group health and related benefits. See id. § 157.101; see also id. § 157.102 (authorizing a commissioners court to require persons participating in a group health plan offered by the county "to contribute toward the payment of the plan"). Article 3.51 of the Insurance Code also authorizes a county as a political subdivision to insure its employees "or any class or classes thereof under a policy or policies of group health." TEX. INS. CODE art. 3.51 § 1(a). "The premium for the policy ... may be paid in whole or in part from funds contributed by the employer or in whole or in part from funds contributed by the insured employees." Id. You do not raise chapter 172 of the Local Government Code, but it authorizes political subdivisions, directly or through a risk pool, to provide health and accident coverage for officials, employees, retirees, and their dependents. TEX. LOC. GOV'T CODE §§ 172.004, .005(a); see Association Brief at 1 (describing the creation of the Health and Employee Benefits Pool by "political subdivisions entering into a charter interlocal agreement"). Subsection 172.013(c) authorizes a political subdivision, on written approval of the employee, to deduct from an employee's compensation an amount necessary to pay that person's contribution for coverage. TEX. LOC. GOV'T CODE § 172.013(c). Nowhere in these provisions do we find express authority for a county to deduct an amount from an employee's salary without the employee's consent on the sole basis that the employee is a user of tobacco products.

   Yet, these provisions plainly authorize a county to provide different types of insurance, including health insurance, to its employees and to deduct an employee's portion of the premium from the employee's paycheck with written consent. Moreover, Insurance Code article 3.51 authorizes the county to provide insurance coverage to different classes of employees. See TEX. INS. CODE art. 3.51; see also Tex. Att'y Gen. Op. No. JC-0414 (2001) at 2 ("The commissioners court has discretion under [section 157.001 and article 3.51] to establish reasonable terms and conditions of health insurance coverage for county officers and employees, subject to judicial review for abuse of discretion."). Thus, to the extent the health wellness plan is a part of the county's provision of health insurance and the increased deduction from an employee's salary is because the employee, as a tobacco user, is in a class of employees for which the insurance premium is higher, the deduction is likely within the county's express authority to offer insurance and to deduct the increased premium, with consent, from the employee's salary. [3]

                                  SUMMARY

                  No provision in the Local Government Code expressly authorizes a county to deduct an amount from an employee's salary without the employee's consent on the sole basis that the employee is a user of tobacco products. Yet, pursuant to its authority to provide health insurance to its employees under sections 157.101 and 172.013(c) of the Local Government Code and article 3.51 of the Insurance Code, a county is likely authorized to offer, in connection with its insurance coverage, a health wellness plan with an increased deduction from an employee's salary where the employee, as a tobacco user, is in a class for which the insurance premium is higher.

                                        Very truly yours,

                                        KEN PAXTON
                                        Attorney General of Texas

JEFFREY C. MATEER
First Assistant Attorney General

BRANTLEY STARR
Deputy First Assistant Attorney General

VIRGINIA K. HOELSCHER
Chair, Opinion Committee

CHARLOTTE M. HARPER
Assistant Attorney General, Opinion Committee

[1] Letter from Honorable Rod Ponton, Presidio Cty. Att'y, to Honorable Ken Paxton, Tex. Att'y Gen. at 1 (Sept. 20, 2017), https://texasattorneygeneral.gov/opinion/requests-for-opinion-rqs ("Request Letter"). A brief submitted in connection with your request states "that the program was not approved for implementation at the current time." Brief from Sheriff Danny C. Dominguez at 1 (Sept. 29, 2017) (on file with the Op. Comm.).

[2] See Brief from Stan Reid, Gen. Counsel, Tex. Ass'n of Counties at 1 (Nov. 6, 2017) ("Association Brief") (on file with the Op. Comm.).

[3] This opinion is limited to an examination of a county's authority under state statutes and does not address whether any particular wellness plan conforms to state and federal laws governing wellness programs, including Title II of the Genetic Information Nondiscrimination Act of 2008, Title II of the Americans with Disabilities Act, and the HIPAA nondiscrimination provisions, as amended by the Affordable Care Act. See generally Genetic Information Nondiscrimination Act, 81 Fed. Reg. 31143 (May 17, 2016) (to be codified at 29 C.F.R. 1635) (discussing various federal laws governing wellness programs offered by employers); see also 42 U.S.C. §§ 2000ff-2000ff-11, 42 U.S.C. §§ 12101-12117, 42 U.S.C. § 18001; 28 TEX. ADMIN. CODE §§ 21.4701-.4708 (Tex. Dep't of Ins., Wellness Programs).