AB1056: Bill Text

AB1056,22,10 2. The professional employer organization is not considered to be engaging in any trade, occupation, profession, or other activity that is subject to the licensing, registration, or certification requirement solely because the professional employer organization has entered into and maintains a coemployment relationship with the covered employee.

AB1056,22,13 3. The client has the sole right to direct, supervise, and control the activities of the covered employee, and the business of the client, that are subject to the licensing, registration, or certification requirement.

AB1056,22,19 (d) Taxation, tax credits, and other economic development incentives. 1. Any covered employee whose services are taxable service under s. 77.52 or 77.53 is considered to be an employee of the client for purposes of liability for payment of sales or use taxes on those services. Nothing contained in this section shall release a client from any liability for payment of the full amount of sales or use taxes due on those services.

AB1056,22,22 2. The liability of a professional employer organization for any tax on professional employer services that is based on gross receipts is limited to a tax on the administrative fee charge by the professional employer organization.

AB1056,23,2 3. For purposes of any tax that is based on the payroll of an employer, a client is liable for the amount of that tax that is based on the compensation of a covered employee and a professional employer organization is liable for the amount of that tax that is based on the compensation of an employee who is not a covered employee.

AB1056,23,18 4. For purposes of determining tax credits, other economic development incentives provided by the state that are based on providing employment, or any other benefits that arises out of the employment of a covered employee, a covered employee is considered to be an employee solely of the client, and the client is entitled to the benefit of the tax credit, economic development incentive, or other benefit. If the amount of a tax credit, incentive, or benefit described in this paragraph is based on the number of employees employed by a client, only those covered employees who are coemployed by the client and the professional employer organization shall be treated as employees employed by the client, and covered employees who are coemployed by the professional employer organization and another client of the professional employer organization shall not be treated as employees employed by the client. On request of a client that is seeking a tax credit, incentive, or other benefit described in this paragraph or of an agency of this state that is responsible for administering such a tax credit, incentive, or benefit, a professional employer organization shall provide any employment information reasonably required by the agency that is necessary to support a claim, application, or other action by the client.

AB1056,23,24 (e) Contracts, grants, and loans. For purposes of contracting with, or obtaining a grant or loan from, the state or a local governmental unit, a client's status or certification as a minority business, minority financial adviser, minority investment firm, women's business, small business, native American or Indian business, veteran-owned business, or disadvantaged business is not affected because the client has entered into a professional employer agreement.

AB1056,24,6 (6) Violations; penalties. (a) Disciplinary action. The department may deny, suspend, revoke, restrict, refuse to renew, or otherwise withhold a registration; impose a period of probation under specified conditions; order a registrant to cease and desist from violating this section or a rule promulgated under sub. (8); or impose a forfeiture of not more than $1,000; if the department finds that an applicant, registrant, or controlling person has done any of the following:

AB1056,24,8 1. Conducted any of the activities specified in sub. (2) (a) without first registering with the department as provided in sub. (2).

AB1056,24,11 2. Knowingly made a material misrepresentation or false statement in an application for registration or for renewal of a registration under sub. (2) or in a report under s. 108.067.

AB1056,24,15 3. Been convicted of any crime in connection with the operation of a professional employer organization, any crime that involves fraud or deceit, or any crime that otherwise affects the ability of the applicant, registrant, or controlling person to operate a professional employer organization.

AB1056,24,17 4. Willfully committed a violation of this section or of a rule promulgated under sub. (8).

AB1056,24,21 (b) Investigations; orders. The department may investigate violations specified in par. (a) and issue orders to enforce this section. The investigations and orders shall be made as provided in s. 103.005. Orders issued under this section are subject to review as provided in ch. 227.

AB1056,25,3 (7) Child support; delinquent taxes. (a) Social security number or federal identification number required. 1. Except as provided in subd. 3., the department shall require each applicant for registration who is an individual to provide the department with the applicant's social security number, and shall require each applicant for registration who is not an individual to provide the department with the applicant's federal employer identification number, when applying for initial or renewal registration.

AB1056,25,10 2. If an applicant who is an individual fails to provide the applicant's social security number to the department or if an applicant who is not an individual fails to provide the applicant's federal employer identification number to the department, the department may not issue or renew a registration to or for the applicant unless the applicant is an individual who does not have a social security number and the applicant submits a statement made or subscribed under oath or affirmation as required under subd. 3.

