As Reported by the House Commerce and Labor Committee

129th General Assembly Regular Session 2011-2012

Sub. S. B. No. 139

Senator Hughes 

Cosponsors: Senators Schaffer, Seitz, Patton, Bacon, Beagle, Daniels, Faber, Hite, Jones, Niehaus, Obhof, Tavares 

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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) "Assurance organization" means an independent and	60
qualified entity approved by the administrator of workers'	61
compensation to certify the qualifications of a professional	62
employer organization or professional employer organization	63
reporting entity.	64

(B) "Client employer" means a sole proprietor, partnership,	65
association, limited liability company, or corporation that enters	66
into a professional employer organization agreement and is	67
assigned shared employees by the professional employer	68
organization.	69

(B)(C) "Coemploy" means the sharing of the responsibilities	70
and liabilities of being an employer.	71

(C)(D) "Professional employer organization" means a sole	72
proprietor, partnership, association, limited liability company,	73
or corporation that enters into an agreement with one or more	74
client employers for the purpose of coemploying all or part of the	75
client employer's workforce at the client employer's work site.	76

(D)(E) "Professional employer organization agreement" means a	77
written contract to coemploy employees between a professional	78
employer organization and a client employer with a duration of not	79
less than twelve months in accordance with the requirements of	80
this chapter.	81

(E)(F) "Professional employer organization reporting entity"	82
means two or more professional employer organizations that are	83
majority owned or commonly controlled by the same entity, parent,	84
or controlling person and that satisfy reporting entity control	85
rules as defined by the financial accounting standards board and	86
under generally accepted accounting principles.	87

(G) "Shared employee" means an individual intended to be	88
assigned to a client employer on a permanent basis, not as a	89
temporary supplement to the client employer's workforce, who is	90
coemployed by a professional employer organization and a client	91
employer pursuant to a professional employer organization	92
agreement.	93

(F)(H) "Trade secret" has the same meaning as in section	94
1333.61 of the Revised Code.	95

(I) "Working capital" means the excess of current assets over	96
current liabilities as determined by generally accepted accounting	97
principles.	98

Sec. 4125.02. The administrator of the bureau of workers'	99
compensation shall adopt rules in accordance with Chapter 119. of	100
the Revised Code to administer and enforce this chapter, including	101
rules to administer and enforce division (B) of section 4125.03 of	102
the Revised Code.	103

The administrator may adopt rules for the acceptance of	104
electronic filings in accordance with Chapter 1306. of the Revised	105
Code for applications, documents, reports, and other filings	106
required by this chapter.	107

The administrator may allow an independent assurance	108
organization to act on behalf of a professional employer	109
organization or professional employer organization reporting	110
entity in complying with this chapter and any rules adopted under	111
it. The assurance organization shall be approved by the	112
administrator before acting on behalf of the professional employer	113
organization or the professional employer organization reporting	114
entity and shall abide by all standards and procedures established	115
by the administrator for that approval. The administrator may	116
permit a professional employer organization or professional	117
employer organization reporting entity to authorize an assurance	118
organization approved by the administrator to act on behalf of the	119
professional employer organization or professional employer	120
organization reporting entity, and the administrator shall specify	121
certain provisions of this chapter that may be satisfied by an	122
assurance organization acting with that authority. The rules shall	123
also stipulate that the use of an assurance organization by a	124
professional employer organization to comply with this chapter is	125
not required and is strictly voluntary.	126

Sec. 4125.03. (A) The professional employer organization with	127
whom a shared employee is coemployed shall do all of the	128
following:	129

(1) Pay wages associated with a shared employee pursuant to	130
the terms and conditions of compensation in the professional	131
employer organization agreement between the professional employer	132
organization and the client employer;	133

(2) Pay all related payroll taxes associated with a shared	134
employee independent of the terms and conditions contained in the	135
professional employer organization agreement between the	136
professional employer organization and the client employer;	137

(3) Maintain workers' compensation coverage, pay all workers'	138
compensation premiums and manage all workers' compensation claims,	139
filings, and related procedures associated with a shared employee	140
in compliance with Chapters 4121. and 4123. of the Revised Code,	141
except that when shared employees include family farm officers,	142
ordained ministers, or corporate officers of the client employer,	143
payroll reports shall include the entire amount of payroll	144
associated with those persons;	145

(4) Provide written notice to each shared employee it assigns	146
to perform services to a client employer of the relationship	147
between and the responsibilities of the professional employer	148
organization and the client employer;	149

(5) Maintain complete records separately listing the manual	150
classifications of each client employer and the payroll reported	151
to each manual classification for each client employer for each	152
payroll reporting period during the time period covered in the	153
professional employer organization agreement;	154

(6) Maintain a record of workers' compensation claims for	155
each client employer;	156

(7) Make periodic reports, as determined by the administrator	157
of workers' compensation, of client employers and total workforce	158
to the administrator;	159

(8) Report individual client employer payroll, claims, and	160
classification data under a separate and unique subaccount to the	161
administrator;	162

(9) Within fourteen days after receiving notice from the	163
bureau of workers' compensation that a refund or rebate will be	164
applied to workers' compensation premiums, provide a copy of that	165
notice to any client employer to whom that notice is relevant.	166

(B) The professional employer organization with whom a shared	167
employee is coemployed shall provide a list of all of the	168
following information to the client employer upon the written	169
request of the client employer:	170

(1) All workers' compensation claims, premiums, and payroll	171
associated with that client employer;	172

(2) Compensation and benefits paid and reserves established	173
for each claim listed under division (B)(1) of this section;	174

(3) Any other information available to the professional	175
employer organization from the bureau of workers' compensation	176
regarding that client employer.	177

(C)(1) A professional employer organization shall provide the	178
information required under division (B) of this section in writing	179
to the requesting client employer within forty-five days after	180
receiving a written request from the client employer.	181

