As Passed by the House

128th General Assembly Regular Session 2009-2010

Sub. H. B. No. 216

Representative Carney 

Cosponsors: Representatives Domenick, Murray, Daniels, Adams, R., Amstutz, Bacon, Batchelder, Beck, Belcher, Bolon, Boose, Boyd, Brown, Bubp, Coley, Combs, DeBose, Driehaus, Dyer, Evans, Garland, Gerberry, Goyal, Hackett, Harris, Harwood, Letson, Luckie, Lundy, Newcomb, Patten, Pillich, Pryor, Reece, Sayre, Slesnick, Uecker, Weddington, Williams, B., Winburn, Yuko, Zehringer 

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A BILL

To amend sections 4123.291, 4125.01, 4125.02,

1

4125.03, 4125.05, 4125.07, 4125.08, 4141.24, and

2

5747.07 and to enact sections 4125.041, 4125.042,

3

4125.051, 4125.10, and 4125.11 of the Revised Code

4

to establish certain financial capacity

5

requirements for professional employer

6

organizations, clarify rights and liabilities of

7

professional employer organizations and client

8

employers, and make other changes to the

9

professional employer organization law.

10

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

Section 1. That sections 4123.291, 4125.01, 4125.02, 4125.03,	11
4125.05, 4125.07, 4125.08, 4141.24, and 5747.07 be amended and	12
sections 4125.041, 4125.042, 4125.051, 4125.10, and 4125.11 of the	13
Revised Code be enacted to read as follows:	14

Sec. 4123.291.  (A) An adjudicating committee appointed by	15
the administrator of workers' compensation to hear any matter	16
specified in divisions (B)(1) to (7) of this section shall hear	17
the matter within sixty days of the date on which an employer	18
files the request, protest, or petition. An employer desiring to	19
file a request, protest, or petition regarding any matter	20
specified in divisions (B)(1) to (7) of this section shall file	21
the request, protest, or petition to the adjudicating committee on	22
or before twenty-four months after the administrator sends notice	23
of the determination about which the employer is filing the	24
request, protest, or petition.	25

(B) An employer who is adversely affected by a decision of an	26
adjudicating committee appointed by the administrator may appeal	27
the decision of the committee to the administrator or the	28
administrator's designee. The employer shall file the appeal in	29
writing within thirty days after the employer receives the	30
decision of the adjudicating committee. The administrator or the	31
designee shall hear the appeal and hold a hearing, provided that	32
the decision of the adjudicating committee relates to one of the	33
following:	34

(1) An employer request for a waiver of a default in the	35
payment of premiums pursuant to section 4123.37 of the Revised	36
Code;	37

(2) An employer request for the settlement of liability as a	38
noncomplying employer under section 4123.75 of the Revised Code;	39

(3) An employer petition objecting to the assessment of a	40
premium pursuant to section 4123.37 of the Revised Code and the	41
rules adopted pursuant to that section;	42

(4) An employer request for the abatement of penalties	43
assessed pursuant to section 4123.32 of the Revised Code and the	44
rules adopted pursuant to that section;	45

(5) An employer protest relating to an audit finding or a	46
determination of a manual classification, experience rating, or	47
transfer or combination of risk experience;	48

(6) Any decision relating to any other risk premium matter	49
under Chapters 4121., 4123., and 4131. of the Revised Code;	50

(7) An employer petition objecting to the amount of security	51
required under division (C)(D) of section 4125.05 of the Revised	52
Code and the rules adopted pursuant to that section.	53

(C) The bureau of workers' compensation board of directors,	54
based upon recommendations of the workers' compensation actuarial	55
committee, shall establish the policy for all adjudicating	56
committee procedures, including, but not limited to, specific	57
criteria for manual premium rate adjustment.	58

Sec. 4125.01. As used in this chapter:

59

(A) "Client employer" means a sole proprietor, partnership,	60
association, limited liability company, or corporation that enters	61
into a professional employer organization agreement and is	62
assigned shared employees by the professional employer	63
organization.	64

(B) "Coemploy" means the sharing of the responsibilities and	65
liabilities of being an employer.	66

(C) "Professional employer organization" means a sole	67
proprietor, partnership, association, limited liability company,	68
or corporation that enters into an agreement with one or more	69
client employers for the purpose of coemploying all or part of the	70
client employer's workforce at the client employer's work site.	71

(D) "Professional employer organization agreement" means a	72
written contract to coemploy employees between a professional	73
employer organization and a client employer with a duration of not	74
less than twelve months in accordance with the requirements of	75
this chapter.	76

(E) "Professional employer organization reporting entity"	77
means two or more professional employer organizations that are	78
majority owned or commonly controlled by the same entity, parent,	79
or controlling person and that satisfy reporting entity control	80
rules as defined by the financial accounting standards board and	81
under generally accepted accounting principles.	82

(F) "Shared employee" means an individual intended to be	83
assigned to a client employer on a permanent basis, not as a	84
temporary supplement to the client employer's workforce, who is	85
coemployed by a professional employer organization and a client	86
employer pursuant to a professional employer organization	87
agreement.	88

(F)(G) "Trade secret" has the same meaning as in section	89
1333.61 of the Revised Code.	90

Sec. 4125.02. The administrator of the bureau of workers'	91
compensation shall adopt rules in accordance with Chapter 119. of	92
the Revised Code to administer and enforce this chapter, including	93
rules to administer and enforce division (E) of section 4125.03 of	94
the Revised Code.	95

The administrator may adopt rules for the acceptance of	96
electronic filings in accordance with Chapter 1306. of the Revised	97
Code for applications, documents, reports, and other filings	98
required by this chapter.	99

The administrator may adopt rules allowing an independent	100
assurance organization to act on behalf of a professional employer	101
organization in complying with this chapter and any rules adopted	102
under it. Those rules shall require that the assurance	103
organization be approved by the administrator before acting under	104
the rules and shall include standards and procedures for that	105
approval. The rules also shall permit a professional employer	106
organization to authorize an assurance organization approved by	107
the administrator to act on behalf of the professional employer	108
organization, and the rules shall specify certain provisions of	109
this chapter that may be satisfied by an assurance organization	110
acting with that authority.	111

Sec. 4125.03. (A) The professional employer organization with	112
whom a shared employee is coemployed shall do all of the	113
following:	114

(1) Pay wages associated with a shared employee pursuant to	115
the terms and conditions of compensation in the professional	116
employer organization agreement between the professional employer	117
organization and the client employer;	118

(2) Pay all related payroll taxes associated with a shared	119
employee independent of the terms and conditions contained in the	120
professional employer organization agreement between the	121
professional employer organization and the client employer;	122

(3) Maintain workers' compensation coverage, pay all workers'	123
compensation premiums and manage all workers' compensation claims,	124
filings, and related procedures associated with a shared employee	125
in compliance with Chapters 4121. and 4123. of the Revised Code,	126
except that when shared employees include family farm officers,	127
ordained ministers, or corporate officers of the client employer,	128
payroll reports shall include the entire amount of payroll	129
associated with those persons;	130

