ARIZONA HOUSE OF REPRESENTATIVES Fifty-sixth Legislature Second Regular Session

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HB 2252: professional employer organization; repeal

Sponsor: Representative Wilmeth, LD 2

Committee on Commerce

Overview

Repeals statutes relating to the registration of Professional Employer Organizations (PEO).

History

According to the National Association of Professional Employer Organizations, a PEO provides payroll, benefits, regulatory compliance assistance and other HR services to companies. Any person who is engaged in the business of providing professional employer services whether or not the person uses the term professional employer organization, staff leasing company, registered staff leasing company, employee leasing company or any other name is statutorily designated as a PEO. Statute requires PEOs to register with the Secretary of State (SOS). PEOs must maintain either: 1) a minimum net worth of at least $100,000; or 2) a bond, an irrevocable letter of credit or securities that have a minimum market value of $100,000.  The bond must be held by a depository designated by the SOS (Title 23, Chapter 3, Art. 4, A.R.S.).

Laws 2023, Chapter 144, extended the delayed implementation of statutes relating to Professional Employer Organization registration until June 30, 2024.

Provisions

1. Removes the requirement for a PEO to register with the SOS. (Sec. 2)

2. Changes the required bond to be held in an insured depository institution, rather than by a depository designated by the SOS. (Sec. 3)

3. Repeals statutes relating to:

a) the registration of PEOs;

b) types of PEO registrations;

c) criminal acts and penalties for PEOS and clients of PEOs;

d) SOS authority to collect registration fees, adopt rules and penalties for PEO violations; and

e) the PEO Fund. (Sec. 2, 5)

4. Makes technical changes. (Sec. 1, 3, 4)

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8.                   HB 2252

9. Initials PB           Page 0 Commerce

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