CS/HB 239

1	A bill to be entitled
2	An act relating to employee leasing companies; amending s.
3	468.525, F.S.; requiring that each employee leasing
4	company at all times maintain a workers' compensation
5	policy; requiring that each contractual arrangement
6	between an employee leasing company and a client company
7	where the client company is to furnish workers'
8	compensation provide to the employee leasing company
9	evidence of valid workers' compensation coverage;
10	requiring that certain specified conditions be included in
11	the contractual arrangement between an employee leasing
12	company and its client companies; amending s. 468.529,
13	F.S.; requiring an employee leasing company to notify its
14	employees if the employee leasing company terminates its
15	agreement with a client company; providing the dates the
16	cancellation of workers' compensation coverage is
17	effective; requiring an employee leasing company or its
18	client companies to secure workers' compensation coverage
19	from an insurance company authorized in this state;
20	providing that an employee leasing company and its client
21	companies are considered an "employer" for the purposes of
22	the workers' compensation law; reenacting s. 626.112(1),
23	F.S., relating to the licensing of insurance agents,
24	insurance adjusters, and customer representatives to
25	incorporate the amendment to s. 468.525, F.S., in a
26	reference thereto; amending s. 443.036, F.S.; revising the
27	definition of the term "employee leasing company" to
28	reflect new reporting requirements; amending s. 443.1216,
29	F.S.; requiring the provision of quarterly reports that
30	include certain information regarding client and employee
31	leasing company establishments; providing effective dates.
32
33	Be It Enacted by the Legislature of the State of Florida:
34
35	Section 1.  Paragraphs (h) and (i) are added to subsection
36	(3) of section 468.525, Florida Statutes, paragraph (f) of
37	subsection (4) of that section is amended, and paragraph (g) is
38	added to subsection (4) of that section, to read:
39	468.525  License requirements.--
40	(3)  Each employee leasing company licensed by the
41	department shall have a registered agent for service of process
42	in this state and at least one licensed controlling person. In
43	addition, each licensed employee leasing company shall comply
44	with the following requirements:
45	(h)  Each employee leasing company shall, regardless of the
46	number of leased employees, at all times maintain a workers'
47	compensation policy acceptable under the laws of this state.
48	(i)  An employee leasing company whose contract with a
49	client company provides for the client company to furnish
50	coverage under this part shall require the client company to
51	provide evidence of valid workers' compensation coverage to the
52	employee leasing company.
53	(4)  The employee leasing company's contractual
54	arrangements with its client companies shall satisfy the
55	following conditions, whereby the leasing company:
56	(f)  Gives has given written notice of the relationship
57	between the employee leasing company and the client company to
58	each leased employee it assigns to perform services at the
59	client's worksite and gives written notice to all leased
60	employees as to whether the employee leasing company or the
61	client company is providing their workers' compensation
62	coverage.
63	(g)  Sets forth whether each leased employee will be
64	covered by a workers' compensation policy issued to the employee
65	leasing company or to the client company.
66	Section 2.  Section 468.529, Florida Statutes, is amended
67	to read:
68	468.529  Licensee's insurance; employment tax; benefit
69	plans.--
70	(1)  A licensed employee leasing company is the employer of
71	the leased employees, except that this provision is not intended
72	to affect the determination of any issue arising under Pub. L.
73	No. 93-406, the Employee Retirement Income Security Act, as
74	amended from time to time. An employee leasing company is shall
75	be responsible for timely payment of unemployment taxes pursuant
76	to chapter 443, and is shall be responsible for providing
77	workers' compensation coverage pursuant to this part and chapter
78	440. However, no licensed employee leasing company shall sponsor
79	a plan of self-insurance for health benefits, except as may be
80	permitted by the provisions of the Florida Insurance Code or, if
81	applicable, by Pub. L. No. 93-406, the Employee Retirement
82	Income Security Act, as amended from time to time. For purposes
83	of this section, a "plan of self-insurance" shall exclude any
84	arrangement where an admitted insurance carrier has issued a
85	policy of insurance primarily responsible for the obligations of
86	the health plan.
87	(2)  An initial or renewal license may not be issued to any
88	employee leasing company unless the employee leasing company
89	first files with the board evidence of workers' compensation
90	coverage for all leased employees in this state. Each employee
91	leasing company shall maintain and make available to its
92	workers' compensation carrier the following information:
93	(a)  The correct name and federal identification number of
94	each client company.
95	(b)  A listing of all covered employees provided to each
96	client company, by classification code.
97	(c)  The total eligible wages by classification code and
98	the premiums due to the carrier for the employees provided to
99	each client company.