AB1056,25,15 3. If an applicant who is an individual does not have a social security number, the applicant shall submit a statement made or subscribed under oath or affirmation to the department that the applicant does not have a social security number. The form of the statement shall be prescribed by the department. A registration issued in reliance upon a false statement submitted under this subdivision is invalid.

AB1056,25,21 4. The subunit of the department that obtains a social security number or a federal employer identification number under subd. 1. may not disclose the social security number or the federal employer identification number to any person except to the department of revenue for the sole purpose of requesting certifications under s. 73.0301 or on the request of the subunit of the department that administers the child and spousal support program under s. 49.22 (2m).

AB1056,26,7 (b) Child support payments. The department shall deny, suspend, restrict, refuse to renew, or otherwise withhold a registration for failure of the applicant or registrant to pay court-ordered payments of child or family support, maintenance, birth expenses, medical expenses, or other expenses related to the support of a child or former spouse or for failure of the applicant or registrant to comply, after appropriate notice, with a subpoena or warrant issued by the department or a county child support agency under s. 59.53 (5) and related to paternity or child support proceedings, as provided in a memorandum of understanding entered into under s. 49.857. Notwithstanding s. 103.005 (10), an action taken under this paragraph is subject to review only as provided in the memorandum of understanding entered into under s. 49.857 and not as provided in ch. 227.

AB1056,26,13 (c) Delinquent taxes. The department shall deny an application for the issuance or renewal of a registration, or revoke a registration already issued, if the department of revenue certifies under s. 73.0301 that the applicant or registrant is liable for delinquent taxes. Notwithstanding s. 103.005 (10), an action taken under this paragraph is subject to review only as provided under s. 73.0301 (5) and not as provided in ch. 227.

AB1056,26,15 (8) Rules. The department shall promulgate rules to implement this section. Those rules shall include rules providing for all of the following:

AB1056,26,17 (a) Alternative registration of professional employer organizations under sub. (2) (g).

AB1056,26,19 (b) Fees under sub. (2) (h) 4. and 6. for registration of professional employer groups and for other services provided under this section.

AB1056,26,21 (c) Minimum requirements for issuance or renewal of a registration under sub. (2) (i).

AB1056, s. 13 Section 13. 108.02 (21e) (a) of the statutes is amended to read:

AB1056,26,25 108.02 (21e) (a) Has the right to hire and terminate the employees who perform services for the client and to reassign the employees to other clients as provided in s. 105.117 (4) (b) 3.;

AB1056, s. 14 Section 14. 108.02 (21e) (d) of the statutes is amended to read:

AB1056,27,6 108.02 (21e) (d) Has a general right of direction and control over the employees, including corporate officers, which right may be shared with the client to the degree necessary to allow the client to conduct its business, meet any fiduciary responsibility, or comply with any applicable regulatory or statutory requirements as provided in a professional employer agreement under s. 105.117 (4);

AB1056, s. 15 Section 15. 108.02 (21e) (f) of the statutes is amended to read:

AB1056,27,10 108.02 (21e) (f) Has the obligation to establish, fund, and administer employee benefit plans for the employees, if so agreed to in a professional employer agreement under s. 105.117 (4) (b) 1.; and

AB1056, s. 16 Section 16. 108.02 (21e) (g) of the statutes is amended to read:

AB1056,27,13 108.02 (21e) (g) Provides notice of the employee leasing arrangement to the employees under s. 105.117 (4) (c).

AB1056, s. 17 Section 17 . Nonstatutory provisions.

AB1056,27,21 (1) Rule making. The department of workforce development shall submit in proposed form the rules required under section 105.117 (8) of the statutes, as created by this act, to the legislative council staff under section 227.15 (1) of the statutes no later than the first day of the 6th month beginning after the effective date of this subsection, unless the secretary of administration requires the department to prepare an economic impact report under section 227.137 of the statutes for the proposed rules.

AB1056, s. 18 Section 18. Effective dates. This act takes effect on the first day of the 12th month beginning after publication, except as follows:

AB1056,28,2 (1) Rule making. The treatment of Section 17 (1) of this act takes effect on the day after publication.

AB1056,28,3 (End)