(2) For purposes of division (C) of this section, a	182
professional employer organization has provided the required	183
information to the client employer when the information is	184
received by the United States postal service or when the	185
information is personally delivered, in writing, directly to the	186
client employer.	187

(D) Except as provided in section 4125.08 of the Revised Code	188
and unless otherwise agreed to in the professional employer	189
organization agreement, the professional employer organization	190
with whom a shared employee is coemployed has a right of direction	191
and control over each shared employee assigned to a client	192
employer's location. However, a client employer shall retain	193
sufficient direction and control over a shared employee as is	194
necessary to do any of the following:	195

(1) Conduct the client employer's business, including	196
training and supervising shared employees;	197

(2) Ensure the quality, adequacy, and safety of the goods or	198
services produced or sold in the client employer's business;	199

(3) Discharge any fiduciary responsibility that the client	200
employer may have;	201

(4) Comply with any applicable licensure, regulatory, or	202
statutory requirement of the client employer.	203

(C) Notwithstanding division (B) of this section, a client	204
employer may retain sufficient direction and control over a shared	205
employee as is necessary to conduct the client employer's business	206
and to discharge any fiduciary responsibility that it may have, or	207
to comply with any applicable licensure, regulatory, or statutory	208
requirement of the client employer	209

(E) Unless otherwise agreed to in the professional employer	210
organization agreement, liability for acts, errors, and omissions	211
shall be determined as follows:	212

(1) A professional employer organization shall not be liable	213
for the acts, errors, and omissions of a client employer or a	214
shared employee when those acts, errors, and omissions occur under	215
the direction and control of the client employer.	216

(2) A client employer shall not be liable for the acts,	217
errors, and omissions of a professional employer organization or a	218
shared employee when those acts, errors, and omissions occur under	219
the direction and control of the professional employer	220
organization.	221

(F) Nothing in divisions (D) and (E) of this section shall be	222
construed to limit any liability or obligation specifically agreed	223
to in the professional employer organization agreement.	224

Sec. 4125.041.  A shared employee under a professional	225
employer organization agreement shall not, solely as a result of	226
being a shared employee, be considered an employee of the	227
professional employer organization for purposes of general	228
liability insurance, fidelity bonds, surety bonds, employer	229
liability not otherwise covered by Chapters 4121. and 4123. of the	230
Revised Code, or liquor liability insurance carried by the	231
professional employer organization, unless the professional	232
employer organization agreement and applicable prearranged	233
employment contract, insurance contract, or bond specifically	234
states otherwise.	235

Sec. 4125.042.  (A) For purposes of determining tax credits	236
and other economic incentives that are provided by this state or	237
any political subdivision and based on employment, shared	238
employees under a professional employer organization agreement	239
shall be considered employees solely of the client employer.	240

(1) A client employer shall be entitled to the benefit of any	241
tax credit, economic incentive, or similar benefit arising as the	242
result of the client employer's employment of shared employees. If	243
the grant or amount of any tax credit, economic incentive, or	244
other benefit is based on number of employees, each client	245
employer shall be treated as employing only those shared employees	246
coemployed by the client employer. Shared employees working for	247
other client employers of the professional employer organization	248
shall not be counted as employees for that purpose.	249

(2) Upon request by a client employer or an agency or	250
department of this state, a professional employer organization	251
shall provide employment information reasonably required by the	252
agency or department responsible for administration of the tax	253
credit or economic incentive and necessary to support any request,	254
claim, application, or other action by a client employer seeking	255
the tax credit or economic incentive.	256

(B) Shared employees whose services are subject to sales tax	257
shall be considered the employees of the client employer for	258
purposes of collecting and levying sales tax on the services	259
performed by the shared employee. Nothing contained in this	260
chapter shall relieve a client employer or professional employer	261
organization of any sales tax liability with respect to its goods	262
or services.	263

(C) Any tax assessed on a per capita or per employee basis	264
shall be assessed against the client employer for shared employees	265
and against the professional employer organization for employees	266
of the professional employer organization who are not shared	267
employees coemployed with a client employer.	268

(D) For purposes of computing any tax that is imposed or	269
calculated upon the basis of total payroll, the professional	270
employer organization shall be eligible to use any small business	271
allowance or exemption based solely on the employees of the	272
professional employer organization who are not shared employees	273
with any client employer. The eligibility of a client employer for	274
the allowance or exemption shall be based solely upon the payroll	275
of the employees of the client employer, including any shared	276
employees coemployed by the client employer.	277

Sec. 4125.05. (A) Not later than thirty days after November	278
5, 2004, or not later than thirty days after the formation of a	279
professional employer organization, whichever date occurs later, a	280
professional employer organization operating in this state shall	281
register with the administrator of the bureau of workers'	282
compensation on forms provided by the administrator. Following	283
initial registration, each professional employer organization	284
shall register with the administrator annually on or before the	285
thirty-first day of December. Commonly owned or controlled	286
applicants may register as a professional employer organization	287
reporting entity or register individually. Registration as a part	288
of a professional employer organization reporting entity shall not	289
disqualify an individual professional employer organization from	290
participating in a group-rated plan under division (A)(4) of	291
section 4123.29 of the Revised Code.	292

(B) Initial registration and each annual registration renewal	293
shall include all of the following:	294

(1) A list of each of the professional employer	295
organization's client employers current as of the date of	296
registration for purposes of initial registration or current as of	297
the date of annual registration renewal, or within fourteen days	298
of adding or releasing a client, that includes the client	299
employer's name, address, federal tax identification number, and	300
bureau of workers' compensation risk number;	301

(2) A fee as determined by the administrator;

302

(3) The name or names under which the professional employer	303
organization conducts business;	304

(4) The address of the professional employer organization's	305
principal place of business and the address of each office it	306
maintains in this state;	307

(5) The professional employer organization's taxpayer or	308
employer identification number;	309

(6) A list of each state in which the professional employer	310
organization has operated in the preceding five years, and the	311
name, corresponding with each state, under which the professional	312
employer organization operated in each state, including any	313
alternative names, names of predecessors, and if known, successor	314
business entities;	315