100	(3)  A licensed employee leasing company shall, within 30
101	days after initiation or termination of an employee leasing
102	agreement, notify its workers' compensation insurance carrier,
103	the Division of Workers' Compensation of the Department of
104	Financial Services, and the state agency providing unemployment
105	tax collection services under contract with the Agency for
106	Workforce Innovation through an interagency agreement pursuant
107	to s. 443.1316 of both the initiation or the termination of the
108	company's relationship with any client company.
109	(4)(a)  If an employee leasing company terminates its
110	relationship with a client company, the employee leasing company
111	must send notice of the termination by United States Postal
112	Service first class mail to the last known address of each
113	leased employee who had been assigned to the terminated client
114	company. The notification must state the date the employee
115	leasing company terminated its relationship with the client
116	company.
117	(b)  A leased employee who continues in the employment of a
118	terminated client company is not covered by the workers'
119	compensation policy of the employee leasing company after the
120	employee leasing company terminates its relationship with the
121	client company. Termination of the employee's workers'
122	compensation coverage is effective at the earliest of:
123	1.  Five days after the employee leasing company mails a
124	notice of termination by United States Postal Service first
125	class mail to the last known address of the leased employee;
126	2.  Upon the leased employee receiving actual or
127	constructive notice that he or she is no longer an employee of
128	the employee leasing company; or
129	3.  Receipt, with proof of delivery, by the leased
130	employee, or receipt, with proof of delivery, at the leased
131	employee's last known address, of notice that the individual is
132	no longer an employee of the employee leasing company.
133	(c)  If an employee leasing company continues its
134	relationship with a client company but terminates the employment
135	of, places on a leave of absence, or lays off a leased employee
136	who is assigned to the client company, the leased employee is
137	not covered by the workers' compensation policy of the employee
138	leasing company at the earliest of:
139	1.  Five days after the employee leasing company mails a
140	notice, by United States Postal Service first class mail to the
141	last known address of the leased employee, informing the leased
142	employee that he or she is no longer a leased employee of the
143	employee leasing company, is on a leave of absence from the
144	client company or employee leasing company, or has been laid off
145	from the client company or employee leasing company; or
146	2.  Upon the leased employee receiving actual or
147	constructive notice that he or she is no longer an employee of
148	the client company or employee leasing company, is on a leave of
149	absence from the client company or employee leasing company, or
150	has been laid off from the client company or employee leasing
151	company.
152	(d)  Notwithstanding any actual or constructive notice
153	received by the leased employee that he or she is no longer a
154	leased employee of the employee leasing company and is no longer
155	covered by the employee leasing company's workers' compensation
156	policy, the requirements for notice to a leased employee under
157	paragraph (a), paragraph (b), or paragraph (c) are deemed to be
158	satisfied if a leased employee:
159	1.  Negotiates a paycheck marked "final paycheck" which
160	clearly states or contains written notice that the leased
161	employee is no longer an employee of the employee leasing
162	company and is not covered by its workers' compensation policy;
163	2.  Receives payment in cash, by paycheck, or by direct
164	deposit which contains no reference indicating that the payment
165	is from the employee leasing company; or
166	3.  Is provided written notice by the client company or the
167	employee leasing company stating that the leased employee is no
168	longer an employee of the employee leasing company and is not
169	covered by the employee leasing company's workers' compensation
170	policy.
171	(5)  An employee leasing agreement shall state whether the
172	responsibility to obtain workers' compensation insurance
173	coverage for leased employees as required under chapter 440
174	shall be allocated to the employee leasing company, the client
175	company, or both. The responsibility to obtain workers'
176	compensation coverage for leased employees shall be by way of a
177	master policy issued in the name of the employee leasing
178	company, a multiple coordinated policy issued to the employee
179	leasing company, a policy issued to the client company, or any
180	other policy acceptable under the laws of this state.
181	(6)  Within 15 days of the termination of an employee
182	leasing agreement, the employee leasing company shall provide
183	the client company an opportunity to receive records regarding
184	the loss experience of the workers' compensation insurance
185	during the course of the employee leasing agreement.
186	(7)  The client company and the employee leasing company
187	shall be considered the employer of leased employees for
188	purposes of coverage under chapter 440 regardless of whether the
189	client or employee leasing company is supplying workers'
190	compensation coverage. Subject to any limitations set forth in
191	chapter 440 or s. 627.192(7), s. 440.11(2) shall apply to the
192	employee leasing company and the client company and to all other
193	persons set forth in s. 440.11(2) if workers' compensation
194	coverage is secured for leased employees by the client company
195	or the employee leasing company.
196	(8)(4)  An initial or renewal license may not be issued to
197	any employee leasing company unless the employee leasing company
198	first provides evidence to the board, as required by board rule,
199	that the employee leasing company has paid all of the employee
200	leasing company's obligations for payroll, payroll-related
201	taxes, workers' compensation insurance, and employee benefits.
