Bill > H4563

This bill establishes a regulatory framework for Professional Employer Organizations (PEOs) operating in Massachusetts, defining key terms like "client" (a business that contracts with a PEO), "covered employee" (an individual employed through a PEO agreement), and "PEO relationship" (a co-employment arrangement where employer responsibilities are shared between the PEO and the client). PEOs must register with the Department of Labor Standards, providing detailed information about their business, ownership, and financial condition, and will be subject to ongoing reporting and financial requirements, including maintaining positive working capital or providing a bond. The bill clarifies that while PEOs handle payroll and benefits administration, clients retain the primary right of direction and control over their employees and business operations, and specific responsibilities for taxes, wages, and benefits are outlined. It also addresses how PEO employees are treated for purposes of tax credits, economic incentives, and employee count for various laws, generally deeming them employees of the client for these purposes. The bill also includes provisions for enforcement, disciplinary actions for violations, and requires PEOs to provide notice to covered employees about the co-employment relationship and relevant contact information.