(4) Provide written notice to each shared employee it assigns	131
to perform services to a client employer of the relationship	132
between and the responsibilities of the professional employer	133
organization and the client employer;	134

(5) Maintain complete records separately listing the manual	135
classifications of each client employer and the payroll reported	136
to each manual classification for each client employer for each	137
payroll reporting period during the time period covered in the	138
professional employer organization agreement;	139

(6) Maintain a record of workers' compensation claims for	140
each client employer;	141

(7) Within fourteen days after receiving notice from the	142
bureau of workers' compensation that a refund or rebate will be	143
applied to workers' compensation premiums, provide a copy of that	144
notice to any client employer to whom that notice is relevant.	145

(B) TheExcept as provided in section 4125.08 of the Revised	146
Code and unless otherwise agreed to in the professional employer	147
organization agreement, the professional employer organization	148
with whom a shared employee is coemployed has a right of direction	149
and control over each shared employee assigned to a client	150
employer's location. However, a client employer shall retain	151
sufficient direction and control over a shared employee as is	152
necessary to do any of the following:	153

(1) Conduct the client employer's business, including	154
training and supervising shared employees;	155

(2) Ensure the quality, adequacy, and safety of the goods or	156
services produced or sold in the client employer's business;	157

(3) Discharge any fiduciary responsibility that the client	158
employer may have;	159

(4) Comply with any applicable licensure, regulatory, or	160
statutory requirement of the client employer.	161

(C) Notwithstanding division (B) of this section, a client	162
employer may retain sufficient direction and control over a shared	163
employee as is necessary to conduct the client employer's business	164
and to discharge any fiduciary responsibility that it may have, or	165
to comply with any applicable licensure, regulatory, or statutory	166
requirement of the client employerUnless otherwise agreed to in	167
the professional employer organization agreement, liability for	168
acts, errors, and omissions shall be determined as follows:	169

(1) A professional employer organization shall not be liable	170
for the acts, errors, and omissions of a client employer or a	171
shared employee when those acts, errors, and omissions occur under	172
the direction and control of the client employer.	173

(2) A client employer shall not be liable for the acts,	174
errors, and omissions of a professional employer organization or a	175
shared employee when those acts, errors, and omissions occur under	176
the direction and control of the professional employer	177
organization.	178

(D) Nothing in divisions (B) and (C) of this section shall be	179
construed to limit any liability or obligation specifically agreed	180
to in the professional employer organization agreement.	181

(E) No professional employer organization shall coemploy an	182
individual who is an independent contractor of the client employer	183
or knowingly misclassify a shared employee as an independent	184
contractor. A client employer is solely responsible for the proper	185
classification and compliance with all state laws with regard to	186
the classification of an individual as an independent contractor.	187
As used in this division, "independent contractor" means an	188
individual who contracts with a client employer to perform labor	189
or services for the client employer and who satisfies less than	190
ten of the criteria listed in division (A)(1)(c) of section	191
4123.01 of the Revised Code or less than ten of the criteria	192
listed in division (B)(2)(k) of section 4141.01 of the Revised	193
Code.	194

Sec. 4125.041.  A shared employee under a professional	195
employer organization agreement shall not, solely as a result of	196
being a shared employee, be considered an employee of the	197
professional employer organization for purposes of general	198
liability insurance, fidelity bonds, surety bonds, employer	199
liability not otherwise covered by Chapters 4121. and 4123. of the	200
Revised Code, or liquor liability insurance carried by the	201
professional employer organization, unless the professional	202
employer organization agreement and applicable prearranged	203
employment contract, insurance contract, or bond specifically	204
states otherwise.	205

Sec. 4125.042.  (A) For purposes of determining tax credits	206
and other economic incentives that are provided by this state or	207
any political subdivision and based on employment, shared	208
employees under a professional employer organization agreement	209
shall be considered employees solely of the client employer.	210

(1) A client employer shall be entitled to the benefit of any	211
tax credit, economic incentive, or similar benefit arising as the	212
result of the client employer's employment of shared employees. If	213
the grant or amount of any tax credit, economic incentive, or	214
other benefit is based on number of employees, each client	215
employer shall be treated as employing only those shared employees	216
coemployed by the client employer. Shared employees working for	217
other client employers of the professional employer organization	218
shall not be counted as employees for that purpose.	219

(2) Upon request by a client employer or an agency or	220
department of this state, a professional employer organization	221
shall provide employment information reasonably required by the	222
agency or department responsible for administration of the tax	223
credit or economic incentive and necessary to support any request,	224
claim, application, or other action by a client employer seeking	225
the tax credit or economic incentive.	226

(B) Shared employees whose services are subject to sales tax	227
shall be considered the employees of the client employer for	228
purposes of collecting and levying sales tax on the services	229
performed by the shared employee. Nothing contained in this	230
chapter shall relieve a client employer of any sales tax liability	231
with respect to its goods or services.	232

(C) Any tax assessed on a per capita or per employee basis	233
shall be assessed against the client employer for shared employees	234
and against the professional employer organization for employees	235
of the professional employer organization who are not shared	236
employees coemployed with a client employer.	237

(D) For purposes of computing any tax that is imposed or	238
calculated upon the basis of total payroll, the professional	239
employer organization shall be eligible to use any small business	240
allowance or exemption that is available to the client employer	241
for the shared employees.	242

Sec. 4125.05. (A) Not later than thirty days after November	243
5, 2004, or not later than thirty days after the formation of a	244
professional employer organization, whichever date occurs later, a	245
professional employer organization operating in this state shall	246
register with the administrator of the bureau of workers'	247
compensation on forms provided by the administrator. Following	248
initial registration, each professional employer organization	249
shall register with the administrator annually on or before the	250
thirty-first day of December.	251

(B) Initial registration and each annual registration renewal	252
shall include all of the following:	253

(1) A list of each of the professional employer	254
organization's client employers current as of the date of	255
registration for purposes of initial registration or current as of	256
the date of annual registration renewal, or within fourteen days	257
of adding or releasing a client, that includes the client	258
employer's name, address, federal tax identification number, and	259
bureau of workers' compensation risk number;	260

(2) A fee as determined by the administrator;

261

(3) The name or names under which the professional employer	262
organization conducts business;	263

(4) The address of the professional employer organization's	264
principal place of business and the address of each office it	265
maintains in this state;	266

(5) The professional employer organization's taxpayer or	267
employer identification number;	268

(6) A list of each state in which the professional employer	269
organization has operated in the preceding five years, and the	270
name, corresponding with each state, under which the professional	271
employer organization operated in each state, including any	272
alternative names, names of predecessors, and if known, successor	273
business entities;	274

(7) A financial statement prepared and audited in accordance	275
with division (B) of section 4125.051 of the Revised Code;	276

(8) If there is any deficit in the working capital required	277
under division (A) of section 4125.051 of the Revised Code, a	278
bond, irrevocable letter of credit, or securities with a minimum	279
market value in an amount sufficient to cover the deficit in	280
accordance with the requirements of that section.	281

(C) Upon terms and for periods that the administrator	282
considers appropriate, the administrator may issue a limited	283
registration to a professional employer organization or	284
professional employer organization reporting entity that provides	285
all of the following items:	286

(1) A properly executed request for limited registration on a	287
form provided by the administrator;	288

(2) All information and materials required for registration	289
in divisions (B)(1) to (6) of this section;	290

(3) Information and documentation necessary to show that the	291
professional employer organization or professional employer	292
organization reporting entity satisfies the following criteria:	293

(a) It is domiciled outside of this state.

