Maine Revised Statutes Title 26 Sec. 1221-A – Employee leasing companies
Current as of: 2023 | Check for updates
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1. Joint and several liability. A client company is jointly and severally liable for unpaid contributions, interest and penalties due under this chapter from the employee leasing company for wages paid to employees leased to the client company.
[PL 1995, c. 221, §1 (AMD).]
Attorney's Note
Under the Maine Revised Statutes, punishments for crimes depend on the classification. In the case of this section:| Class | Prison | Fine |
|---|---|---|
| Class E crime | up to 6 months | up to $1,000 |
Terms Used In Maine Revised Statutes Title 26 Sec. 1221-A
- Benefits: means the money payments payable to an individual, as provided in this chapter, with respect to his unemployment. See Maine Revised Statutes Title 26 Sec. 1043
- Bureau: means the Bureau of Unemployment Compensation, the former Division of Unemployment Compensation in the Bureau of Employment Security. See Maine Revised Statutes Title 26 Sec. 1043
- Calendar quarter: means the period of 3 consecutive calendar months ending on March 31st, June 30th, September 30th or December 31st. See Maine Revised Statutes Title 26 Sec. 1043
- Client company: means a person, association, partnership, corporation or other entity that leases employees from an employee leasing company pursuant to contract. See Maine Revised Statutes Title 26 Sec. 1043
- Commissioner: means the Commissioner of Labor. See Maine Revised Statutes Title 26 Sec. 1043
- Contributions: means the money payments required by this chapter to be made into the fund by an employer on account of having individuals performing services for him. See Maine Revised Statutes Title 26 Sec. 1043
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Employee leasing company: means a business entity that engages in the business of leasing employees to client companies without the client company severing an employer-employee relationship with the employees for services performed for the client company. See Maine Revised Statutes Title 26 Sec. 1043
- Employer: means :
A. See Maine Revised Statutes Title 26 Sec. 1043Employment: except as otherwise provided in paragraph F, subparagraph (2), means any service performed prior to July 26, 1940 which was employment as defined in this subsection prior to such date, and subject to the other provisions of this subsection service performed after July 26, 1940, including service in interstate commerce, performed for wages or under any contract of hire, written or oral, expressed or implied. See Maine Revised Statutes Title 26 Sec. 1043 Partnership: A voluntary contract between two or more persons to pool some or all of their assets into a business, with the agreement that there will be a proportional sharing of profits and losses. State: includes the states of the United States, the District of Columbia, the Commonwealth of Puerto Rico and the Virgin Islands. See Maine Revised Statutes Title 26 Sec. 1043 Wages: means all remuneration for personal services, including commissions, bonuses, severance or terminal pay, gratuities and the cash value of all remuneration in any medium other than cash. See Maine Revised Statutes Title 26 Sec. 1043
2. Liability for contributions. Notwithstanding any other provisions of this chapter, during the term of the employee leasing arrangement, an employee leasing company is liable for the payment of contributions, penalties and interest on wages paid to employees leased to a client company, except compensation paid to sole proprietors of or partners in the client company.
[PL 1991, c. 468, §3 (NEW); PL 1991, c. 468, §6 (AFF).]
3. Reporting requirements. The employee leasing company shall report and pay all contributions under its state employer identification number, using its contribution rate. The employee leasing company shall keep separate records and submit separate quarterly wage reports for each of its client companies to the bureau.
[PL 1991, c. 468, §3 (NEW); PL 1991, c. 468, §6 (AFF).]
4. Administration of benefits. The employee leasing company is responsible for administration of claims for unemployment insurance benefits for the employees leased to each client company.
[PL 1991, c. 468, §3 (NEW).]
5. Surety bond securities.
[PL 1995, c. 221, §2 (RP).]
6. Limitation on application. This section does not apply to private employment agencies that provide their employees to employers on a temporary help basis, if the private employment agencies are liable as employers for the payment of contributions on wages paid to those temporary employees.
[PL 1991, c. 468, §3 (NEW).]
7. Client company ceasing to pay wages. Whenever a client company does not pay wages for a period of 12 consecutive calendar quarters following the latest calendar quarter in which it paid wages, the commissioner shall terminate the client company’s account and experience rating record. If the client company subsequently becomes subject to this section after its account and experience rating record have been terminated, the client company is deemed a new employer for the purposes of this chapter and shall pay contributions at the average contribution rate as defined in section 1221, subsection 4, paragraph A.
[PL 1991, c. 468, §3 (NEW).]
8. Penalty. A person or an employee leasing company that violates this chapter is subject to a forfeiture of $100 per day for each violation. A corporation, partnership, sole proprietorship or other form of business entity and an officer, director, general partner, agent, representative or employee of any of those types of business entities that knowingly uses or participates in an employee leasing agreement, arrangement or mechanism for the purpose of depriving one or more insurers of premiums or avoiding the calculation of the proper contribution rate for purposes of unemployment contributions commits a Class E crime.
[PL 1995, c. 221, §3 (RPR).]
9. Rebuttable presumption. When an employee leasing company leases employees to only one client company or when the leasing company and the client company or companies are owned or controlled by the same parties or interests, directly or indirectly, by legally enforceable means or otherwise, there is a rebuttable presumption that the client company or companies entered into an employee leasing arrangement to avoid the calculation of the proper contribution rate for payment of unemployment contributions.
[PL 1995, c. 221, §4 (NEW).]
SECTION HISTORY
PL 1991, c. 468, §3 (NEW). PL 1991, c. 468, §6 (AFF). PL 1993, c. 264, §§1,2 (AMD). PL 1995, c. 221, §§1-4 (AMD).