202	All disputed amounts must be disclosed in the application.
203	(9)(5)  The provisions of this section are subject to
204	verification by department or board audit.
205	Section 3.  For the purpose of incorporating the amendment
206	made by this act to section 468.525, Florida Statutes, in a
207	reference thereto, subsection (1) of section 626.112, Florida
208	Statutes, is reenacted to read:
209	626.112  License and appointment required; agents, customer
210	representatives, adjusters, insurance agencies, service
211	representatives, managing general agents.--
212	(1)(a)  No person may be, act as, or advertise or hold
213	himself or herself out to be an insurance agent, insurance
214	adjuster, or customer representative unless he or she is
215	currently licensed by the department and appointed by an
216	appropriate appointing entity or person.
217	(b)  Except as provided in subsection (6) or in applicable
218	department rules, and in addition to other conduct described in
219	this chapter with respect to particular types of agents, a
220	license as an insurance agent, service representative, customer
221	representative, or limited customer representative is required
222	in order to engage in the solicitation of insurance. For
223	purposes of this requirement, as applicable to any of the
224	license types described in this section, the solicitation of
225	insurance is the attempt to persuade any person to purchase an
226	insurance product by:
227	1.  Describing the benefits or terms of insurance coverage,
228	including premiums or rates of return;
229	2.  Distributing an invitation to contract to prospective
230	purchasers;
231	3.  Making general or specific recommendations as to
232	insurance products;
233	4.  Completing orders or applications for insurance
234	products;
235	5.  Comparing insurance products, advising as to insurance
236	matters, or interpreting policies or coverages; or
237	6.  Offering or attempting to negotiate on behalf of
238	another person a viatical settlement contract as defined in s.
239	626.9911.
240
241	However, an employee leasing company licensed pursuant to
242	chapter 468 which is seeking to enter into a contract with an
243	employer that identifies products and services offered to
244	employees may deliver proposals for the purchase of employee
245	leasing services to prospective clients of the employee leasing
246	company setting forth the terms and conditions of doing
247	business; classify employees as permitted by s. 468.529; collect
248	information from prospective clients and other sources as
249	necessary to perform due diligence on the prospective client and
250	to prepare a proposal for services; provide and receive
251	enrollment forms, plans, and other documents; and discuss or
252	explain in general terms the conditions, limitations, options,
253	or exclusions of insurance benefit plans available to the client
254	or employees of the employee leasing company were the client to
255	contract with the employee leasing company. Any advertising
256	materials or other documents describing specific insurance
257	coverages must identify and be from a licensed insurer or its
258	licensed agent or a licensed and appointed agent employed by the
259	employee leasing company. The employee leasing company may not
260	advise or inform the prospective business client or individual
261	employees of specific coverage provisions, exclusions, or
262	limitations of particular plans. As to clients for which the
263	employee leasing company is providing services pursuant to s.
264	468.525(4), the employee leasing company may engage in
265	activities permitted by ss. 626.7315, 626.7845, and 626.8305,
266	subject to the restrictions specified in those sections. If a
267	prospective client requests more specific information concerning
268	the insurance provided by the employee leasing company, the
269	employee leasing company must refer the prospective business
270	client to the insurer or its licensed agent or to a licensed and
271	appointed agent employed by the employee leasing company.
272	Section 4.  Effective October 1, 2008, subsection (18) of
273	section 443.036, Florida Statutes, is amended to read:
274	443.036  Definitions.--As used in this chapter, the term:
275	(18)  "Employee leasing company" means an employing unit
276	that has a valid and active license under chapter 468 and that
277	maintains the records required by s. 443.171(5) and, in
278	addition, produces quarterly reports as specified in s. 443.1216
279	on the clients of the employee leasing company maintains a
280	listing of the clients of the employee leasing company and of
281	the employees, including their social security numbers, who have
282	been assigned to work at each client company job site. Further,
283	each client company job site must be identified by industry,
284	products or services, and address. The client list must be
285	provided to the tax collection service provider by June 30 and
286	by December 31 of each year. As used in this subsection, the
287	term "client" means a party who has contracted with an employee
288	leasing company to provide a worker, or workers, to perform
289	services for the client. Leased employees include employees
290	subsequently placed on the payroll of the employee leasing
291	company on behalf of the client. An employee leasing company
292	must notify the tax collection service provider within 30 days
293	after the initiation or termination of the company's
294	relationship with any client company under chapter 468.
295	Section 5.  Effective October 1, 2008, paragraph (a) of
296	subsection (1) of section 443.1216, Florida Statutes, is amended
297	to read:
298	443.1216  Employment.--Employment, as defined in s.