(7) The most recent financial statement prepared and audited	316
pursuant to division (B) of section 4125.051 of the Revised Code;	317

(8) If there is any deficit in the working capital required	318
under division (A) of section 4125.051 of the Revised Code, a	319
bond, irrevocable letter of credit, or securities with a minimum	320
market value in an amount sufficient to cover the deficit in	321
accordance with the requirements of that section;	322

(9) An attestation of the accuracy of the data submissions	323
from the chief executive officer of the professional employer	324
organization.	325

(C) Upon terms and for periods that the administrator	326
considers appropriate, the administrator may issue a limited	327
registration to a professional employer organization or	328
professional employer organization reporting entity that provides	329
all of the following items:	330

(1) A properly executed request for limited registration on a	331
form provided by the administrator;	332

(2) All information and materials required for registration	333
in divisions (B)(1) to (6) of this section;	334

(3) Information and documentation necessary to show that the	335
professional employer organization or professional employer	336
organization reporting entity satisfies all of the following	337
criteria:	338

(a) It is domiciled outside of this state.

339

(b) It is licensed or registered as a professional employer	340
organization in another state.	341

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

342

(d) It does not participate in direct solicitations for	343
client employers located or domiciled in this state.	344

(e) It has fifty or fewer shared employees employed or	345
domiciled in this state on any given day.	346

(D)(1) The administrator, with the advice and consent of the	347
bureau of workers' compensation board of directors, shall adopt	348
rules in accordance with Chapter 119. of the Revised Code to	349
require, in addition to the requirement under division (B)(8) of	350
this section and except as otherwise specified in division	351
(C)(D)(2) of this section, a professional employer organization to	352
provide security in the form of a bond or letter of credit	353
assignable to the Ohio bureau of workers' compensation not to	354
exceed an amount equal to the premiums and assessments incurred	355
for the two most recent payroll periods, prior to any discounts or	356
dividends, to meet the financial obligations of the professional	357
employer organization pursuant to this chapter and Chapters 4121.	358
and 4123. of the Revised Code.	359

(2) As an alternative to providing security in the form of a	360
bond or letter of credit under division (D)(1) of this section,	361
the administrator shall permit a professional employer	362
organization to make periodic payments of prospective premiums and	363
assessments to the bureau or to submit proof of being certified by	364
either a nationally recognized organization that certifies	365
professional employer organizations or by a government entity	366
approved by the administrator.	367

(3) A professional employer organization may appeal the	368
amount of the security required pursuant to rules adopted under	369
division (C)(D)(1) of this section in accordance with section	370
4123.291 of the Revised Code.	371

(D)(E) Notwithstanding division (C)(D) of this section, a	372
professional employer organization that qualifies for	373
self-insurance or retrospective rating under section 4123.29 or	374
4123.35 of the Revised Code shall abide by the financial	375
disclosure and security requirements pursuant to those sections	376
and the rules adopted under those sections in place of the	377
requirements specified in division (C)(D) of this section or	378
specified in rules adopted pursuant to that division.	379

(E)(F) Except to the extent necessary for the administrator	380
to administer the statutory duties of the administrator and for	381
employees of the state to perform their official duties, all	382
records, reports, client lists, and other information obtained	383
from a professional employer organization and professional	384
employer organization reporting entity under divisions (A), (B),	385
and (B)(C) of this section are confidential and shall be	386
considered trade secrets and shall not be published or open to	387
public inspection.	388

(F)(G) The list described in division (B)(1) of this section	389
shall be considered a trade secret.	390

(G)(H) The administrator shall establish the fee described in	391
division (B)(2) of this section in an amount that does not exceed	392
the cost of the administration of the initial and renewal	393
registration process.	394

(I) A financial statement required under division (B)(7) of	395
this section for initial registration shall be the most recent	396
financial statement of the professional employer organization or	397
professional employer organization reporting entity of which the	398
professional employer organization is a member and shall not be	399
older than thirteen months. For each registration renewal, the	400
professional employer organization shall file the required	401
financial statement within one hundred eighty days after the end	402
of the professional employer organization's or professional	403
employer organization reporting entity's fiscal year. A	404
professional employer organization may apply to the administrator	405
for an extension beyond that time if the professional employer	406
organization provides the administrator with a letter from the	407
professional employer organization's auditor stating the reason	408
for delay and the anticipated completion date.	409

(J) Multiple, unrelated professional employer organizations	410
shall not combine together for purposes of obtaining workers'	411
compensation coverage or for forming any type of self-insurance	412
arrangement available under this chapter. Multiple, unrelated	413
professional employer organization reporting entities shall not	414
combine together for purposes of obtaining workers' compensation	415
coverage or for forming any type of self-insurance arrangement	416
available under this chapter.	417

(K) The administrator shall maintain a list of professional	418
employer organizations and professional employer organization	419
reporting entities registered under this section that is readily	420
available to the public by electronic or other means.	421

Sec. 4125.051. (A) A professional employer organization, or a	422
professional employer organization reporting entity of which the	423
professional employer organization is a member, shall maintain	424
positive working capital at initial or annual registration, as	425
reflected in the financial statements submitted to the bureau. If	426
a deficit in working capital is reflected in the financial	427
statements submitted to the bureau, the professional employer	428
organization or the professional employer organization reporting	429
entity shall do both of the following for that registration	430
period:	431

(1) Obtain a bond, irrevocable letter of credit, or	432
securities with a minimum market value in an amount sufficient to	433
cover the deficit in working capital;	434

(2) Submit to the administrator of workers' compensation a	435
quarterly financial statement for each calendar quarter during	436
which there is a deficit in working capital, accompanied by an	437
attestation of the chief executive officer of the professional	438
employer organization that all wages, taxes, workers' compensation	439
premiums, and employee benefits have been paid by the professional	440
employer organization or members of the professional employer	441
organization reporting entity.	442

