§ 31-221c — Registration as professional employer organization: Requirements. Application. Disclosures. Fees.

(a) Subject to the provisions of subsection (e) of this section, no person shall provide, advertise or otherwise hold itself out as providing professional employer services in this state unless such person is registered as a professional employer organization. Any person seeking initial registration as a professional employer organization shall apply to the Labor Commissioner on a form prescribed by the commissioner. Such application shall include: (1) The name or names under which the applicant will conduct business and, if applicable, under which the applicant conducted business prior to the date of application; (2) The address of the principal place of business of the applicant and the address of each office it maintains or will maintain in this state; (3) The applicant's federal and state taxpayer and employer identification number; (4) A list by jurisdiction of any name under which the applicant operated in the five years preceding the date of application, including any alternative names, names of predecessors, the name of the immediate successor business entity and, if known, any other successor business entities; (5) A statement of ownership that includes the name and evidence of the business experience of any person that, individually or acting in concert with one or more other persons, owns or controls or will control, directly or indirectly, twenty-five per cent or more of the equity interest of the applicant; (6) A statement of management that includes the name and evidence of the business experience of any person who serves or will serve as president, chief executive officer or otherwise has or will have the authority to act as senior executive officer of the applicant; and (7) A financial statement setting forth the financial condition of the applicant in accordance with this subdivision. (A) Except as provided in subparagraph (B) of this subdivision, a professional employer organization or professional employer organization group that conducted business prior to January 1, 2009, shall submit the most recent audit of the professional employer organization or professional employer organization group that was conducted no earlier than thirteen months prior to the date of application. (B) If an applicant has not had sufficient operating history to have audited financial statements based on at least twelve months of operating history, the applicant shall submit a financial statement that sets forth the financial condition of the professional employer organization and is prepared pursuant to generally accepted accounting principles by an independent certified public accountant licensed to do business in the state who attests that (i) it is the applicant's most recent financial statement, (ii) he reviewed the financial statement within six months of the registration, (iii) the applicant is not delinquent in the payment of state or federal taxes, and (iv) the applicant meets the financial capacity requirements of section 31-221d . (C) All information obtained from a professional employer organization or professional employer organization group under this subdivision shall be subject to disclosure in accordance with the provisions of chapter 14. (b) (1) Each professional employer organization operating within this state on January 1, 2009, shall submit its initial registration not later than March 1, 2009. Such initial registration shall be valid until one hundred eighty days after the professional employer organization's first completed fiscal year that is more than one year after March 1, 2009. Each professional employer organization or professional employer organization group shall file with the commissioner the beginning and ending date of each professional employer organization's or professional employer organization group's fiscal year and notify and file with the commissioner any change to the beginning and ending date of such fiscal year. (2) Each professional employer organization not operating within this state as of January 1, 2009, shall complete its initial registration prior to commencement of operations within this state. (c) A registered professional employer organization may apply for renewal of its registration annually by submitting to the commissioner, not later than one hundred eighty days after the end of the professional employer organization's or professional employer organization group's fiscal year, (1) an audit for the preceding fiscal year, and (2) notice of any changes in the information provided in such registrant's immediately preceding application for initial registration or renewal. An applicant may apply for an extension with the department, but any such request shall be accompanied by a letter from the auditor stating the reasons for the delay and the anticipated audit completion date. The financial statement shall be prepared in accordance with generally accepted accounting principles and audited by an independent certified public accountant licensed to practice in the jurisdiction in which such accountant is located, and shall be without qualification as to any increase in going concern status of the professional employer organization. (d) Professional employer organizations in a professional employer organization group may satisfy the reporting and financial requirements of this section and section 31-221d on a combined or consolidated basis provided each member of the professional employer organization group guarantees the obligations under sections 31-221b to 31-221f , inclusive, of each other member of the professional employer organization group. In the case of a professional employer organization group that submits a combined or consolidated audited financial statement, including entities that are not professional employer organizations or that are not in the professional employer organization group, the controlling entity of the professional employer organization group under the consolidated or combined statement shall guarantee the obligations of the professional employer organization in the professional employer organization group. Each professional employer organization or professional employer organization group shall notify the commissioner of the name and address of such controlling entity. (e) (1) The commissioner may issue a professional employer organization a limited registration if such professional employer organization provides evidence, on a form prescribed by the commissioner, that it: (A) Is domiciled outside this state and is licensed or registered as a professional employer organization in another state; (B) Does not maintain an office in this state or directly solicit clients located or domiciled within this state; and (C) Does not have more than fifty covered employees employed or domiciled in this state at any particular time; (2) A limited registration shall be valid for one year and shall be renewed annually at the completion of the registrant's fiscal year. Each professional employer organization or professional employer organization group shall pay a limited registration fee, established by the commissioner when the registration is filed or renewed, not to exceed one thousand dollars and a renewal fee shall not exceed one thousand dollars; (3) If a professional employer organization or professional employer organization group seeks to file a limited registration with the commissioner, the professional employer organization or professional employer organization group shall provide the commissioner with sufficient information and documentation that the professional employer organization or professional employer organization group qualifies for a limited registration. (f) The department shall maintain a list of professional employer organizations registered under this section. (g) The commissioner shall charge a fee on application or renewal for registration as a professional employer organization, provided an initial registration fee shall not exceed one thousand five hundred dollars and a renewal fee shall not exceed one thousand dollars. (h) The registrant shall notify the commissioner of the address of the principal place of business of the registrant and the address of each office it maintains or proposes to maintain in this state. (i) The applicant or registrant shall notify the commissioner of any change of address for any location, as described in subsection (h) of this section, no later than five working days after such change.

Legislative History

(P.A. 08-105, S. 3; P.A. 09-6, S. 1–4.) History: P.A. 08-105 effective January 1, 2009; P.A. 09-6 made technical changes in Subsecs. (a)(5), (b)(1), (e)(3) and (i), effective May 4, 2009.