controlling person: means a person who, individually or acting in concert with one or more persons, owns, directly or indirectly, 10% or more of the equity interest in a professional employer organization. See Utah Code 31A-40-102
Covered employee: means an individual who has a coemployment relationship with a client and a professional employer organization if the conditions of Section 31A-40-203 are met. See Utah Code 31A-40-102
Employee: means :
(a)
an individual employed by an employer; or
(b)
an individual who meets the requirements of Subsection (53)(b). See Utah Code 31A-1-301
Filing: when used as a noun, means an item required to be filed with the department including:
Guarantee: means to assume an obligation of another person if that person fails to meet the obligation. See Utah Code 31A-40-102
Insurance: includes :
(i)
a risk distributing arrangement providing for compensation or replacement for damages or loss through the provision of a service or a benefit in kind;
(ii)
a contract of guaranty or suretyship entered into by the guarantor or surety as a business and not as merely incidental to a business transaction; and
(iii)
a plan in which the risk does not rest upon the person who makes an arrangement, but with a class of persons who have agreed to share the risk. See Utah Code 31A-1-301
Insured: means a person to whom or for whose benefit an insurer makes a promise in an insurance policy and includes:
Liabilities: The aggregate of all debts and other legal obligations of a particular person or legal entity.
License: includes a certificate of authority issued to an insurer. See Utah Code 31A-1-301
Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
Person: includes :
(a)
an individual;
(b)
a partnership;
(c)
a corporation;
(d)
an incorporated or unincorporated association;
(e)
a joint stock company;
(f)
a trust;
(g)
a limited liability company;
(h)
a reciprocal;
(i)
a syndicate; or
(j)
another similar entity or combination of entities acting in concert. See Utah Code 31A-1-301
professional employer organization: means a person engaged in the business of providing a professional employer service. See Utah Code 31A-40-102
Professional employer service: means the service of entering into a coemployment relationship under this chapter under which all or a majority of the employees who provide a service to a client, or a division or work unit of a client, are covered employees. See Utah Code 31A-40-102
Self-insurance: includes :
(i)
an arrangement under which a governmental entity undertakes to indemnify an employee for liability arising out of the employee's employment; and
(ii)
an arrangement under which a person with a managed program of self-insurance and risk management undertakes to indemnify the person's affiliate, subsidiary, director, officer, or employee for liability or risk that arises out of the person's relationship with the affiliate, subsidiary, director, officer, or employee. See Utah Code 31A-1-301
State: when applied to the different parts of the United States, includes a state, district, or territory of the United States. See Utah Code 68-3-12.5
If a professional employer organization that meets the requirements of Section 31A-40-302 by complying with this section receives a new or renewed certification by the assurance organization, the professional employer organization shall file with the commissioner a new certification within 30 days from the day on which the professional employer organization receives the new or renewed certification from the assurance organization.
(d)
(i)
If a professional employer organization authorizes an assurance organization to act on behalf of the professional employer organization for purposes of licensure under this section, the commissioner shall accept the assurance organization’s filing of the information required by Subsection (1)(a) or (1)(c) if the information otherwise complies with this section and commission rules.
(ii)
Notwithstanding Subsection (1)(d)(i), if the assurance organization fails to make a required filing under this section, the commissioner may not accept, not renew, or terminate the professional employer organization’s license.
(2)
The commissioner shall designate one or more assurance organizations by rule:
that requires that an assurance organization designated by the commissioner be licensed by one or more states other than Utah to certify the qualifications of a professional employer organization.
(3)
The qualifications certified by an assurance organization designated by the commissioner shall include at a minimum that a professional employer organization:
(a)
ensure that each controlling person of the professional employer organization:
(i)
be competent to manage a professional employer organization;
(ii)
be responsible in the controlling person’s finances; and
(iii)
not have a history of or be engaged in unlawful activities;
(b)
has a history that is verifiable that the professional employer organization:
(i)
complies with regulatory requirements; and
(ii)
engages in financially responsible conduct;
(c)
has or is able to obtain audited financial statements;
(d)
has an adjusted net worth equal to or in excess of the greater of:
(i)
$100,000; or
(ii)
5% of total adjusted liabilities;
(e)
has liquid assets that are sufficient to pay short-term liabilities as demonstrated by a ratio determined by dividing current assets by current liabilities or a similar formula;
(f)
has on its books adequate financial reserves for all local, state, and federal self-insurance and any insurancepolicy or plan in which the final cost of coverage is affected by claim losses;
(g)
operates in conformity with all applicable laws and regulations including those laws and regulations in addition to this chapter;
(h)
does not engage in deceptive trade practices or misrepresentations of an employer’s obligation or liability;
(i)
has a written professional employer agreement with each client;
(j)
has or is willing to obtain a written acknowledgment, as part of an existing form or separately, from each covered employee stating that the covered employee understands and accepts the nature, terms, and conditions of the coemployment relationship;
(k)
establishes and maintains a coemployment relationship by assuming key employer attributes with respect to covered employees as demonstrated by the professional employer agreement and employment forms, policies, and procedures;
(l)
provides all covered employees with a written copy of the professional employer organization’s employment policies and procedures;
(m)
ensures that all covered employees are covered in a regulatory compliant manner by workers’ compensation insurance;
(n)
does not knowingly use the coemployment relationship to assist a client to evade or avoid the client’s obligations under:
except through a licensed insurance agent, does not:
(i)
represent or imply that it can sell insurance;
(ii)
attempt to sell insurance; or
(iii)
sell insurance;
(p)
markets and provides, or is willing to market and provide professional employer service under a separate and distinct trade name from any affiliated professional employer organization that is not certified by the assurance organization;
(q)
does not allow any person not certified by the assurance organization to use the professional employer organization’s trade name in the sale or delivery of the professional employer organization’s professional employer service;
(r)
does not guarantee, participate in, transfer between, or otherwise share liabilities with any other professional employer organization that is not certified by the assurance organization:
(i)
in the employment of covered employees; or
(ii)
in any employee benefit or insurance policy or plan that is not fully insured and fully funded; and
(s)
has the ability to provide a regulatory agency or insurance carrier upon request with:
(i)
a client’s name, address, and federal tax identification number;
(ii)
payroll data by:
(A)
client;
(B)
(I)
client SIC Code of the 1987 Standard Industrial Classification Manual of the federal Executive Office of the President, Office of Management and Budget; or
(II)
client classification under the 2002 North American Industry Classification System of the federal Executive Office of the President, Office of Management and Budget; and
(C)
workers’ compensation classification;
(iii)
the names of covered employees by:
(A)
the worksite of a client; and
(B)
workers’ compensation classification; and
(iv)
workers’ compensation certificates of insurance.
(4)
This section does not modify the commissioner’s authority or responsibility to accept, renew, or terminate a license.