The bond, letter of credit, or securities required under	443
division (A)(1) of this section shall be held by a depository	444
designated by the administrator and shall secure payment by the	445
professional employer organization or professional employer	446
organization reporting entity of all taxes, wages, benefits, or	447
other entitlements due or otherwise pertaining to shared	448
employees, if the professional employer organization or	449
professional employer organization reporting entity does not make	450
those payments when due.	451

(B) A professional employer organization, or a professional	452
employer organization reporting entity of which the professional	453
employer organization is a member, shall prepare financial	454
statements in accordance with generally accepted accounting	455
principles and submit them for registration and registration	456
renewal under section 4125.05 of the Revised Code.	457

The financial statements shall be audited by an independent	458
certified public accountant authorized to practice in the	459
jurisdiction in which that accountant is located.	460

(1) The resulting report of the auditor shall not include	461
either of the following:	462

(a) A qualification or disclaimer of opinion as to adherence	463
to generally accepted accounting principles;	464

(b) A statement expressing substantial doubt about the	465
ability of the professional employer organization or professional	466
employer organization reporting entity to continue as a going	467
concern.	468

(2) However, if a professional employer organization does not	469
have at least twelve months of operating history on which to base	470
financial statements, the financial statements shall be reviewed	471
by a certified public accountant.	472

(3) Notwithstanding division (B)(1)(a) of this section, if a	473
professional employer organization or professional employer	474
organization reporting entity is a subsidiary or is related to a	475
variable interest entity, the professional employer organization	476
or professional employer organization entity may submit financial	477
statements of the professional employer organization or	478
professional employer organization reporting entity.	479

(C) The bureau shall deny initial or annual registration to	480
an applicant or professional employer organization reporting	481
entity that does not meet the requirements of this section.	482

(D) Professional employer organizations in a professional	483
employer organization reporting entity may satisfy the	484
requirements of this section on a combined or consolidated basis	485
provided that each member of the professional employer	486
organization reporting entity guarantees each other members'	487
satisfaction of the requirements under division (A) of this	488
section.	489

For purposes of satisfying the registration and registration	490
renewal requirements described in division (B)(7) of section	491
4125.05 of the Revised Code, a professional employer organization	492
reporting entity may submit a combined or consolidated financial	493
statement that satisfies the requirements of this section. If the	494
combined or consolidated financial statement includes entities	495
that are not professional employer organizations or that are not	496
in the professional employer organization reporting entity, the	497
controlling entity of the professional employer organization	498
reporting entity that is submitting the consolidated or combined	499
financial statement shall guarantee that the professional employer	500
organizations of the professional employer organization reporting	501
entity have satisfied the requirements under division (A) of this	502
section and shall include supplemental combining schedules to	503
guarantee that the requirements under division (A) of this section	504
are satisfied by the professional employer organization or	505
professional employer organization reporting entity.	506

Sec. 4125.07. Not later than fourteen calendar days after the	507
date on which a professional employer organization agreement is	508
terminated, the professional employer organization is adjudged	509
bankrupt, the professional employer organization ceases operations	510
within the state of Ohio, or the registration of the professional	511
employer organization is revoked, the professional employer	512
organization shall submit to the administrator of the bureau of	513
workers' compensation and each client employer associated with	514
that professional employer organization a completed workers'	515
compensation lease termination notice form provided by the	516
administrator. The completed form shall include all client payroll	517
and claim information listed in a format specified by the	518
administrator and notice of all workers' compensation claims that	519
have been reported to the professional employer organization in	520
accordance with its internal reporting policies.	521

A professional employer organization shall report any	522
transfer of employees between related professional employer	523
organization entities or professional employer organization	524
reporting entities to the administrator within fourteen calendar	525
days after the date of the transfer on a form prescribed by the	526
administrator. The professional employer organization or	527
professional employer organization reporting entity shall include	528
in the form all client payroll and claim information regarding the	529
transferred employees listed in a format specified by the	530
administrator and a notice of all workers' compensation claims	531
that have been reported to the professional employer organization	532
or professional employer organization reporting entity in	533
accordance with the internal reporting policies of the	534
professional employer organization or professional employer	535
organization reporting entity.	536

Sec. 4125.08. Nothing in this chapter exempts a professional	537
employer organization, client employer, or shared employee from	538
any applicable federal, state, or local licensing, registration,	539
or certification statutes or regulations. An individual required	540
to obtain and maintain a license, registration, or certification	541
under law and who is a shared employee of a professional employer	542
organization and a client employer is an employee of the client	543
employer for purposes of obtaining and maintaining the appropriate	544
license, registration, or certification as required by law. A	545
professional employer organization does not engage in any	546
occupation, trade, or profession that requires a license,	547
certification, or registration solely by entering into a	548
professional employer agreement with a client employer or	549
coemploying a shared employee.	550

A client employer shall have the sole right of direction and	551
control of the professional or licensed activities of shared	552
employees and of the client employer's business. The shared	553
employees and client employers shall remain subject to regulation	554
by the board, commission, or agency responsible for licensing,	555
registration, or certification of the shared employees or client	556
employers.	557

Sec. 4125.10.  Nothing contained in this chapter or in any	558
professional employer organization agreement shall do any of the	559
following:	560

(A) Diminish, abolish, or remove the rights and obligations	561
of client employers and shared employees existing prior to the	562
effective date of the professional employer organization	563
agreement;	564

(B) Affect, modify, or amend any contractual relationship or	565
restrictive covenant between a shared employee and any client	566
employer in effect at the time a professional employer	567
organization agreement becomes effective;	568

(C) Prohibit or amend any contractual relationship or	569
restrictive covenant between a client employer and a shared	570
employee that is entered into after the professional employer	571
organization agreement becomes effective;	572

(D) Create any new or additional enforcement right of a	573
shared employee against a professional employer organization that	574
is not specifically provided by the professional employer	575
organization agreement or this chapter.	576

