BILL NUMBER: AB 975	INTRODUCED
	BILL TEXT


INTRODUCED BY   Assembly Member Ma

                        FEBRUARY 18, 2011

   An act to add Section 612 to the Unemployment Insurance Code,
relating to employment.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 975, as introduced, Ma. Professional employer organizations.
   Existing law requires employers to make specified payments and
withholdings from wages paid for employment to the Employment
Development Department, which also is charged with administering the
state's unemployment insurance program. Existing law also requires
employers, as defined, to register with the department, and imposes
penalties on employers for failure to register.
   This bill would prohibit a person or entity from providing,
advertising for, or otherwise holding itself out as providing,
professional employer services in the state, unless that person or
entity is registered as a professional employer organization with the
department. The bill would require the director to prescribe rules
establishing the method for professional employer organizations to
report quarterly wages and contributions to the director for worksite
employees, as specified.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 612 is added to the Unemployment Insurance
Code, to read:
   612.  (a) A person or entity shall not provide professional
employer services, advertise for professional employer services, or
otherwise hold itself out as providing professional employer services
in this state unless that person or entity is registered as a
professional employer organization with the department.
   (b) The director shall prescribe rules establishing the method for
professional employer organizations to report quarterly wages and
contributions to the director for worksite employees.
   (1) The rules shall recognize the professional employer
organization as the employing unit of its worksite employees for
reporting purposes. However, the rules may require that each worksite
employee of a single client be reported under a separate and unique
department subaccount of that client of the professional employer
organization to reflect the experience of the worksite employees for
a client.
   (2) A department subaccount shall be used solely to determine
experience rates for that individual department subaccount on an
annual basis and shall recognize a professional employer organization
as the employing unit associated with each department subaccount.
The rate and experience existing on a client's department account
prior to entering into a professional employer agreement shall be
combined with the experience accumulated as an department subaccount
of the professional employer organization and the combined experience
shall remain with the client account upon termination of the
professional employer agreement.
   (3) The rules promulgated pursuant to this division shall include
administrative requirements that permit a professional employer
organization to transmit the reporting and payments date required by
this section collectively as a single electronic filing with the
director.