299	443.036, is subject to this chapter under the following
300	conditions:
301	(1)(a)  The employment subject to this chapter includes a
302	service performed, including a service performed in interstate
303	commerce, by:
304	1.  An officer of a corporation.
305	2.  An individual who, under the usual common-law rules
306	applicable in determining the employer-employee relationship, is
307	an employee. However, whenever a client, as defined in s.
308	443.036(18), which would otherwise be designated as an employing
309	unit has contracted with an employee leasing company to supply
310	it with workers, those workers are considered employees of the
311	employee leasing company. An employee leasing company may lease
312	corporate officers of the client to the client and other workers
313	to the client, except as prohibited by regulations of the
314	Internal Revenue Service. Employees of an employee leasing
315	company must be reported under the employee leasing company's
316	tax identification number and contribution rate for work
317	performed for the employee leasing company.
318	a.  In addition to any other report required to be filed by
319	law, an employee leasing company shall submit a report to the
320	Agency for Workforce Innovation, Labor Market Statistics Center,
321	or as otherwise directed by the agency, which must include the
322	following information for each client establishment and each
323	establishment:
324	(I)  The trade or establishment name.
325	(II)  The former unemployment compensation account number,
326	if available.
327	(III)  The former Federal Employment Identification Number,
328	if available.
329	(IV)  The industry code recognized and published by the
330	United States Office of Management and Budget, if available.
331	(V)  A description of the client's primary business
332	activity in order to verify or assign an industry code.
333	(VI)  The physical location address.
334	(VII)  The number of full-time and part-time employees who
335	worked during or received pay that was subject to unemployment
336	compensation taxes for the pay period, including the 12th day of
337	the month for each month of the quarter.
338	(VIII)  The total wages subject to unemployment
339	compensation taxes paid during the calendar quarter.
340	(IX)  An internal identification code to uniquely identify
341	each establishment of each client.
342	(X)  The month and year the client entered into contract.
343	(XI)  The month and year the client terminated the contract
344	for services.
345	b.  The report shall be submitted electronically or in a
346	manner otherwise prescribed by the Agency for Workforce
347	Innovation in the format specified by the United States
348	Department of Labor, Bureau of Labor Statistics, for its
349	Multiple Worksite Report for Professional Employer
350	Organizations. The report must be provided quarterly to the
351	Agency for Workforce Innovation, Labor Market Statistics Center,
352	or as otherwise directed by the agency, and must be filed by the
353	last day of the month immediately following the end of the
354	calendar quarter. The information required in sub-sub-
355	subparagraphs a.(X) and (XI) must be provided only in the
356	quarter in which the contract to which it relates was entered
357	into or terminated. The sum of the employment data and the sum
358	of the wage data on this report must match the employment and
359	wages reported on the unemployment compensation quarterly tax
360	and wage report.
361	c.  The Agency for Workforce Innovation shall have
362	rulemaking authority as necessary to implement the provisions of
363	this subparagraph and shall have the authority to administer,
364	collect, enforce, and waive the penalty imposed by s.
365	443.141(1)(b) for the report required by this subparagraph.
366	d.  For the purposes of this subparagraph, the term
367	"establishment" means any location at which business is
368	conducted or at which services or industrial operations are
369	performed.
370	3.  An individual other than an individual who is an
371	employee under subparagraph 1. or subparagraph 2., who performs
372	services for remuneration for any person:
373	a.  As an agent-driver or commission-driver engaged in
374	distributing meat products, vegetable products, fruit products,
375	bakery products, beverages other than milk, or laundry or
376	drycleaning services for his or her principal.
377	b.  As a traveling or city salesperson engaged on a full-
378	time basis in the solicitation on behalf of, and the
379	transmission to, his or her principal of orders from
380	wholesalers, retailers, contractors, or operators of hotels,
381	restaurants, or other similar establishments for merchandise for
382	resale or supplies for use in their business operations. This
383	sub-subparagraph does not apply to an agent-driver or a
384	commission-driver and does not apply to sideline sales
385	activities performed on behalf of a person other than the
386	salesperson's principal.
387	4.  The services described in subparagraph 3. are
388	employment subject to this chapter only if:
389	a.  The contract of service contemplates that substantially
390	all of the services are to be performed personally by the
391	individual;
392	b.  The individual does not have a substantial investment
393	in facilities used in connection with the services, other than
394	facilities used for transportation; and
395	c.  The services are not in the nature of a single
396	transaction that is not part of a continuing relationship with
397	the person for whom the services are performed.
398	Section 6.  Except as otherwise specifically provided in
399	this act, this act shall take effect July 1, 2008.

CODING: Words stricken are deletions; words underlined are additions.