A professional employer organization shall have no	577
responsibility or liability in connection with, or arising out of,	578
any contractual relationship or restrictive covenant between a	579
client employer and a shared employee unless the professional	580
employer organization has specifically agreed otherwise in	581
writing.	582

Sec. 4125.11.  For purposes of a bid, contract, purchase	583
order, or agreement entered into with the state or any political	584
subdivision, a client employer's status or certification as a	585
small, minority-owned, disadvantaged, or woman-owned business	586
enterprise or as a historically underutilized business shall not	587
be affected as a result of the client employer entering into a	588
professional employer organization agreement or using the services	589
of a professional employer organization.	590

Sec. 4141.24.  (A)(1) The director of job and family services	591
shall maintain a separate account for each employer and, except as	592
otherwise provided in division (B) of section 4141.25 of the	593
Revised Code respecting mutualized contributions, shall credit	594
such employer's account with all the contributions, or payments in	595
lieu of contributions, which the employer has paid on the	596
employer's own behalf.	597

(2) If, as of the computation date, a contributory employer's	598
account shows a negative balance computed as provided in division	599
(A)(3) of section 4141.25 of the Revised Code, less any	600
contributions due and unpaid on such date, which negative balance	601
is in excess of the limitations imposed by divisions (A)(2)(a),	602
(b), and (c) of this section and if the employer's account is	603
otherwise eligible for the transfer, then before the employer's	604
contribution rate is computed for the next succeeding contribution	605
period, an amount equal to the amount of the excess eligible for	606
transfer shall be permanently transferred from the account of such	607
employer and charged to the mutualized account provided in	608
division (B) of section 4141.25 of the Revised Code.	609

(a) If as of any computation date, a contributory employer's	610
account shows a negative balance in excess of ten per cent of the	611
employer's average annual payroll, then before the employer's	612
contribution rate is computed for the next succeeding contribution	613
period, an amount equal to the amount of the excess shall be	614
transferred from the account as provided in this division. No	615
contributory employer's account may have any excess transferred	616
pursuant to division (A)(2)(a) of this section, unless the	617
employer's account has shown a positive balance for at least two	618
consecutive computation dates prior to the computation date with	619
respect to which the transfer is proposed. Each time a transfer is	620
made pursuant to division (A)(2)(a) of this section, the	621
employer's account is ineligible for any additional transfers	622
under that division, until the account shows a positive balance	623
for at least two consecutive computation dates subsequent to the	624
computation date of which the most recent transfer occurs pursuant	625
to division (A)(2)(a), (b), or (c) of this section.	626

(b) If at the next computation date after the computation	627
date at which a transfer from the account occurs pursuant to	628
division (A)(2)(a) of this section, a contributory employer's	629
account shows a negative balance in excess of fifteen per cent of	630
the employer's average annual payroll, then before the employer's	631
contribution rate is computed for the next succeeding contribution	632
period an amount equal to the amount of the excess shall be	633
permanently transferred from the account as provided in this	634
division.	635

(c) If at the next computation date subsequent to the	636
computation date at which a transfer from a contributory	637
employer's account occurs pursuant to division (A)(2)(b) of this	638
section, the employer's account shows a negative balance in excess	639
of twenty per cent of the employer's average annual payroll, then	640
before the employer's contribution rate is computed for the next	641
succeeding contribution period, an amount equal to the amount of	642
the excess shall be permanently transferred from the account as	643
provided in this division.	644

(d) If no transfer occurs pursuant to division (A)(2)(b) or	645
(c) of this section, the employer's account is ineligible for any	646
additional transfers under division (A)(2) of this section until	647
the account requalifies for a transfer pursuant to division	648
(A)(2)(a) of this section.	649

(B) Any employer may make voluntary payments in addition to	650
the contributions required under this chapter, in accordance with	651
rules established by the director. Such payments shall be included	652
in the employer's account as of the computation date, provided	653
they are received by the director by the thirty-first day of	654
December following such computation date. Such voluntary payment,	655
when accepted from an employer, will not be refunded in whole or	656
in part. In determining whether an employer's account has a	657
positive balance on two consecutive computation dates and is	658
eligible for transfers under division (A)(2) of this section, the	659
director shall exclude any voluntary payments made subsequent to	660
the last transfer made under division (A)(2) of this section.	661

(C) All contributions to the fund shall be pooled and	662
available to pay benefits to any individual entitled to benefits	663
irrespective of the source of such contributions.	664

(D)(1) For the purposes of this section and sections 4141.241	665
and 4141.242 of the Revised Code, an employer's account shall be	666
charged only for benefits based on remuneration paid by such	667
employer. Benefits paid to an eligible individual shall be charged	668
against the account of each employer within the claimant's base	669
period in the proportion to which wages attributable to each	670
employer of the claimant bears to the claimant's total base period	671
wages. Charges to the account of a base period employer with whom	672
the claimant is employed part-time at the time the claimant's	673
application for a determination of benefits rights is filed shall	674
be charged to the mutualized account when all of the following	675
conditions are met:	676

(a) The claimant also worked part-time for the employer	677
during the base period of the claim.	678

(b) The claimant is unemployed due to loss of other	679
employment.	680

(c) The employer is not a reimbursing employer under section	681
4141.241 or 4141.242 of the Revised Code.	682

(2) Notwithstanding division (D)(1) of this section, charges	683
to the account of any employer, including any reimbursing	684
employer, shall be charged to the mutualized account if it finally	685
is determined by a court on appeal that the employer's account is	686
not chargeable for the benefits.	687

(3) Any benefits paid to a claimant under section 4141.28 of	688
the Revised Code prior to a final determination of the claimant's	689
right to the benefits shall be charged to the employer's account	690
as provided in division (D)(1) of this section, provided that if	691
there is no final determination of the claim by the subsequent	692
thirtieth day of June, the employer's account shall be credited	693
with the total amount of benefits that has been paid prior to that	694
date, based on the determination that has not become final. The	695
total amount credited to the employer's account shall be charged	696
to a suspense account, which shall be maintained as a separate	697
bookkeeping account and administered as a part of this section,	698
and shall not be used in determining the account balance of the	699
employer for the purpose of computing the employer's contribution	700
rate under section 4141.25 of the Revised Code.	701