294

(b) It is licensed or registered as a professional employer	295
organization in another state.	296

(c) It does not maintain an office in this state.

297

(d) It does not participate in direct solicitations for	298
client employers located or domiciled in this state.	299

(e) It has fifty or fewer shared employees employed or	300
domiciled in this state on any given day.	301

(D)(1) The administrator, with the advice and consent of the	302
bureau of workers' compensation board of directors, shall adopt	303
rules in accordance with Chapter 119. of the Revised Code to	304
require, in addition to the requirement under division (B)(8) of	305
this section and except as otherwise specified in division	306
(C)(D)(2) of this section, a professional employer organization to	307
provide security in the form of a bond or letter of credit	308
assignable to the Ohio bureau of workers' compensation not to	309
exceed an amount equal to the premiums and assessments incurred	310
for the two most recent payroll periods, prior to any discounts or	311
dividends, to meet the financial obligations of the professional	312
employer organization pursuant to this chapter and Chapters 4121.	313
and 4123. of the Revised Code.	314

(2) As an alternative to providing security in the form of a	315
bond or letter of credit under division (D)(1) of this section,	316
the administrator shall permit a professional employer	317
organization to make periodic payments of prospective premiums and	318
assessments to the bureau or to submit proof of being certified by	319
either a nationally recognized organization that certifies	320
professional employer organizations or by a government entity	321
approved by the administrator.	322

(3) A professional employer organization may appeal the	323
amount of the security required pursuant to rules adopted under	324
division (C)(D)(1) of this section in accordance with section	325
4123.291 of the Revised Code.	326

(D)(E) Notwithstanding division (C)(D) of this section, a	327
professional employer organization that qualifies for	328
self-insurance or retrospective rating under section 4123.29 or	329
4123.35 of the Revised Code shall abide by the financial	330
disclosure and security requirements pursuant to those sections	331
and the rules adopted under those sections in place of the	332
requirements specified in division (C)(D) of this section or	333
specified in rules adopted pursuant to that division.	334

(E)(F) Except to the extent necessary for the administrator	335
to administer the statutory duties of the administrator and for	336
employees of the state to perform their official duties, all	337
records, reports, client lists, and other information obtained	338
from a professional employer organization and professional	339
employer organization reporting entity under divisions (A), (B),	340
and (B)(C) of this section are confidential and shall be	341
considered trade secrets and shall not be published or open to	342
public inspection.	343

(F)(G) The list described in division (B)(1) of this section	344
shall be considered a trade secret.	345

(G)(H) The administrator shall establish the fee described in	346
division (B)(2) of this section in an amount that does not exceed	347
the cost of the administration of the initial and renewal	348
registration process.	349

(I) A financial statement required under division (B)(7) of	350
this section for initial registration shall be the most recent	351
financial statement of the professional employer organization or	352
professional employer organization reporting entity of which the	353
professional employer organization is a member and shall not be	354
older than thirteen months. For each registration renewal, the	355
professional employer organization shall file the required	356
financial statement within one hundred eighty days after the end	357
of the professional employer organization's or professional	358
employer organization reporting entity's fiscal year. A	359
professional employer organization may apply to the administrator	360
for an extension beyond that time if the professional employer	361
organization provides the administrator with a letter from the	362
professional employer organization's auditor stating the reason	363
for delay and the anticipated completion date.	364

(J) Multiple, unrelated professional employer organizations	365
shall not combine together for purposes of obtaining workers'	366
compensation coverage or for forming any type of self-insurance	367
arrangement available under this chapter. Multiple, unrelated	368
professional employer organization reporting entities shall not	369
combine together for purposes of obtaining workers' compensation	370
coverage or for forming any type of self-insurance arrangement	371
available under this chapter.	372

(K) The administrator shall maintain a list of professional	373
employer organizations and professional employer organization	374
reporting entities registered under this section that is readily	375
available to the public by electronic or other means.	376

Sec. 4125.051. (A) A professional employer organization, or a	377
professional employer organization reporting entity of which the	378
professional employer organization is a member, shall maintain	379
positive working capital as defined by generally accepted	380
accounting principles. If a deficit in working capital exists at	381
any time, the professional employer organization or the	382
professional employer organization reporting entity shall do both	383
of the following:	384

(1) Obtain a bond, irrevocable letter of credit, or	385
securities with a minimum market value in an amount sufficient to	386
cover the deficit in working capital;	387

(2) Submit to the administrator of workers' compensation a	388
quarterly financial statement for each calendar quarter during	389
which there is a deficit in working capital, accompanied by an	390
attestation of the chief executive officer of the professional	391
employer organization that all wages, taxes, workers' compensation	392
premiums, and employee benefits have been paid by the professional	393
employer organization or members of the professional employer	394
organization reporting entity.	395

The bond, letter of credit, or securities required under	396
division (A)(1) of this section shall be held by a depository	397
designated by the administrator and shall secure payment by the	398
professional employer organization of all taxes, wages, benefits,	399
or other entitlements due or otherwise pertaining to shared	400
employees, if the professional employer organization does not make	401
those payments when due.	402

(B) A professional employer organization, or a professional	403
employer organization reporting entity of which the professional	404
employer organization is a member, shall prepare a financial	405
statement for registration and registration renewal under section	406
4125.05 of the Revised Code in accordance with generally accepted	407
accounting principles. The financial statement shall clearly	408
demonstrate the professional employer organization's or	409
professional employer organization reporting entity's compliance	410
with the financial capacity requirements of division (A) of this	411
section and shall be unqualified as to the going concern status of	412
the professional employer organization or professional employer	413
organization reporting entity.	414

The financial statement shall be audited by an independent	415
certified public accountant authorized to practice in the	416
jurisdiction in which that accountant is located. However, if a	417
professional employer organization does not have at least twelve	418
months of operating history on which to base an audit, the	419
financial statement shall be reviewed by a certified public	420
accountant.	421

(C) Professional employer organizations in a professional	422
employer organization reporting entity may satisfy the	423
requirements of this section on a combined or consolidated basis	424
provided that each member of the professional employer	425
organization reporting entity guarantees each other members'	426
satisfaction of the requirements under division (A) of this	427
section.	428

