The purpose of these amendments is to remove old, or outdated materials in reference to rule text and update rule completely.

 

DEPARTMENT OF BUSINESS AND PROFESSIONAL REGULATION

Board of Employee Leasing Companies

RULE NO.:RULE TITLE:

61G7-6.001Definitions

PURPOSE AND EFFECT: The purpose of these amendments is to remove old, or outdated materials in reference to rule text and update rule completely.

SUMMARY: Substantial rewrite of rule text.

SUMMARY OF STATEMENT OF ESTIMATED REGULATORY COSTS AND LEGISLATIVE RATIFICATION:

The Agency has determined that this will not have an adverse impact on small business or likely increase directly or indirectly regulatory costs in excess of $200,000 in the aggregate within one year after the implementation of the rule. A SERC has not been prepared by the Agency.

The Agency has determined that the proposed rule is not expected to require legislative ratification based on the statement of estimated regulatory costs or if no SERC is required, the information expressly relied upon and described herein: During discussion of the economic impact of this rule at its Board meeting, the Board concluded that this rule change will not have any impact on licensees and their businesses or the businesses that employ them. The rule will not increase any fees, business costs, personnel costs, will not decrease profit opportunities, and will not require any specialized knowledge to comply. This change will not increase any direct or indirect regulatory costs. Hence, the Board determined that a Statement of Estimated Regulatory Costs (SERC) was not necessary and that the rule will not require ratification by the Legislature. No person or interested party submitted additional information regarding the economic impact at that time.

Any person who wishes to provide information regarding a statement of estimated regulatory costs, or provide a proposal for a lower cost regulatory alternative must do so in writing within 21 days of this notice.

RULEMAKING AUTHORITY: 468.520, 468.522, 468.525 FS.

LAW IMPLEMENTED: 468.520, 468.522, 458.525(4)(b), 468.529(1) FS.

IF REQUESTED WITHIN 21 DAYS OF THE DATE OF THIS NOTICE, A HEARING WILL BE SCHEDULED AND ANNOUNCED IN THE FAR.

THE PERSON TO BE CONTACTED REGARDING THE PROPOSED RULE IS:

 

THE FULL TEXT OF THE PROPOSED RULE IS:

 

Substantial rewording of Rule 61G7-6.001 follows. See Florida Administrative Code for present text.

61G7-6.001 Definitions.

To enable the Board and the Department to administer Part XI of Chapter 468, F.S., the Board hereby interprets the following terms as used in the definition of employee leasing as follows:

(1) “Health benefits or health plan,” as used in Section 468.529, F.S., means provision of comprehensive major medical health benefits.

(2) “Intangible assets” as used herein to enable initial applicants to properly report their financial assets to meet the requirements for licensure, means assets that lack physical substance. The value of intangible assets is generally based on the value of the rights inherent in them or results from allocation of costs incurred to future periods, in which case they have no realizable or recoverable value outside of their ability to benefit future earnings in the normal course of operations. Intangible assets are normally subject to amortization. Examples of intangible assets include goodwill, copyrights, trademarks, patents, organization costs, deferred costs, client enrollment costs, and excess of assets acquired over purchase price.

(3) “Primarily responsible” as used in Section 468.529(1), F.S., means that the admitted carrier is liable for all claims incurred under the plan of insurance during its effective period, regardless of any reimbursement or indemnification agreement between the licensed employee leasing company and the carrier. Any reimbursement or indemnification agreement between the employee leasing company and the admitted insurance carrier shall not limit or diminish the carrier’s primary responsibility for its obligations under the health plan for the payment of claims incurred or the provision of benefits under the health plan.

(4) “Shared responsibility” as used in Section 468.525(4)(a), F.S., means that the client company exercises such right of direction and control over the leased employee as is necessary to conduct its business and without which the client would be unable to conduct its business, discharge any fiduciary responsibility which it may have, or comply with any applicable licensure, regulatory, or other responsibilities the client company may have.

(5) “Tangible accounting net worth” means net worth presented in accordance with generally accepted accounting principles  reduced by the aggregate amount of intangible assets.

(6) “Temporary” as used in Section 468.520(4), F.S., means a situation in which leased employees are not needed on a long‑term, ongoing basis, but rather are only needed to support or supplement the client company’s work force in special work situations, such as employee absences, temporary skill shortages, seasonal workloads, and special assignments and projects, for a period not to exceed one year.

