The following sections discuss the general procedures of the Rule 13 hearing process.

To request a Rule 13 tax hearing, an Authorized Representative should send a written request to the local TWC tax office. A Responsible Party signature is sufficient provided FTC is documented that the Authorized Representative is aware of the action. The local tax office will forward the request to the State Office.

• When an employer requests a Rule 13 coverage hearing, the Accounts Examiner and Hearing Coordinator(HC) must do everything in his/her power to resolve the dispute informally but tactfully.
  
• Disputed amounts are taxes and interest due on amounts paid to persons deemed to be in employment by the Commission but not previously reported by the appellant.
  
• If the dispute cannot be resolved, obtain a letter from the employer requesting a Rule 13 coverage hearing.
  
• The proper reports and/or adjustments must be on file, prior to acceptance of a request for a hearing.

1. Conduct a thorough investigation and gather all information available by telephone, letter or personal visit.
   
   
2. Complete and file all quarterly and/or correction reports and status reports needed.
   
   
3. Complete the appropriate Independent Contractor Questionnaire.
   
   
4. Make a printout showing all delinquency and status records.
   
   
5. Review similar cases on the computer.
   
   
6. Meet with your Rule 13 Coverage Hearing Coordinator (HC) for further preparation.

• Place a "stop" on the account, and enter appropriate documentation on the account.
  
  
• Review the case with the Accounts Examiner and determine if the facts warrant a hearing.
  
  
• Identify all Interested Parties.
  
  Black's Law Dictionary defines interested parties for purposes of an administrative hearing, as those who have a legally recognized private interest, and not simply a possible pecuniary (monetary) benefit.
  
  
• If the worker was involved with a third party employer, both companies must be "Interested Parties" and identified as brought into the hearing process. For example: Company "A" hires worker "X" and assigns worker "X" to company "B" office location. Company "B" should be identified as an "Interested Party."
  
  
• If the workers are found not to be in employment, the Hearing Coordinator will notify the employer, examine the file to see if more status information or adjustment reports are needed, and issue the appropriate assignment.
  
  
• If the workers are in employment, the HC will attempt to resolve the case with the employer without a hearing. If unsuccessful, the HC will write a letter to the employer; acknowledge the request for a hearing; and cite the issues involved.
  
  
• If the hearing is due to a liability question, or any question relating to contributions or reimbursements, the Hearing Coordinator will discuss the issues and try to resolve those issues with the interested parties. Example: Company A (Styled as a staff leasing company) has been established as the employer. The claimant indicated no wages are listed under Company A. After an investigation it is determined that Company A is not a licensed staff leasing company. Company B is the actual employer. In this situation if a hearing is requested, insure that the claimant, and both Company A and Company B are listed as the employers. The HC will contact all parties and try to sort out and resolve all of the issues. If the parties are not satisfied, the HC will complete the Rule 13 Coverage Hearing Worksheet, listing the issues and all interested parties, using additional sheets as needed.
  
  
• The HC will advise the interested parties that the request for hearing is being sent to State Office Status Section.
  
  
• The Rule 13 Hearings Issue Worksheet, must be completed and attached to the state office transmittal. Insure that all interested parties are named. Include the office FAX number and if witnesses are required, include the names, addresses and reasons for the testimony in the Issues Worksheet.
  
  
• The HC should assess whether a translator is needed at this point. If so, highlight this information on the Rule 13 Hearings Issue Worksheet.
  
  
• Establish a "tickler" file to insure that the request for a hearing is not lost in the mail.
  
  
• When the hearing date is set by the Special Hearings Department and the HC receives a copy, an assignment will be made for the Accounts Examiner and the HC.
  
  
• If the hearing is postponed or canceled, the assignment will be cleared from the assignment inventory.
  
  
• The HC will review the case with the Accounts Examiner and plan their presentation. If any additional witnesses are needed, the Special Hearings Attorney should be notified immediately.
  
  
• Hearing coordinators are expected to evaluate the facts of each appeal and determine if any Commission witnesses are essential to the Rule 13 presentation and whether they will be needed throughout the hearing. If a Commission witness is needed to provide essential testimony, the Hearing Coordinator can verbally submit a request and supporting arguments to the Hearing Officer during the opening phase of the Rule 13 proceedings.
  
  For example, the complex issue of tax rate computation may require that a Tax Department representative hear and evaluate all of the facts of the case in order to make a proper and accurate response. Therefore, the Tax Department representative is "a party.... essential to the presentation of the (Tax Department's) .... cause." The Hearing Coordinator should, when offered the opportunity at the opening, give a statement like "The Tax Department requests that (representative named) be allowed to be present and hear the employer testimony because full understanding of all the issues is essential to the presentation of the Commission's cause."

Occasionally an attorney maybe necessary to assist Tax in a Rule 13 Hearing, if so, the Tax Department will request assistance from the Legal Department.

• The Tax Department and the employer are equal parties. The Special Hearings Attorney although a TWC employee must remain impartial during the hearing and will extract as much information as can be obtained from both parties.
  
  
• The Accounts Examiner who made the investigation should be the one present even though he or she may no longer work the area.
  
  
• The Accounts Examiner should be ready to testify as to:

The hearing coordinator (HC) will represent the tax department in the hearing by protecting the interest of the accounts examiner. The hearing coordinator will :

1. Make an opening statement

2. Cross-examine the employer and employer witnesses. The purpose of the cross-examination is to impeach the employer's testimony and develop additional testimony.