For purposes of satisfying the registration and registration	429
renewal requirements described in division (B)(7) of section	430
4125.05 of the Revised Code, a professional employer organization	431
reporting entity may submit a combined or consolidated financial	432
statement that satisfies the requirements of this section. If the	433
combined or consolidated financial statement includes entities	434
that are not professional employer organizations or that are not	435
in the professional employer organization reporting entity, the	436
controlling entity of the professional employer organization	437
reporting entity that is submitting the consolidated or combined	438
financial statement shall guarantee that the professional employer	439
organizations of the professional employer organization reporting	440
entity have satisfied the requirements under division (A) of this	441
section and shall include supplemental combining schedules to	442
guarantee that the requirements under division (A) of this section	443
are satisfied by the professional employer organization or	444
professional employer organization reporting entity.	445

Sec. 4125.07. Not later than fourteen calendar days after the	446
date on which a professional employer organization agreement is	447
terminated, the professional employer organization is adjudged	448
bankrupt, the professional employer organization ceases operations	449
within the state of Ohio, or the registration of the professional	450
employer organization is revoked, the professional employer	451
organization shall submit to the administrator of the bureau of	452
workers' compensation and each client employer associated with	453
that professional employer organization a completed workers'	454
compensation lease termination notice form provided by the	455
administrator. The completed form shall include all client payroll	456
and claim information listed in a format specified by the	457
administrator and notice of all workers' compensation claims that	458
have been reported to the professional employer organization in	459
accordance with its internal reporting policies.	460

A professional employer organization shall report any	461
transfer of employees between related professional employer	462
organization entities or professional employer organization	463
reporting entities to the administrator within fourteen calendar	464
days after the date of the transfer on a form prescribed by the	465
administrator. The professional employer organization or	466
professional employer organization reporting entity shall include	467
in the form all client payroll and claim information regarding the	468
transferred employees listed in a format specified by the	469
administrator and a notice of all workers' compensation claims	470
that have been reported to the professional employer organization	471
or professional employer organization reporting entity in	472
accordance with the internal reporting policies of the	473
professional employer organization or professional employer	474
organization reporting entity.	475

Sec. 4125.08. Nothing in this chapter exempts a professional	476
employer organization, client employer, or shared employee from	477
any applicable federal, state, or local licensing, registration,	478
or certification statutes or regulations. An individual required	479
to obtain and maintain a license, registration, or certification	480
under law and who is a shared employee of a professional employer	481
organization and a client employer is an employee of the client	482
employer for purposes of obtaining and maintaining the appropriate	483
license, registration, or certification as required by law. A	484
professional employer organization does not engage in any	485
occupation, trade, or profession that requires a license,	486
certification, or registration solely by entering into a	487
professional employer agreement with a client employer or	488
coemploying a shared employee.	489

A client employer shall have the sole right of direction and	490
control of the professional or licensed activities of shared	491
employees and of the client employer's business. The shared	492
employees and client employers shall remain subject to regulation	493
by the board, commission, or agency responsible for licensing,	494
registration, or certification of the shared employees or client	495
employers.	496

Sec. 4125.10.  Nothing contained in this chapter or in any	497
professional employer organization agreement shall do any of the	498
following:	499

(A) Diminish, abolish, or remove the rights and obligations	500
of client employers and shared employees existing prior to the	501
effective date of the professional employer organization	502
agreement;	503

(B) Affect, modify, or amend any contractual relationship or	504
restrictive covenant between a shared employee and any client	505
employer in effect at the time a professional employer	506
organization agreement becomes effective;	507

(C) Prohibit or amend any contractual relationship or	508
restrictive covenant between a client employer and a shared	509
employee that is entered into after the professional employer	510
organization agreement becomes effective;	511

(D) Create any new or additional enforcement right of a	512
shared employee against a professional employer organization that	513
is not specifically provided by the professional employer	514
organization agreement or this chapter.	515

A professional employer organization shall have no	516
responsibility or liability in connection with, or arising out of,	517
any contractual relationship or restrictive covenant between a	518
client employer and a shared employee unless the professional	519
employer organization has specifically agreed otherwise in	520
writing.	521

Sec. 4125.11.  For purposes of a bid, contract, purchase	522
order, or agreement entered into with the state or any political	523
subdivision, a client employer's status or certification as a	524
small, minority-owned, disadvantaged, or woman-owned business	525
enterprise or as a historically underutilized business shall not	526
be affected as a result of the client employer entering into a	527
professional employer organization agreement or using the services	528
of a professional employer organization.	529

Sec. 4141.24.  (A)(1) The director of job and family services	530
shall maintain a separate account for each employer and, except as	531
otherwise provided in division (B) of section 4141.25 of the	532
Revised Code respecting mutualized contributions, shall credit	533
such employer's account with all the contributions, or payments in	534
lieu of contributions, which the employer has paid on the	535
employer's own behalf.	536

(2) If, as of the computation date, a contributory employer's	537
account shows a negative balance computed as provided in division	538
(A)(3) of section 4141.25 of the Revised Code, less any	539
contributions due and unpaid on such date, which negative balance	540
is in excess of the limitations imposed by divisions (A)(2)(a),	541
(b), and (c) of this section and if the employer's account is	542
otherwise eligible for the transfer, then before the employer's	543
contribution rate is computed for the next succeeding contribution	544
period, an amount equal to the amount of the excess eligible for	545
transfer shall be permanently transferred from the account of such	546
employer and charged to the mutualized account provided in	547
division (B) of section 4141.25 of the Revised Code.	548

(a) If as of any computation date, a contributory employer's	549
account shows a negative balance in excess of ten per cent of the	550
employer's average annual payroll, then before the employer's	551
contribution rate is computed for the next succeeding contribution	552
period, an amount equal to the amount of the excess shall be	553
transferred from the account as provided in this division. No	554
contributory employer's account may have any excess transferred	555
pursuant to division (A)(2)(a) of this section, unless the	556
employer's account has shown a positive balance for at least two	557
consecutive computation dates prior to the computation date with	558
respect to which the transfer is proposed. Each time a transfer is	559
made pursuant to division (A)(2)(a) of this section, the	560
employer's account is ineligible for any additional transfers	561
under that division, until the account shows a positive balance	562
for at least two consecutive computation dates subsequent to the	563
computation date of which the most recent transfer occurs pursuant	564
to division (A)(2)(a), (b), or (c) of this section.	565

(b) If at the next computation date after the computation	566
date at which a transfer from the account occurs pursuant to	567
division (A)(2)(a) of this section, a contributory employer's	568
account shows a negative balance in excess of fifteen per cent of	569
the employer's average annual payroll, then before the employer's	570
contribution rate is computed for the next succeeding contribution	571
period an amount equal to the amount of the excess shall be	572
permanently transferred from the account as provided in this	573
division.	574

(c) If at the next computation date subsequent to the	575
computation date at which a transfer from a contributory	576
employer's account occurs pursuant to division (A)(2)(b) of this	577
section, the employer's account shows a negative balance in excess	578
of twenty per cent of the employer's average annual payroll, then	579
before the employer's contribution rate is computed for the next	580
succeeding contribution period, an amount equal to the amount of	581
the excess shall be permanently transferred from the account as	582
provided in this division.	583

