HOUSE BILL NO. 4545

May 02, 2019, Introduced by Reps. Lilly and Iden and referred to the Committee on Commerce and Tourism.

"Michigan professional employer organization regulatory act,"

by amending section 17 (MCL 338.3737), as amended by 2011 PA 125.

the people of the state of michigan enact:

Sec. 17. (1) Each professional employer agreement executed on or after September 1, 2012 shall must include the following provisions:

(a) The responsibility of the PEO to pay wages to covered employees; to withhold, collect, report and remit payroll-related and unemployment taxes; and, to the extent the PEO has assumed responsibility in the professional employer agreement, to make payments for employee benefits for covered employees. For purposes of this subdivision, wages do not include any obligation between a client and a covered employee for payments beyond, or in addition to, the covered employee's salary, draw, or regular rate of pay, including bonuses, commissions, severance pay, deferred compensation, profit sharing, or vacation, sick, or other paid time off pay, unless the PEO has expressly agreed to assume liability for those payments in the professional employer agreement.

(b) The hiring, disciplining, and termination by the PEO of a covered employee, as necessary to fulfill the PEO's responsibilities under this act and the professional employer agreement. The client may also hire, discipline, and terminate a covered employee.

(c) The responsibility of the client and the PEO to comply with the worker's disability compensation act of 1969, 1969 PA 317, MCL 418.101 to 418.941. Beginning on the effective date of the amendatory act that added this sentence, for purposes of this subdivision, the professional employer agreement must allocate the responsibility to assume liability for compensation and benefits under the worker's disability compensation act of 1969, 1969 PA 317, MCL 418.101 to 418.941, to either the client or the PEO.

(2) Each professional employer agreement executed on or after September 1, 2012 shall require that the PEO provide written notice to each covered employee affected by the agreement regarding the general nature of the coemployment relationship between and among the PEO, the client, and that covered employee.

Enacting section 1. This amendatory act takes effect 90 days after the date it is enacted into law.

Enacting section 2. This amendatory act does not take effect unless Senate Bill No.____ or House Bill No.____ (request no. 01036'19) of the 100th Legislature is enacted into law.