Bill Text: HI SB1062 | 2010 | Regular Session | Amended
Bill Title: Professional Employer Organization
Spectrum: Partisan Bill (Democrat 4-0)
Status: (Passed) 2010-05-21 - (S) Act 129, 5/21/2010 (Gov. Msg. No. 587). [SB1062 Detail]
Download: Hawaii-2010-SB1062-Amended.html
STAND. COM. REP. NO. 712-10
Honolulu, Hawaii
, 2010
RE: S.B. No. 1062
S.D. 1
Honorable Calvin K.Y. Say
Speaker, House of Representatives
Twenty-Fifth State Legislature
Regular Session of 2010
State of Hawaii
Sir:
Your Committees on Labor & Public Employment and Economic Revitalization, Business, & Military Affairs, to which was referred S.B. No. 1062, S.D. 1, entitled:
"A BILL FOR AN ACT RELATING TO PROFESSIONAL EMPLOYER ORGANIZATIONS,"
beg leave to report as follows:
The purpose of this bill is to regulate Professional Employer Organizations (PEOs) in Hawaii as business organizations by requiring PEOs, before entering into any agreement with a client company in Hawaii to:
(1) Register with the Insurance Commissioner and provide information including proof of compliance with Hawaii's employment insurance laws; and
(2) Post a $1,000,000 bond to indemnify the PEO's client companies.
ALTRES, Inc. and the National Association of Professional Employer Organizations testified in support of this bill. ProService Hawaii and a concerned individual supported the intent of this measure. The Department of Commerce and Consumer Affairs provided comments.
PEOs provide a valuable service to many employers by acting as the human resources and administrative offices of these employers and offer services such as payroll preparation, supplying temporary staffing, and providing workers' compensation, health insurance, and enhanced lifestyle benefits. The use of these organizations continues to grow, with over 2,000 Hawaii businesses, encompassing over 20,000 employees, using PEOs to provide various services to their employees.
Although PEOs are currently regulated, certified, or required to be registered in approximately 39 states, Hawaii has no such requirements. Due to the amount of responsibility and finances placed in the hands of PEOs and the negative effects the failure of unscrupulous PEOs would have on local businesses and their employees, your Committees find that these organizations should be regulated.
Recognizing the concern raised that a PEO should also obtain a tax clearance from the Department of Taxation to be registered in Hawaii, your Committees request that this issue be discussed further as the measure makes its way through the legislative process.
As affirmed by the records of votes of the members of your Committees on Labor & Public Employment and Economic Revitalization, Business, & Military Affairs that are attached to this report, your Committees are in accord with the intent and purpose of S.B. No. 1062, S.D. 1, and recommend that it pass Second Reading and be referred to the Committee on Consumer Protection & Commerce.
Respectfully submitted on behalf of the members of the Committees on Labor & Public Employment and Economic Revitalization, Business, & Military Affairs,
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____________________________ ANGUS L.K. MCKELVEY, Chair |
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____________________________ KARL RHOADS, Chair |