(d) If no transfer occurs pursuant to division (A)(2)(b) or	584
(c) of this section, the employer's account is ineligible for any	585
additional transfers under division (A)(2) of this section until	586
the account requalifies for a transfer pursuant to division	587
(A)(2)(a) of this section.	588

(B) Any employer may make voluntary payments in addition to	589
the contributions required under this chapter, in accordance with	590
rules established by the director. Such payments shall be included	591
in the employer's account as of the computation date, provided	592
they are received by the director by the thirty-first day of	593
December following such computation date. Such voluntary payment,	594
when accepted from an employer, will not be refunded in whole or	595
in part. In determining whether an employer's account has a	596
positive balance on two consecutive computation dates and is	597
eligible for transfers under division (A)(2) of this section, the	598
director shall exclude any voluntary payments made subsequent to	599
the last transfer made under division (A)(2) of this section.	600

(C) All contributions to the fund shall be pooled and	601
available to pay benefits to any individual entitled to benefits	602
irrespective of the source of such contributions.	603

(D)(1) For the purposes of this section and sections 4141.241	604
and 4141.242 of the Revised Code, an employer's account shall be	605
charged only for benefits based on remuneration paid by such	606
employer. Benefits paid to an eligible individual shall be charged	607
against the account of each employer within the claimant's base	608
period in the proportion to which wages attributable to each	609
employer of the claimant bears to the claimant's total base period	610
wages. Charges to the account of a base period employer with whom	611
the claimant is employed part-time at the time the claimant's	612
application for a determination of benefits rights is filed shall	613
be charged to the mutualized account when all of the following	614
conditions are met:	615

(a) The claimant also worked part-time for the employer	616
during the base period of the claim.	617

(b) The claimant is unemployed due to loss of other	618
employment.	619

(c) The employer is not a reimbursing employer under section	620
4141.241 or 4141.242 of the Revised Code.	621

(2) Notwithstanding division (D)(1) of this section, charges	622
to the account of any employer, including any reimbursing	623
employer, shall be charged to the mutualized account if it finally	624
is determined by a court on appeal that the employer's account is	625
not chargeable for the benefits.	626

(3) Any benefits paid to a claimant under section 4141.28 of	627
the Revised Code prior to a final determination of the claimant's	628
right to the benefits shall be charged to the employer's account	629
as provided in division (D)(1) of this section, provided that if	630
there is no final determination of the claim by the subsequent	631
thirtieth day of June, the employer's account shall be credited	632
with the total amount of benefits that has been paid prior to that	633
date, based on the determination that has not become final. The	634
total amount credited to the employer's account shall be charged	635
to a suspense account, which shall be maintained as a separate	636
bookkeeping account and administered as a part of this section,	637
and shall not be used in determining the account balance of the	638
employer for the purpose of computing the employer's contribution	639
rate under section 4141.25 of the Revised Code.	640

If it is finally determined that the claimant is entitled to	641
all or a part of the benefits in dispute, the suspense account	642
shall be credited and the appropriate employer's account charged	643
with the benefits. If it is finally determined that the claimant	644
is not entitled to all or any portion of the benefits in dispute,	645
the benefits shall be credited to the suspense account and a	646
corresponding charge made to the mutualized account established in	647
division (B) of section 4141.25 of the Revised Code, provided	648
that, except as otherwise provided in this section, if benefits	649
are chargeable to an employer or group of employers who is	650
required or elects to make payments to the fund in lieu of	651
contributions under section 4141.241 of the Revised Code, the	652
benefits shall be charged to the employer's account in the manner	653
provided in division (D)(1) of this section and division (B) of	654
section 4141.241 of the Revised Code, and no part of the benefits	655
may be charged to the suspense account provided in this division.	656

To the extent that benefits that have been paid to a claimant	657
and charged to the employer's account are found not to be due the	658
claimant and are recovered by the director as provided in section	659
4141.35 of the Revised Code, they shall be credited to the	660
employer's account.	661

(4) The director shall notify each employer at least once	662
each month of the benefits charged to the employer's account since	663
the last preceding notice; except that for the purposes of	664
sections 4141.241 and 4141.242 of the Revised Code which provides	665
the billing of employers on a payment in lieu of a contribution	666
basis, the director may prescribe a quarterly or less frequent	667
notice of benefits charged to the employer's account. Such notice	668
will show a summary of the amount of benefits paid which were	669
charged to the employer's account. This notice shall not be deemed	670
a determination of the claimant's eligibility for benefits. Any	671
employer so notified, however, may file within fifteen days after	672
the mailing date of the notice, an exception to charges appearing	673
on the notice on the grounds that such charges are not in	674
accordance with this section. The director shall promptly examine	675
the exception to such charges and shall notify the employer of the	676
director's decision thereon, which decision shall become final	677
unless appealed to the unemployment compensation review commission	678
in the manner provided in section 4141.26 of the Revised Code. For	679
the purposes of this division, an exception is considered timely	680
filed when it has been received as provided in division (D)(1) of	681
section 4141.281 of the Revised Code.	682

(E) The director shall terminate and close the account of any	683
contributory employer who has been subject to this chapter if the	684
enterprise for which the account was established is no longer in	685
operation and it has had no payroll and its account has not been	686
chargeable with benefits for a period of five consecutive years.	687
The amount of any positive balance, computed as provided in	688
division (A)(3) of section 4141.25 of the Revised Code, in an	689
account closed and terminated as provided in this section shall be	690
credited to the mutualized account as provided in division	691
(B)(2)(b) of section 4141.25 of the Revised Code. The amount of	692
any negative balance, computed as provided in division (A)(3) of	693
section 4141.25 of the Revised Code, in an account closed and	694
terminated as provided in this section shall be charged to the	695
mutualized account as provided in division (B)(1)(b) of section	696
4141.25 of the Revised Code. The amount of any positive balance or	697
negative balance, credited or charged to the mutualized account	698
after the termination and closing of an employer's account, shall	699
not thereafter be considered in determining the contribution rate	700
of such employer. The closing of an employer's account as provided	701
in this division shall not relieve such employer from liability	702
for any unpaid contributions or payment in lieu of contributions	703
which are due for periods prior to such closing.	704

If the director finds that a contributory employer's business	705
is closed solely because of the entrance of one or more of the	706
owners, officers, or partners, or the majority stockholder, into	707
the armed forces of the United States, or any of its allies, or of	708
the United Nations after July 1, 1950, such employer's account	709
shall not be terminated and if the business is resumed within two	710
years after the discharge or release of such persons from active	711
duty in the armed forces, the employer's experience shall be	712
deemed to have been continuous throughout such period. The reserve	713
ratio of any such employer shall be the total contributions paid	714
by such employer minus all benefits, including benefits paid to	715
any individual during the period such employer was in the armed	716
forces, based upon wages paid by the employer prior to the	717
employer's entrance into the armed forces divided by the average	718
of the employer's annual payrolls for the three most recent years	719
during the whole of which the employer has been in business.	720