If it is finally determined that the claimant is entitled to	702
all or a part of the benefits in dispute, the suspense account	703
shall be credited and the appropriate employer's account charged	704
with the benefits. If it is finally determined that the claimant	705
is not entitled to all or any portion of the benefits in dispute,	706
the benefits shall be credited to the suspense account and a	707
corresponding charge made to the mutualized account established in	708
division (B) of section 4141.25 of the Revised Code, provided	709
that, except as otherwise provided in this section, if benefits	710
are chargeable to an employer or group of employers who is	711
required or elects to make payments to the fund in lieu of	712
contributions under section 4141.241 of the Revised Code, the	713
benefits shall be charged to the employer's account in the manner	714
provided in division (D)(1) of this section and division (B) of	715
section 4141.241 of the Revised Code, and no part of the benefits	716
may be charged to the suspense account provided in this division.	717

To the extent that benefits that have been paid to a claimant	718
and charged to the employer's account are found not to be due the	719
claimant and are recovered by the director as provided in section	720
4141.35 of the Revised Code, they shall be credited to the	721
employer's account.	722

(4) The director shall notify each employer at least once	723
each month of the benefits charged to the employer's account since	724
the last preceding notice; except that for the purposes of	725
sections 4141.241 and 4141.242 of the Revised Code which provides	726
the billing of employers on a payment in lieu of a contribution	727
basis, the director may prescribe a quarterly or less frequent	728
notice of benefits charged to the employer's account. Such notice	729
will show a summary of the amount of benefits paid which were	730
charged to the employer's account. This notice shall not be deemed	731
a determination of the claimant's eligibility for benefits. Any	732
employer so notified, however, may file within fifteen days after	733
the mailing date of the notice, an exception to charges appearing	734
on the notice on the grounds that such charges are not in	735
accordance with this section. The director shall promptly examine	736
the exception to such charges and shall notify the employer of the	737
director's decision thereon, which decision shall become final	738
unless appealed to the unemployment compensation review commission	739
in the manner provided in section 4141.26 of the Revised Code. For	740
the purposes of this division, an exception is considered timely	741
filed when it has been received as provided in division (D)(1) of	742
section 4141.281 of the Revised Code.	743

(E) The director shall terminate and close the account of any	744
contributory employer who has been subject to this chapter if the	745
enterprise for which the account was established is no longer in	746
operation and it has had no payroll and its account has not been	747
chargeable with benefits for a period of five consecutive years.	748
The amount of any positive balance, computed as provided in	749
division (A)(3) of section 4141.25 of the Revised Code, in an	750
account closed and terminated as provided in this section shall be	751
credited to the mutualized account as provided in division	752
(B)(2)(b) of section 4141.25 of the Revised Code. The amount of	753
any negative balance, computed as provided in division (A)(3) of	754
section 4141.25 of the Revised Code, in an account closed and	755
terminated as provided in this section shall be charged to the	756
mutualized account as provided in division (B)(1)(b) of section	757
4141.25 of the Revised Code. The amount of any positive balance or	758
negative balance, credited or charged to the mutualized account	759
after the termination and closing of an employer's account, shall	760
not thereafter be considered in determining the contribution rate	761
of such employer. The closing of an employer's account as provided	762
in this division shall not relieve such employer from liability	763
for any unpaid contributions or payment in lieu of contributions	764
which are due for periods prior to such closing.	765

If the director finds that a contributory employer's business	766
is closed solely because of the entrance of one or more of the	767
owners, officers, or partners, or the majority stockholder, into	768
the armed forces of the United States, or any of its allies, or of	769
the United Nations after July 1, 1950, such employer's account	770
shall not be terminated and if the business is resumed within two	771
years after the discharge or release of such persons from active	772
duty in the armed forces, the employer's experience shall be	773
deemed to have been continuous throughout such period. The reserve	774
ratio of any such employer shall be the total contributions paid	775
by such employer minus all benefits, including benefits paid to	776
any individual during the period such employer was in the armed	777
forces, based upon wages paid by the employer prior to the	778
employer's entrance into the armed forces divided by the average	779
of the employer's annual payrolls for the three most recent years	780
during the whole of which the employer has been in business.	781

(F) If an employer transfers all of its trade or business to	782
another employer or person, the acquiring employer or person shall	783
be the successor in interest to the transferring employer and	784
shall assume the resources and liabilities of such transferring	785
employer's account, and continue the payment of all contributions,	786
or payments in lieu of contributions, due under this chapter.	787

If an employer or person acquires substantially all, or a	788
clearly segregable and identifiable portion of an employer's trade	789
or business, then upon the director's approval of a properly	790
completed application for successorship, the employer or person	791
acquiring the trade or business, or portion thereof, shall be the	792
successor in interest. The director by rule may prescribe	793
procedures for effecting transfers of experience as provided for	794
in this section.	795

(G) Notwithstanding sections 4141.09, 4141.23, 4141.24,	796
4141.241, 4141.242, 4141.25, 4141.26, and 4141.27 of the Revised	797
Code, both of the following apply regarding assignment of rates	798
and transfers of experience:	799

(1) If an employer transfers its trade or business, or a	800
portion thereof, to another employer and, at the time of the	801
transfer, both employers are under substantially common ownership,	802
management, or control, then the unemployment experience	803
attributable to the transferred trade or business, or portion	804
thereof, shall be transferred to the employer to whom the business	805
is so transferred. The director shall recalculate the rates of	806
both employers and those rates shall be effective immediately upon	807
the date of the transfer of the trade or business.	808