(7) No reservation, assumption, or retention by an employee leasing company of any responsibility, obligation, authority, or right as set forth in section 468.525(4)(a)-(f) is meant to, or shall be interpreted to, in any way imply or establish a joint employer relationship with any client or to in any way impact a client’s sole responsibility to conduct its business, discharge any fiduciary responsibility that it may have, or comply with any applicable licensure, regulatory, or statutory requirement of the client. The client shall be entitled to exercise all rights, and shall be obligated to perform all duties and responsibilities, otherwise applicable to it as an employer in an employment relationship. Without limiting the foregoing, the following definitions shall apply:

(a) “Assumes responsibility for the payment of wages” as used in Section 468.525(4)(b), F.S., means the obligation of the employee leasing company to comply with the terms of employment established by the employee leasing company with an employee relating to the payment of wages of the employee. The term does not include any obligation on the part of the employee leasing company to assume any contractual obligation which may exist between a client of an employee leasing company and any leased employee, or any other compensation or benefit, in any form, unless the employee leasing company specifically adopts such obligations by way of a written agreement entered into with the leased employee.

(b) “Full Responsibility” as used herein to determine whether an employee leasing company’s contractual arrangements comply with the conditions as set forth in Section 468.525(4)(c), F.S., means complete and total responsibility for the collection of and payment of all payroll taxes on payroll reported to and paid by the employee leasing company, which are payable to the Internal Revenue Service and/or to the State of Florida for services performed by leased employees as leased employees.

(c) “Reserves a right of direction and control over leased employees assigned to the client’s location” as used in Section 468.525(4)(a), F.S., does not imply or require the actual exercise of such direction and control by the employee leasing company. Additionally, the term does not give the employee leasing company the obligation to direct, control, or supervise the work performed by leased employees or give the employee leasing company the right to modify employment conditions of leased employees or to act or interfere with a client’s action. Such reserved right of direction and control shall be imputed for the limited purpose of the employee leasing company’s employer status pursuant to Section 468.529, F.S. with regard to its insurance, employment tax, and benefit plans. The client shall exercise such direction and control as may be allocated to the client, in writing, and in conformity with Florida law.

(d) “Retains authority to hire, terminate, discipline, and reassign the leased employees” as used in Section 468.525(4)(d), F.S., means the employee leasing company has the right to add and remove leased employees from its payroll, but it does not imply or require the actual exercise of such authority by the employee leasing company at the job site at which or from which the leased employees work.   The client shall exercise such authority as may be allocated to it in writing and in conformity with applicable law.

(e) “Retains a right of direction and control over management of safety, risk, and hazard control at the worksite or sites affecting its leased employees, including:              

1. Responsibility for performing safety inspections of client equipment and premises;

2. Responsibility for the promulgation and administration of employment and safety policies; and

3. Responsibility for the management of workers’ compensation claims, claims filings, and related procedures;”

as used in Section 468.525(4)(e), F.S., means the employee leasing company has the right and responsibility to monitor compliance with such workers’ compensation insurance as is maintained by the employee leasing company for leased employees for purposes of the employee leasing company’s internal risk management and to manage workers’ compensation claims, claims filings, and related procedures with respect to such workers’ compensation insurance.  It does not mean that the employee leasing company is responsible, independently or jointly, for the client’s obligations with respect to workplace safety, nor does it imply or require the actual exercise of such direction and control by the employee leasing company. The client shall exercise such direction and control as may be allocated to the client, in writing, and in conformity with applicable law.

(8) As used in Section 468.529, F.S. an employee leasing company’s “employer” status shall only apply to insurance it is required to maintain with respect to leased employees, including providing workers’ compensation coverage pursuant to chapter 440; payment of employment tax for purposes of wages it issues to leased employees, including payment of reemployment assistance taxes pursuant to chapter 443; and benefit plans it sponsors covering leased employees, to the extent consistent with applicable law; and shall not affect the status of a client as an employer of its own leased employees under applicable law nor imply or establish that an employee leasing company and its client are joint employers.

Rulemaking Specific Authority 468.520, 468.522, 468.525 FS. Law Implemented 468.520, 468.522, 4658.525(3), (4)(a)-(e)(b), 468.529(1) FS. History–New 7-20-92, Formerly 21EE-6.001, Amended 9-14-93, 10-24-94, 7-18-95, 4-26-01, 10-13-03, 8-18-04,__________.

 

NAME OF PERSON ORIGINATING PROPOSED RULE: Board of Employee Leasing Companies

NAME OF AGENCY HEAD WHO APPROVED THE PROPOSED RULE: Board of Employee Leasing Companies

DATE PROPOSED RULE APPROVED BY AGENCY HEAD: March 15, 2022

DATE NOTICE OF PROPOSED RULE DEVELOPMENT PUBLISHED IN FAR: December 13, 2021