Texas House Bill No. 762, passed during the 89th Legislature. It addresses severance pay for employees and independent contractors of political subdivisions, excluding public or teaching hospitals. The bill amends Chapter 180 of the Local Government Code by adding Section 180.011, which sets clear rules on severance agreements. It defines “misconduct” as any act or omission in performing duties, including criminal conduct, as determined by the governing body. It also defines “severance pay” as any payment beyond regular earnings at termination. The legislation caps severance pay at no more than 20 weeks of salary, excluding accrued vacation or paid time off, and prohibits severance entirely if termination is due to misconduct. To increase transparency, political subdivisions must prominently post all severance agreements on their official websites.
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