Texas HB 2127 "Death Star" Bill

Background screening is a vital process for employers, landlords, and other entities that need to verify the identity, credentials, and history of potential candidates. However, background screening is not a one-size-fits-all practice. Different jurisdictions may have different laws and regulations that govern what information can be collected, how it can be used, and how long it can be retained. For example, some cities and counties in Texas have enacted local ordinances that ban the use of criminal history or credit history in hiring or housing decisions, or that require employers to provide paid sick leave or fair chance hiring policies.

 But a new law passed by the Texas Legislature and signed by Governor Abbott could change all that. House Bill 2127, also known as the Texas Regulatory Consistency Act or the “Death Star” bill, is a sweeping preemption law that aims to override any local ordinance that conflicts with state law in nine broad areas of the Texas Constitution.

In this blog post, we will explore how the Texas Death Star bill could affect background screening in the Lone Star State. We will examine some of the local ordinances that could be invalidated by the law, and how they might impact different aspects of background screening. We will also discuss some of the potential implications and risks for background screening providers and users in light of the law’s uncertainty and litigation.

What is Texas House Bill 2127?

House Bill 2127 intends to create a uniform and predictable regulatory environment for businesses and consumers across the state by preventing cities and counties from enforcing or enacting any legislation that governs labor practices in a manner exceeding or conflicting with state regulations.

The law covers nine broad areas of the Texas Constitution that relate to agriculture, business and commerce, finance, insurance, labor, local government, natural resources, occupations, and property. The law also allows any person or entity affected by a local ordinance to sue the city or county for damages and attorney fees.

The law might not intend to prohibit an employer from allowing rest, shade, and water to prevent heat-related illness, and it does not necessarily violate or conflict with OSHA. However, the law does effectively nullify some laws from local ordinances related to employment. For example, the law invalidates Austin’s Fair Chance Hiring Ordinance, also known as Austin’s “Ban the Box” law, which restricted private employers from inquiring about job applicants’ criminal histories until a conditional job offer was extended. The law also invalidates a similar ordinance that was passed in DeSoto, Texas in 2021. These ordinances can no longer be enforced by the city.

Some Cities are Fighting Back Against the Texas Death Star Bill

The Texas Death Star bill has faced strong opposition from several cities that have sued the state for violating their constitutional authority. Houston, along with more than a dozen other cities, is arguing that the bill is unconstitutional. They claim that the bill infringes on the Texas Home-Rule Charter, which grants cities with at least 5,000 residents the power to pass any ordinance that does not conflict with state law. They also contend that the bill is vague, overbroad, and retroactive, and that it interferes with local democracy and home rule. Consequently, the law’s future remains uncertain, but it has gone into effect nonetheless pending an appeal by the Texas Attorney General's Office.

What Employers Need to Know About the Texas Death Star Bill

The Texas Death Star bill has significant implications for employers who conduct background screening in the state of Texas, as well as for those who hire remote applicants who reside in Texas. Moreover, this bill could become a model for other states interested in pursuing similar preemption goals. Employers may want to monitor the situation and consult with their legal team to review their current job postings and hiring policies accordingly.

The bill is currently in effect as of October 2023, despite the legal challenges and opposition from several cities. If the bill remains in place without any changes, all local laws that conflict with or expand beyond the state law regarding employment will be invalidated. Verified Credentials is committed to providing our clients with updates on the status of these changes and helping them stay compliant and informed in this evolving legal landscape.