AB 716

Under current law, a professional employer organization (PEO) or professional

employer group (PEG) must apply for and obtain registration with the Department

of Regulation and Licensing (department) prior to providing professional employer

services in this state. This bill makes a number of changes to the law governing PEOs

and PEGs.

Change to definition of PEO

Current law defines a PEO to mean a person engaged in the business of

entering into written contracts for the provision of the nontemporary, ongoing

employee workforce of a client and that under the contract has the obligation to pay

the employees providing services for the client. A PEG is defined to mean two or more

PEOs controlled by the same person. Current law defines a temporary help agency

as an employer who places its employee with or leases its employees to another

employer who controls the employee's work activities and compensates the first

employer for the employee's services, regardless of the duration of the services.

Current law defines a temporary help company as an entity that contracts with a

client to supply individuals to perform services for the client on a temporary basis

to support or supplement the workforce of the client in situations such as personnel

absences, temporary personnel shortages, and workload changes resulting from

seasonal demands or special assignments or projects, and that hires and terminates

the employment of, sets the rate of pay of, and pays the individuals.

This bill modifies the definition of PEO to explicitly exclude from the definition

both a temporary help agency and a temporary help company.

PEO and PEG small operations registration

Currently, a PEO or PEG that has no more than 50 employees performing

services for clients in Wisconsin and that is registered or licensed in another state,

domiciled in another state, and does not maintain an office in Wisconsin or directly

solicit clients that are located or domiciled in Wisconsin may apply for limited

registration. This bill changes the name of such registration from limited to small

operations.

Currently, an application for PEO or PEG registration or the renewal of

registration must be accompanied by a financial statement that sets forth the

financial condition of the applicant. This bill exempts a PEO or PEG seeking small

operations registration or the renewal of small operations registration from the

requirement to provide a financial statement to the department.

Treatment of tax credits and economic development incentives for providing

employment and payment of taxes, assessments, expenditures, and

benefits of employees

Current law provides that, in the event a client of a PEO or PEG is entitled to

obtain tax credits or other economic development incentives from the state as a result

of that client providing employment, the employees of a PEO or PEG who are