State Guide
Capital: Austin
PEO Services
& HR Compliance
in Texas
KeyHR provides full-service PEO solutions to Texas businesses — payroll, HR compliance, workers' compensation, and employee benefits. No state income tax, right-to-work, massive energy sector.
Texas At a Glance
Quick Answer
What HR compliance requirements do businesses in Texas need to follow?
Businesses in Texas must comply with both federal and state employment law. Key federal requirements include the Fair Labor Standards Act (FLSA) for minimum wage and overtime, the Family and Medical Leave Act (FMLA) for eligible employers, ADA accommodations, and OSHA workplace safety standards. At the state level, Texas employers must meet Texas follows federal FMLA; no additional state family leave law. Texas is one of the few states where workers' comp is not mandatory.. The current minimum wage in Texas is $7.25/hr. Key HR monitors all Texas employment law changes and automatically updates client HR policies, payroll, and compliance documentation — eliminating the risk of costly violations for businesses that lack a dedicated in-house HR team.
Texas HR & Employment Law Overview
Texas Minimum Wage & Pay Requirements
The current minimum wage in Texas is $7.25 per hour. KeyHR ensures your payroll is always compliant with Texas's wage and hour laws, including overtime rules, final pay requirements, and pay stub regulations.
Texas Workers' Compensation
Texas requires most employers to carry workers' compensation insurance. KeyHR manages your workers' comp coverage, claims advocacy, and safety programs — often reducing your true cost of risk by 20–35%.
Texas HR Compliance & Employment Law
Texas employment law governs hiring, termination, anti-discrimination, leave, and workplace safety. KeyHR monitors Texas-specific regulations and keeps your HR policies updated so you stay compliant.
Texas Payroll Tax & Reporting
Texas employers must comply with state payroll tax withholding, unemployment insurance (SUI), and new hire reporting requirements. KeyHR handles all Texas payroll tax filings accurately and on time.
Texas-Specific Employment Laws
Notable Texas Law
Texas follows federal FMLA; no additional state family leave law. Texas is one of the few states where workers' comp is not mandatory.
Paid Leave Requirements
No state-mandated paid leave (Austin, Dallas, San Antonio have local ordinances — preempted by state law)
Benefits Environment
Texas has no state income tax and minimal employment mandates, making it one of the most employer-friendly states. However, Texas's massive and diverse economy — spanning oil and gas, technology, healthcare, construction, and agriculture — means employers must offer competitive benefits to attract talent. Texas is also one of the few states where workers' compensation is not mandatory, making PEO co-employment particularly valuable for risk management.
Texas Health Insurance & ACA Compliance
Texas has the highest rate of uninsured residents in the nation — over 18% of the population. Employers who offer comprehensive health insurance gain an enormous competitive advantage in recruiting. A PEO gives Texas small businesses access to large-group Blue Cross Blue Shield of Texas rates that make comprehensive coverage affordable. With major tech employers in Austin and Houston's energy sector, the competition for talent is fierce.
ACA threshold: 50+ FTEs must offer ACA-compliant coverage. KeyHR monitors your headcount and ensures you meet all ACA reporting requirements — including 1095-C filing — before deadlines.
Texas Insurance Market
Blue Cross Blue Shield of Texas, UnitedHealthcare, Cigna, and Aetna all active.
What KeyHR Handles
in Texas
Why KeyHR in Texas
National PEO. Local Expertise.
KeyHR has been serving businesses across all 50 states since 2002. Our compliance team monitors Texas employment law changes in real time — so you're never caught off guard by a new regulation.
Texas PEO & HR Compliance FAQ
Does my Texas business need a PEO?
A PEO is not required, but it gives Texas businesses access to Fortune 500-level HR, benefits, and workers' compensation at a fraction of the cost of building those capabilities in-house. Most KeyHR clients in Texas find the PEO pays for itself through workers' comp savings and reduced HR overhead alone.
What employment laws are specific to Texas?
Texas follows federal FMLA; no additional state family leave law. Texas is one of the few states where workers' comp is not mandatory.
Does Texas require paid leave?
No state-mandated paid leave (Austin, Dallas, San Antonio have local ordinances — preempted by state law). KeyHR tracks all leave accruals and ensures your Texas business stays compliant with current state and federal leave requirements.
How does a PEO handle Texas payroll taxes?
KeyHR handles all Texas state payroll tax withholding, unemployment insurance (SUI) filings, new hire reporting, and year-end W-2 preparation. As the employer of record, KeyHR assumes the administrative and compliance burden for all Texas payroll obligations.
Is KeyHR licensed to operate as a PEO in Texas?
Yes. KeyHR is ESAC accredited and NAPEO certified, and operates in compliance with all applicable state PEO licensing requirements. KeyHR is also a member of FAPEO and has been serving businesses across all 50 states since 2002.
Related KeyHR Services for Texas Businesses
PEO Services in Nearby States
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