(2) Whenever a person is not an employer under this chapter	809
at the time the person acquires the trade or business of an	810
employer, the unemployment experience of the acquired trade or	811
business shall not be transferred to the person if the director	812
finds that the person acquired the trade or business solely or	813
primarily for the purpose of obtaining a lower rate of	814
contributions. Instead, that person shall be assigned the	815
applicable new employer rate under division (A)(1) of section	816
4141.25 of the Revised Code.	817

(H) The director shall establish procedures to identify the	818
transfer or acquisition of a trade or business for purposes of	819
this section and shall adopt rules prescribing procedures for	820
effecting transfers of experience as described in this section.	821

(I) No rate of contribution less than two and seven-tenths	822
per cent shall be permitted a contributory employer succeeding to	823
the experience of another contributory employer pursuant to this	824
section for any period subsequent to such succession, except in	825
accordance with rules prescribed by the director, which rules	826
shall be consistent with federal requirements for additional	827
credit allowance in section 3303 of the "Internal Revenue Code of	828
1954" and consistent with this chapter, except that such rules may	829
establish a computation date for any such period different from	830
the computation date generally prescribed by this chapter, and may	831
define "calendar year" as meaning a twelve-consecutive-month	832
period ending on the same day of the year as that on which such	833
computation date occurs.	834

(J) The director may prescribe rules for the establishment,	835
maintenance, and dissolution of common contribution rates for two	836
or more contributory employers, and in accordance with such rules	837
and upon application by two or more employers shall establish such	838
common rate to be computed by merging the several contribution	839
rate factors of such employers for the purpose of establishing a	840
common contribution rate applicable to all such employers.	841

(K) The director shall adopt rules applicable to professional	842
employer organizations and professional employer organization	843
reporting entities to address the method in which a professional	844
employer organization or professional employer organization	845
reporting entity reports quarterly wages and contributions to the	846
director for shared employees.	847

(1) The rules shall recognize a professional employer	848
organization or professional employer organization reporting	849
entity as the employer of record of the shared employees of the	850
professional employer organization or professional employer	851
organization reporting entity for reporting purposes; however, the	852
rules shall require that each shared employee of a single client	853
employer be reported under a separate and unique subaccount of the	854
professional employer organization or professional employer	855
organization reporting entity to reflect the experience of the	856
shared employees of that client employer.	857

(2) The director shall use a subaccount solely to determine	858
experience rates for that individual subaccount on an annual basis	859
and shall recognize a professional employer organization or	860
professional employer organization reporting entity as the	861
employer of record associated with each subaccount. The director	862
shall combine the rate experience that existed on a client	863
employer's account prior to entering into a professional employer	864
organization agreement with the experience accumulated as a	865
subaccount of the professional employer organization or	866
professional employer organization reporting entity. The combined	867
experience shall remain with the client account upon termination	868
of the professional employer organization agreement.	869

(3) A professional employer organization or professional	870
employer organization reporting entity shall provide a power of	871
attorney or other evidence, which evidence may be included as part	872
of a professional employer organization agreement, completed by	873
each client employer of the professional employer organization or	874
professional employer organization reporting entity, authorizing	875
the professional employer organization or professional employer	876
organization reporting entity to act on behalf of the client	877
employer in accordance with the requirements of this chapter.	878

(4) Any rule adopted pursuant to division (K) of this section	879
also shall include administrative requirements that permit a	880
professional employer organization or a professional employer	881
organization reporting entity to transmit any reporting and	882
payment data required under division (K)(1) of this section	883
collectively as a single filing with the director.	884

(5) As used in division (K) of this section, "client	885
employer," "professional employer organization," "professional	886
employer organization agreement," "professional employer	887
organization reporting entity," and "shared employee" have the	888
same meanings as in section 4125.01 of the Revised Code.	889

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

890

(1) "Partial weekly withholding period" means a period during	891
which an employer directly, indirectly, or constructively pays	892
compensation to, or credits compensation to the benefit of, an	893
employee, and that consists of a consecutive Saturday, Sunday,	894
Monday, and Tuesday or a consecutive Wednesday, Thursday, and	895
Friday. There are two partial weekly withholding periods each	896
week, except that a partial weekly withholding period cannot	897
extend from one calendar year into the next calendar year; if the	898
first day of January falls on a day other than Saturday or	899
Wednesday, the partial weekly withholding period ends on the	900
thirty-first day of December and there are three partial weekly	901
withholding periods during that week.	902

(2) "Undeposited taxes" means the taxes an employer is	903
required to deduct and withhold from an employee's compensation	904
pursuant to section 5747.06 of the Revised Code that have not been	905
remitted to the tax commissioner pursuant to this section or to	906
the treasurer of state pursuant to section 5747.072 of the Revised	907
Code.	908

(3) A "week" begins on Saturday and concludes at the end of	909
the following Friday.	910

(4) "Client employer," "professional employer organization,"	911
"professional employer organization agreement," and "professional	912
employer organization reporting entity" have the same meanings as	913
in section 4125.01 of the Revised Code.	914

(B) Except as provided in divisions (C) and (D) of this	915
section and in division (A) of section 5747.072 of the Revised	916
Code, every employer required to deduct and withhold any amount	917
under section 5747.06 of the Revised Code shall file a return and	918
shall pay the amount required by law as follows:	919

(1) An employer who accumulates or is required to accumulate	920
undeposited taxes of one hundred thousand dollars or more during a	921
partial weekly withholding period shall make the payment of the	922
undeposited taxes by the close of the first banking day after the	923
day on which the accumulation reaches one hundred thousand	924
dollars. If required under division (I) of this section, the	925
payment shall be made by electronic funds transfer under section	926
5747.072 of the Revised Code.	927

(2)(a) Except as required by division (B)(1) of this section,	928
an employer described in division (B)(2)(b) of this section shall	929
make the payment of undeposited taxes within three banking days	930
after the close of a partial weekly withholding period during	931
which the employer was required to deduct and withhold any amount	932
under this chapter. If required under division (I) of this	933
section, the payment shall be made by electronic funds transfer	934
under section 5747.072 of the Revised Code.	935

