HB 5368

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1.  Section 62.051, Labor Code, is amended to read as
Sec. 62.051.  MINIMUM WAGE.  (a)  Except as otherwise
provided by this section [Section 62.057], an employer shall pay to
each employee not less than $19 an hour.
(b)  Notwithstanding Subsection (a), and except as provided
by Subsection (c), an employer shall pay to each employee not less
(1)  the minimum wage established under Subsection (a);
(2)  the amount set as the federal minimum wage under
Section 6, Fair Labor Standards Act of 1938 (29 U.S.C. Section 206).
(c)  Beginning on October 1, 2026, an employer shall pay to
an employee not less than the minimum wage established under
(d)  Except as provided by Subsection (e), on June 1, 2026,
and every year thereafter, the commission shall adjust the minimum
wage established under Subsection (b) for inflation.  The adjusted
minimum wage rate shall be computed to the nearest cent using the
consumer price index for all urban consumers (CPI-U), as computed
by the United States Department of Labor for the preceding 12
months, or an analogous index adopted by the commission by rule.
(1)  describe the process used in computing inflation
rates and the procedure for determining the level of inflation used
in the commission's computations; and
(2)  based on the computations under Subdivision (1),
set the state minimum wage for the subsequent calendar year.
(e)  The commission may not adjust the minimum wage under
Subsection (d) to an amount that is less than the minimum wage for
(f)  This section does not apply to compensation paid to a
person under Section 62.057 or to a tipped employee under Section
SECTION 2.  Section 62.052, Labor Code, is amended to read as
Sec. 62.052.  TIPPED EMPLOYEES.  (a)  [In determining the
wage of a tipped employee, the amount paid the employee by the
employer is the amount described as paid to a tipped employee under
Section 3(m), Fair Labor Standards Act of 1938 (29 U.S.C. Section
[(b)]  In this section, "tipped employee" means an employee
engaged in an occupation in which the employee customarily and
regularly receives more than $20 a month in tips.
(b)  An employer shall pay to each tipped employee the
federal minimum wage under Section 6, Fair Labor Standards Act of
1938 (29 U.S.C. Section 206(a)(1)).  The amount paid to an employee
may not be reduced by a tip credit against the minimum wage.
(c)  This section may not be construed to allow an employer
to keep any portion of a tipped employee's tips.
SECTION 3.  Section 497.004(a), Government Code, is amended
(a)  The board shall [may] develop by rule and the department
shall [may] administer an incentive pay scale for work program
participants consistent with rules adopted by the board under
Subchapter C.  The board shall set pay levels at a minimum of the
federal minimum wage under Section 6, Fair Labor Standards Act of
1938 (29 U.S.C. Section 206(a)(1)).  Prison industries may be
financed through contributions donated for this purpose by private
businesses contracting with the department.  The department shall
apportion pay earned by a work program participant in the same
manner as is required by rules adopted by the board under Section
SECTION 4.  Section 497.099(b), Government Code, is amended
(b)  The board shall [may] develop by rule and the department
shall [may] administer an incentive pay scale program for inmates
required to work in agricultural, industrial, or other work
programs.  In developing the program, the board shall set pay levels
not to unjustly reward inmates, but rather to instruct inmates on
the virtues of diligent participation in the workplace, provided
that the board shall set pay levels at a minimum of the federal
minimum wage under Section 6, Fair Labor Standards Act of 1938 (29
U.S.C. Section 206(a)(1)).  The department shall deposit an amount
earned by an inmate under this subsection into the inmate's trust
fund and may deduct not more than 80 percent of the amount deposited
under this subsection for payment of restitution and dependent care
owed by the inmate.  [This subsection does not apply to the
compensation of an inmate participating in a Texas Correctional
Industries program under Subchapter A or an inmate participating in
a private sector prison industries program under Subchapter C.]
SECTION 5.  Section 62.151, Labor Code, is repealed.
SECTION 6.  Not later than December 1, 2025, the Texas Board
of Criminal Justice shall adopt the rules required by Sections
497.004(a) and 497.099(b), Government Code, as amended by this Act.
SECTION 7.  This Act takes effect September 1, 2025.