(F) If an employer transfers all of its trade or business to	721
another employer or person, the acquiring employer or person shall	722
be the successor in interest to the transferring employer and	723
shall assume the resources and liabilities of such transferring	724
employer's account, and continue the payment of all contributions,	725
or payments in lieu of contributions, due under this chapter.	726

If an employer or person acquires substantially all, or a	727
clearly segregable and identifiable portion of an employer's trade	728
or business, then upon the director's approval of a properly	729
completed application for successorship, the employer or person	730
acquiring the trade or business, or portion thereof, shall be the	731
successor in interest. The director by rule may prescribe	732
procedures for effecting transfers of experience as provided for	733
in this section.	734

(G) Notwithstanding sections 4141.09, 4141.23, 4141.24,	735
4141.241, 4141.242, 4141.25, 4141.26, and 4141.27 of the Revised	736
Code, both of the following apply regarding assignment of rates	737
and transfers of experience:	738

(1) If an employer transfers its trade or business, or a	739
portion thereof, to another employer and, at the time of the	740
transfer, both employers are under substantially common ownership,	741
management, or control, then the unemployment experience	742
attributable to the transferred trade or business, or portion	743
thereof, shall be transferred to the employer to whom the business	744
is so transferred. The director shall recalculate the rates of	745
both employers and those rates shall be effective immediately upon	746
the date of the transfer of the trade or business.	747

(2) Whenever a person is not an employer under this chapter	748
at the time the person acquires the trade or business of an	749
employer, the unemployment experience of the acquired trade or	750
business shall not be transferred to the person if the director	751
finds that the person acquired the trade or business solely or	752
primarily for the purpose of obtaining a lower rate of	753
contributions. Instead, that person shall be assigned the	754
applicable new employer rate under division (A)(1) of section	755
4141.25 of the Revised Code.	756

(H) The director shall establish procedures to identify the	757
transfer or acquisition of a trade or business for purposes of	758
this section and shall adopt rules prescribing procedures for	759
effecting transfers of experience as described in this section.	760

(I) No rate of contribution less than two and seven-tenths	761
per cent shall be permitted a contributory employer succeeding to	762
the experience of another contributory employer pursuant to this	763
section for any period subsequent to such succession, except in	764
accordance with rules prescribed by the director, which rules	765
shall be consistent with federal requirements for additional	766
credit allowance in section 3303 of the "Internal Revenue Code of	767
1954" and consistent with this chapter, except that such rules may	768
establish a computation date for any such period different from	769
the computation date generally prescribed by this chapter, and may	770
define "calendar year" as meaning a twelve-consecutive-month	771
period ending on the same day of the year as that on which such	772
computation date occurs.	773

(J) The director may prescribe rules for the establishment,	774
maintenance, and dissolution of common contribution rates for two	775
or more contributory employers, and in accordance with such rules	776
and upon application by two or more employers shall establish such	777
common rate to be computed by merging the several contribution	778
rate factors of such employers for the purpose of establishing a	779
common contribution rate applicable to all such employers.	780

(K) The director shall adopt rules applicable to professional	781
employer organizations and professional employer organization	782
reporting entities to address the method in which a professional	783
employer organization or professional employer organization	784
reporting entity reports quarterly wages and contributions to the	785
director for shared employees.	786

(1) The rules shall recognize a professional employer	787
organization or professional employer organization reporting	788
entity as the employer of record of the shared employees of the	789
professional employer organization or professional employer	790
organization reporting entity for reporting purposes; however, the	791
rules may require that each shared employee of a single client	792
employer be reported under a separate and unique subaccount of the	793
professional employer organization or professional employer	794
organization reporting entity to reflect the experience of the	795
shared employees of that client employer.	796

(2) The director shall use a subaccount solely to determine	797
experience rates for that individual subaccount on an annual basis	798
and shall recognize a professional employer organization or	799
professional employer organization reporting entity as the	800
employer of record associated with each subaccount. The director	801
shall combine the rate experience that existed on a client	802
employer's account prior to entering into a professional employer	803
organization agreement with the experience accumulated as a	804
subaccount of the professional employer organization or	805
professional employer organization reporting entity. The combined	806
experience shall remain with the client account upon termination	807
of the professional employer organization agreement.	808

(3) A professional employer organization or professional	809
employer organization reporting entity shall provide a power of	810
attorney or other evidence, which evidence may be included as part	811
of a professional employer organization agreement, completed by	812
each client employer of the professional employer organization or	813
professional employer organization reporting entity, authorizing	814
the professional employer organization or professional employer	815
organization reporting entity to act on behalf of the client	816
employer in accordance with the requirements of this chapter.	817

(4) Any rule adopted pursuant to division (K) of this section	818
also shall include administrative requirements that permit a	819
professional employer organization or a professional employer	820
organization reporting entity to transmit any reporting and	821
payment data required under division (K)(1) of this section	822
collectively as a single filing with the director.	823

(5) As used in division (K) of this section, "client	824
employer," "professional employer organization," "professional	825
employer organization agreement," "professional employer	826
organization reporting entity," and "shared employee" have the	827
same meanings as in section 4125.01 of the Revised Code.	828

Sec. 5747.07.  (A) As used in this section:

829

(1) "Partial weekly withholding period" means a period during	830
which an employer directly, indirectly, or constructively pays	831
compensation to, or credits compensation to the benefit of, an	832
employee, and that consists of a consecutive Saturday, Sunday,	833
Monday, and Tuesday or a consecutive Wednesday, Thursday, and	834
Friday. There are two partial weekly withholding periods each	835
week, except that a partial weekly withholding period cannot	836
extend from one calendar year into the next calendar year; if the	837
first day of January falls on a day other than Saturday or	838
Wednesday, the partial weekly withholding period ends on the	839
thirty-first day of December and there are three partial weekly	840
withholding periods during that week.	841

(2) "Undeposited taxes" means the taxes an employer is	842
required to deduct and withhold from an employee's compensation	843
pursuant to section 5747.06 of the Revised Code that have not been	844
remitted to the tax commissioner pursuant to this section or to	845
the treasurer of state pursuant to section 5747.072 of the Revised	846
Code.	847

(3) A "week" begins on Saturday and concludes at the end of	848
the following Friday.	849

(4) "Client employer," "professional employer organization,"	850
"professional employer organization agreement," and "professional	851
employer organization reporting entity" have the same meanings as	852
in section 4125.01 of the Revised Code.	853

(B) Except as provided in divisions (C) and (D) of this	854
section and in division (A) of section 5747.072 of the Revised	855
Code, every employer required to deduct and withhold any amount	856
under section 5747.06 of the Revised Code shall file a return and	857
shall pay the amount required by law as follows:	858

(1) An employer who accumulates or is required to accumulate	859
undeposited taxes of one hundred thousand dollars or more during a	860
partial weekly withholding period shall make the payment of the	861
undeposited taxes by the close of the first banking day after the	862
day on which the accumulation reaches one hundred thousand	863
dollars. If required under division (I) of this section, the	864
payment shall be made by electronic funds transfer under section	865
5747.072 of the Revised Code.	866