3. Directly examine the accounts examiner and Tax Department witnesses.

4. Make a closing statement.

• The Hearing Coordinator will place a stop on the account.
  
  
• The Hearing Coordinator will call the interested parties to advise the employer of the Rule 13 hearing process.
  
  
• The Accounts Examiner will be issued a status assignment to investigate the issues and, if appropriate, complete the necessary questionnaire or documents.
  
  
• The Accounts Examiner will complete the assignment (i.e. complete all the investigation obtain all the reports needed in thirty days).
  
  
• The Hearing Coordinator will complete the Rule 13 Hearing Issues Worksheet. Insure that all interested parties are named. Include the office FAX number and if witnesses are required, include the names, addresses and reasons for the testimony in the Issues Worksheet.
  
  
• The Accounts Examiner and Hearing Coordinator will attend the hearing in an advisory capacity and be ready to answer questions from the Special Hearings Attorney and be cross-examined by the interested parties.
  
  
• An assignment will be issued to the appropriate Accounts Examiner, when the hearing is scheduled.

If the interested parties and the Tax Department agree to a settlement and the interested parties wish to withdraw the hearing request, the interested parties or the Tax Department must mail or fax the written withdrawal request to the Special Hearings Department.

Note: The Commission's written decision may affirm, reverse or modify the Tax Department's decision. The Commission's written decision is mailed promptly to the interested parties and the Tax Department. Once the Commission reaches a decision, the Tax Department is asked to adjust the interested parties tax account(s), if necessary, in accordance with that decision.

• Special Hearings Department staff attorneys conduct informal fact-finding hearings on tax liability questions under the authority of Texas Workforce Commission Rule 13 (40 TAC 815.13). The Special Hearings Attorney will explain the law and the hearing procedures before the hearing begins, and will then give each side a chance to ask questions. Following this hearing, the Commission will review the testimony and documents presented at the hearing. A written decision based on the weight of the evidence will be issued pursuant to the Texas Unemployment Compensation Act.
  
  
• Telephone Hearing: This hearing will be conducted by telephone. Select a quiet location to call from.
  
  
• Telephone Call-In Instructions:The date and time for the hearing is shown on the Notice of Hearing. On the scheduled day and time, place a call to the Special Hearings Department at the telephone number given on the Notice of Hearing. Please call promptly at the time scheduled.
  
  Give your telephone number. When you call, tell the clerk the telephone number that you are calling from. The Special Hearings Attorney will call you back at that telephone number to establish a telephone conference call. The Special Hearings Attorney will then ask for the telephone numbers where your witnesses and representative, if any, can be reached.
  
  Set Aside Enough Time For The Hearing.
  
  
• Representative: The Special Hearings Attorney will help parties develop the facts in the case so a representative is not required. However, you may have an attorney or another person represent you, at your own expense.
  
  
• Witnesses: At the hearing, you may present witnesses to provide relevant information to support your position. Choose witnesses with direct, firsthand information about the issue or issues in the case. When appropriate, the Special Hearings Attorney may limit unnecessary testimony or may exclude witnesses whose testimony is needlessly repetitive. Arrange to have your witnesses available throughout the hearing.
  
  
• Documents: Your choice of documents to present depends, in part, on the issues in your case. Plan to present a copy of every document supporting your position.
  
  Send copies to the Special Hearings Attorney: You must promptly mail or fax a copy of every document you want to present in the hearing to the Special Hearings Attorney in plenty of time to allow the attorney the opportunity to review the documents before the hearing. Send the documents by mail or fax as explained below.
  
  Mail or Fax Instructions:
  
  Letters or documents may be faxed to the Special Hearings Department.
  
  Important:  Letters or documents, whether sent by mail or faxed, must include the employer's TWC tax account number.
  
  Send a copy to all the interested parties: Promptly mail or deliver the same documents you send to the Special Hearings Attorney to all the interested parties at that party's address as shown on the notice of hearing.
  
  Keep one copy of each document for yourself, and have it with you during the hearing.
  
  

• Be on time and wait in a public waiting area. The special hearings attorney (SHA) will call parties from the waiting area and escort them to the hearing room.
  
  
• Once in the hearing room, the tape recorder will be turned on by the SHA and the SHA will introduce him/herself.
  
  
• The SHA informs all parties that the hearing is being tape recorded, he/she has been selected to conduct the hearing and develop the record, and the Commission will issue the written decision.
  
  
• The SHA will identify all parties present by name and position, explain the appellant's contentions and summarize the issues, and explain the hearing procedures.
  
  
• The Tax Department and all interested parties provides opening statements.
  
  
• The SHA will question the interested parties about the issues.
  
  
• After questioning, the interested parties or their representatives are allowed to add information and documents not yet covered.
  
  
• The interested parties or their representatives are allowed to ask questions of the employer.
  
  
• The Hearing Coordinator is allowed to cross-examine the employer.
  
  
• The above procedures will be followed for each employer witness.
  
  
• The SHA will question the Accounts Examiner and allows the Accounts Examiner to present factors supporting the Tax Department's position.
  
  
• The hearing coordinator (HC) will be allowed to ask questions of the Accounts Examiner.
  
  
• The employer representative will cross-examine the Accounts Examiner.
  
  
• After all testimony has been offered, both sides will have the opportunity to offer a rebuttal to any issues.
  
  
• All sides then give closing statements.
  
  
• The SHA gives a brief post-hearing explanation and concludes the hearing.
  
  
• The tape recorder is shut off.