(2)(a) Except as required by division (B)(1) of this section,	867
an employer described in division (B)(2)(b) of this section shall	868
make the payment of undeposited taxes within three banking days	869
after the close of a partial weekly withholding period during	870
which the employer was required to deduct and withhold any amount	871
under this chapter. If required under division (I) of this	872
section, the payment shall be made by electronic funds transfer	873
under section 5747.072 of the Revised Code.	874

(b) For amounts required to be deducted and withheld during	875
1994, an employer described in division (B)(2)(b) of this section	876
is one whose actual or required payments under this section	877
exceeded one hundred eighty thousand dollars during the	878
twelve-month period ending June 30, 1993. For amounts required to	879
be deducted and withheld during 1995 and each year thereafter, an	880
employer described in division (B)(2)(b) of this section is one	881
whose actual or required payments under this section were at least	882
eighty-four thousand dollars during the twelve-month period ending	883
on the thirtieth day of June of the preceding calendar year.	884

(3) Except as required by divisions (B)(1) and (2) of this	885
section, if an employer's actual or required payments were more	886
than two thousand dollars during the twelve-month period ending on	887
the thirtieth day of June of the preceding calendar year, the	888
employer shall make the payment of undeposited taxes for each	889
month during which they were required to be withheld no later than	890
fifteen days following the last day of that month. The employer	891
shall file the return prescribed by the tax commissioner with the	892
payment.	893

(4) Except as required by divisions (B)(1), (2), and (3) of	894
this section, an employer shall make the payment of undeposited	895
taxes for each calendar quarter during which they were required to	896
be withheld no later than the last day of the month following the	897
last day of March, June, September, and December each year. The	898
employer shall file the return prescribed by the tax commissioner	899
with the payment.	900

(C) The return and payment schedules prescribed by divisions	901
(B)(1) and (2) of this section do not apply to the return and	902
payment of undeposited school district income taxes arising from	903
taxes levied pursuant to Chapter 5748. of the Revised Code.	904
Undeposited school district income taxes shall be returned and	905
paid pursuant to divisions (B)(3) and (4) of this section, as	906
applicable.	907

(D)(1) The requirements of division (B) of this section are	908
met if the amount paid is not less than ninety-five per cent of	909
the actual tax withheld or required to be withheld for the prior	910
quarterly, monthly, or partial weekly withholding period, and the	911
underpayment is not due to willful neglect. Any underpayment of	912
withheld tax shall be paid within thirty days of the date on which	913
the withheld tax was due without regard to division (D)(1) of this	914
section. An employer described in division (B)(1) or (2) of this	915
section shall make the payment by electronic funds transfer under	916
section 5747.072 of the Revised Code.	917

(2) If the tax commissioner believes that quarterly or	918
monthly payments would result in a delay that might jeopardize the	919
remittance of withholding payments, the commissioner may order	920
that the payments be made weekly, or more frequently if necessary,	921
and the payments shall be made no later than three banking days	922
following the close of the period for which the jeopardy order is	923
made. An order requiring weekly or more frequent payments shall be	924
delivered to the employer personally or by certified mail and	925
remains in effect until the commissioner notifies the employer to	926
the contrary.	927

(3) If compelling circumstances exist concerning the	928
remittance of undeposited taxes, the commissioner may order the	929
employer to make payments under any of the payment schedules under	930
division (B) of this section. The order shall be delivered to the	931
employer personally or by certified mail and shall remain in	932
effect until the commissioner notifies the employer to the	933
contrary. For purposes of division (D)(3) of this section,	934
"compelling circumstances" exist if either or both of the	935
following are true:	936

(a) Based upon annualization of payments made or required to	937
be made during the preceding calendar year and during the current	938
calendar year, the employer would be required for the next	939
calendar year to make payments under division (B)(2) of this	940
section.	941

(b) Based upon annualization of payments made or required to	942
be made during the current calendar year, the employer would be	943
required for the next calendar year to make payments under	944
division (B)(2) of this section.	945

(E)(1) An employer described in division (B)(1) or (2) of	946
this section shall file, not later than the last day of the month	947
following the end of each calendar quarter, a return covering, but	948
not limited to, both the actual amount deducted and withheld and	949
the amount required to be deducted and withheld for the tax	950
imposed under section 5747.02 of the Revised Code during each	951
partial weekly withholding period or portion of a partial weekly	952
withholding period during that quarter. The employer shall file	953
the quarterly return even if the aggregate amount required to be	954
deducted and withheld for the quarter is zero dollars. At the time	955
of filing the return, the employer shall pay any amounts of	956
undeposited taxes for the quarter, whether actually deducted and	957
withheld or required to be deducted and withheld, that have not	958
been previously paid. If required under division (I) of this	959
section, the payment shall be made by electronic funds transfer.	960
The tax commissioner shall prescribe the form and other	961
requirements of the quarterly return.	962

(2) In addition to other returns required to be filed and	963
payments required to be made under this section, every employer	964
required to deduct and withhold taxes shall file, not later than	965
the thirty-first day of January of each year, an annual return	966
covering, but not limited to, both the aggregate amount deducted	967
and withheld and the aggregate amount required to be deducted and	968
withheld during the entire preceding year for the tax imposed	969
under section 5747.02 of the Revised Code and for each tax imposed	970
under Chapter 5748. of the Revised Code. At the time of filing	971
that return, the employer shall pay over any amounts of	972
undeposited taxes for the preceding year, whether actually	973
deducted and withheld or required to be deducted and withheld,	974
that have not been previously paid. The employer shall make the	975
annual report, to each employee and to the tax commissioner, of	976
the compensation paid and each tax withheld, as the commissioner	977
by rule may prescribe.	978

Each employer required to deduct and withhold any tax is	979
liable for the payment of that amount required to be deducted and	980
withheld, whether or not the tax has in fact been withheld, unless	981
the failure to withhold was based upon the employer's good faith	982
in reliance upon the statement of the employee as to liability,	983
and the amount shall be deemed to be a special fund in trust for	984
the general revenue fund.	985

(F) Each employer shall file with the employer's annual	986
return the following items of information on employees for whom	987
withholding is required under section 5747.06 of the Revised Code:	988

(1) The full name of each employee, the employee's address,	989
the employee's school district of residence, and in the case of a	990
nonresident employee, the employee's principal county of	991
employment;	992

(2) The social security number of each employee;

993

(3) The total amount of compensation paid before any	994
deductions to each employee for the period for which the annual	995
return is made;	996

(4) The amount of the tax imposed by section 5747.02 of the	997
Revised Code and the amount of each tax imposed under Chapter	998
5748. of the Revised Code withheld from the compensation of the	999
employee for the period for which the annual return is made. The	1000
commissioner may extend upon good cause the period for filing any	1001
notice or return required to be filed under this section and may	1002
adopt rules relating to extensions of time. If the extension	1003
results in an extension of time for the payment of the amounts	1004
withheld with respect to which the return is filed, the employer	1005
shall pay, at the time the amount withheld is paid, an amount of	1006
interest computed at the rate per annum prescribed by section	1007
5703.47 of the Revised Code on that amount withheld, from the day	1008
that amount was originally required to be paid to the day of	1009
actual payment or to the day an assessment is issued under section	1010
5747.13 of the Revised Code, whichever occurs first.	1011

(5) In addition to all other interest charges and penalties	1012
imposed, all amounts of taxes withheld or required to be withheld	1013
and remaining unpaid after the day the amounts are required to be	1014
paid shall bear interest from the date prescribed for payment at	1015
the rate per annum prescribed by section 5703.47 of the Revised	1016
Code on the amount unpaid, in addition to the amount withheld,	1017
until paid or until the day an assessment is issued under section	1018
5747.13 of the Revised Code, whichever occurs first.	1019

(G) An employee of a corporation, limited liability company,	1020
or business trust having control or supervision of or charged with	1021
the responsibility of filing the report and making payment, or an	1022
officer, member, manager, or trustee of a corporation, limited	1023
liability company, or business trust who is responsible for the	1024
execution of the corporation's, limited liability company's, or	1025
business trust's fiscal responsibilities, shall be personally	1026
liable for failure to file the report or pay the tax due as	1027
required by this section. The dissolution, termination, or	1028
bankruptcy of a corporation, limited liability company, or	1029
business trust does not discharge a responsible officer's,	1030
member's, manager's, employee's, or trustee's liability for a	1031
failure of the corporation, limited liability company, or business	1032
trust to file returns or pay tax due.	1033

(H) If an employer required to deduct and withhold income tax	1034
from compensation and to pay that tax to the state under sections	1035
5747.06 and 5747.07 of the Revised Code sells the employer's	1036
business or stock of merchandise or quits the employer's business,	1037
the taxes required to be deducted and withheld and paid to the	1038
state pursuant to those sections prior to that time, together with	1039
any interest and penalties imposed on those taxes, become due and	1040
payable immediately, and that person shall make a final return	1041
within fifteen days after the date of selling or quitting	1042
business. The employer's successor shall withhold a sufficient	1043
amount of the purchase money to cover the amount of the taxes,	1044
interest, and penalties due and unpaid, until the former owner	1045
produces a receipt from the tax commissioner showing that the	1046
taxes, interest, and penalties have been paid or a certificate	1047
indicating that no such taxes are due. If the purchaser of the	1048
business or stock of merchandise fails to withhold purchase money,	1049
the purchaser shall be personally liable for the payment of the	1050
taxes, interest, and penalties accrued and unpaid during the	1051
operation of the business by the former owner. If the amount of	1052
taxes, interest, and penalties outstanding at the time of the	1053
purchase exceeds the total purchase money, the tax commissioner in	1054
the commissioner's discretion may adjust the liability of the	1055
seller or the responsibility of the purchaser to pay that	1056
liability to maximize the collection of withholding tax revenue.	1057

(I)(1) An employer described in division (I)(2) of this	1058
section shall make all payments required by this section for the	1059
year by electronic funds transfer under section 5747.072 of the	1060
Revised Code.	1061

(2)(a) For 1994, an employer described in division (I)(2) of	1062
this section is one whose actual or required payments under this	1063
section exceeded five hundred thousand dollars during the	1064
twelve-month period ending June 30, 1993.	1065

(b) For 1995, an employer described in division (I)(2) of	1066
this section is one whose actual or required payments under this	1067
section exceeded five hundred thousand dollars during the	1068
twelve-month period ending June 30, 1994.	1069

(c) For 1996, an employer described in division (I)(2) of	1070
this section is one whose actual or required payments under this	1071
section exceeded three hundred thousand dollars during the	1072
twelve-month period ending June 30, 1995.	1073

(d) For 1997 through 2000, an employer described in division	1074
(I)(2) of this section is one whose actual or required payments	1075
under this section exceeded one hundred eighty thousand dollars	1076
during the twelve-month period ending on the thirtieth day of June	1077
of the preceding calendar year.	1078

(e) For 2001 and thereafter, an employer described in	1079
division (I)(2) of this section is one whose actual or required	1080
payments under this section exceeded eighty-four thousand dollars	1081
during the twelve-month period ending on the thirtieth day of June	1082
of the preceding calendar year.	1083

(J)(1) Every professional employer organization and every	1084
professional employer organization reporting entity shall file a	1085
report with the tax commissioner within thirty days after	1086
commencing business in this state or within thirty days after the	1087
effective date of this amendment, whichever is later, that	1088
includes all of the following information:	1089

(a) The name, address, number the employer receives from the	1090
secretary of state to do business in this state, if applicable,	1091
and federal employer identification number of each client employer	1092
of the professional employer organization or professional employer	1093
organization reporting entity;	1094

(b) The date that each client employer became a client of the	1095
professional employer organization or professional employer	1096
organization reporting entity;	1097

(c) The names and mailing addresses of the chief executive	1098
officer and the chief financial officer of each client employer	1099
for taxation of the client employer.	1100

(2) Beginning with the calendar quarter ending after a	1101
professional employer organization or professional employer	1102
organization reporting entity files the report required under	1103
division (J)(1) of this section, and every calendar quarter	1104
thereafter, the professional employer organization or the	1105
professional employer organization reporting entity shall file an	1106
updated report with the tax commissioner. The professional	1107
employer organization or professional employer organization	1108
reporting entity shall file the updated report not later than the	1109
last day of the month following the end of the calendar quarter	1110
and shall include all of the following information in the report:	1111

(a) If an entity became a client employer of the professional	1112
employer organization or professional employer organization	1113
reporting entity at any time during the calendar quarter, all of	1114
the information required under division (J)(1) of this section for	1115
each new client employer;	1116

(b) If an entity terminated the professional employer	1117
organization agreement between the professional employer	1118
organization or professional employer organization reporting	1119
entity and the entity at any time during the calendar quarter, the	1120
information described in division (J)(1)(a) of this section for	1121
that entity, the date during the calendar quarter that the entity	1122
ceased being a client of the professional employer organization or	1123
professional employer organization reporting entity, if	1124
applicable, or the date the entity ceased business operations in	1125
this state, if applicable;	1126

(c) If the name or mailing address of the chief executive	1127
officer or the chief financial officer of a client employer has	1128
changed since the professional employer organization or	1129
professional employer organization reporting entity previously	1130
submitted a report under division (J)(1) or (2) of this section,	1131
the updated name or mailing address, or both, of the chief	1132
executive officer or the chief financial officer, as applicable;	1133

(d) If none of the events described in divisions (J)(2)(a) to	1134
(c) of this section occurred during the calendar quarter, a	1135
statement of that fact.	1136

Section 2. That existing sections 4123.291, 4125.01, 4125.02,	1137
4125.03, 4125.05, 4125.07, 4125.08, 4141.24, and 5747.07 of the	1138
Revised Code are hereby repealed.	1139

Section 3. Section 4125.05 of the Revised Code as amended by	1140
this act and section 4125.051 of the Revised Code as enacted by	1141
this act take effect January 1, 2011.	1142