(b) For amounts required to be deducted and withheld during	936
1994, an employer described in division (B)(2)(b) of this section	937
is one whose actual or required payments under this section	938
exceeded one hundred eighty thousand dollars during the	939
twelve-month period ending June 30, 1993. For amounts required to	940
be deducted and withheld during 1995 and each year thereafter, an	941
employer described in division (B)(2)(b) of this section is one	942
whose actual or required payments under this section were at least	943
eighty-four thousand dollars during the twelve-month period ending	944
on the thirtieth day of June of the preceding calendar year.	945

(3) Except as required by divisions (B)(1) and (2) of this	946
section, if an employer's actual or required payments were more	947
than two thousand dollars during the twelve-month period ending on	948
the thirtieth day of June of the preceding calendar year, the	949
employer shall make the payment of undeposited taxes for each	950
month during which they were required to be withheld no later than	951
fifteen days following the last day of that month. The employer	952
shall file the return prescribed by the tax commissioner with the	953
payment.	954

(4) Except as required by divisions (B)(1), (2), and (3) of	955
this section, an employer shall make the payment of undeposited	956
taxes for each calendar quarter during which they were required to	957
be withheld no later than the last day of the month following the	958
last day of March, June, September, and December each year. The	959
employer shall file the return prescribed by the tax commissioner	960
with the payment.	961

(C) The return and payment schedules prescribed by divisions	962
(B)(1) and (2) of this section do not apply to the return and	963
payment of undeposited school district income taxes arising from	964
taxes levied pursuant to Chapter 5748. of the Revised Code.	965
Undeposited school district income taxes shall be returned and	966
paid pursuant to divisions (B)(3) and (4) of this section, as	967
applicable.	968

(D)(1) The requirements of division (B) of this section are	969
met if the amount paid is not less than ninety-five per cent of	970
the actual tax withheld or required to be withheld for the prior	971
quarterly, monthly, or partial weekly withholding period, and the	972
underpayment is not due to willful neglect. Any underpayment of	973
withheld tax shall be paid within thirty days of the date on which	974
the withheld tax was due without regard to division (D)(1) of this	975
section. An employer described in division (B)(1) or (2) of this	976
section shall make the payment by electronic funds transfer under	977
section 5747.072 of the Revised Code.	978

(2) If the tax commissioner believes that quarterly or	979
monthly payments would result in a delay that might jeopardize the	980
remittance of withholding payments, the commissioner may order	981
that the payments be made weekly, or more frequently if necessary,	982
and the payments shall be made no later than three banking days	983
following the close of the period for which the jeopardy order is	984
made. An order requiring weekly or more frequent payments shall be	985
delivered to the employer personally or by certified mail and	986
remains in effect until the commissioner notifies the employer to	987
the contrary.	988

(3) If compelling circumstances exist concerning the	989
remittance of undeposited taxes, the commissioner may order the	990
employer to make payments under any of the payment schedules under	991
division (B) of this section. The order shall be delivered to the	992
employer personally or by certified mail and shall remain in	993
effect until the commissioner notifies the employer to the	994
contrary. For purposes of division (D)(3) of this section,	995
"compelling circumstances" exist if either or both of the	996
following are true:	997

(a) Based upon annualization of payments made or required to	998
be made during the preceding calendar year and during the current	999
calendar year, the employer would be required for the next	1000
calendar year to make payments under division (B)(2) of this	1001
section.	1002

(b) Based upon annualization of payments made or required to	1003
be made during the current calendar year, the employer would be	1004
required for the next calendar year to make payments under	1005
division (B)(2) of this section.	1006

(E)(1) An employer described in division (B)(1) or (2) of	1007
this section shall file, not later than the last day of the month	1008
following the end of each calendar quarter, a return covering, but	1009
not limited to, both the actual amount deducted and withheld and	1010
the amount required to be deducted and withheld for the tax	1011
imposed under section 5747.02 of the Revised Code during each	1012
partial weekly withholding period or portion of a partial weekly	1013
withholding period during that quarter. The employer shall file	1014
the quarterly return even if the aggregate amount required to be	1015
deducted and withheld for the quarter is zero dollars. At the time	1016
of filing the return, the employer shall pay any amounts of	1017
undeposited taxes for the quarter, whether actually deducted and	1018
withheld or required to be deducted and withheld, that have not	1019
been previously paid. If required under division (I) of this	1020
section, the payment shall be made by electronic funds transfer.	1021
The tax commissioner shall prescribe the form and other	1022
requirements of the quarterly return.	1023

(2) In addition to other returns required to be filed and	1024
payments required to be made under this section, every employer	1025
required to deduct and withhold taxes shall file, not later than	1026
the thirty-first day of January of each year, an annual return	1027
covering, but not limited to, both the aggregate amount deducted	1028
and withheld and the aggregate amount required to be deducted and	1029
withheld during the entire preceding year for the tax imposed	1030
under section 5747.02 of the Revised Code and for each tax imposed	1031
under Chapter 5748. of the Revised Code. At the time of filing	1032
that return, the employer shall pay over any amounts of	1033
undeposited taxes for the preceding year, whether actually	1034
deducted and withheld or required to be deducted and withheld,	1035
that have not been previously paid. The employer shall make the	1036
annual report, to each employee and to the tax commissioner, of	1037
the compensation paid and each tax withheld, as the commissioner	1038
by rule may prescribe.	1039

Each employer required to deduct and withhold any tax is	1040
liable for the payment of that amount required to be deducted and	1041
withheld, whether or not the tax has in fact been withheld, unless	1042
the failure to withhold was based upon the employer's good faith	1043
in reliance upon the statement of the employee as to liability,	1044
and the amount shall be deemed to be a special fund in trust for	1045
the general revenue fund.	1046

(F) Each employer shall file with the employer's annual	1047
return the following items of information on employees for whom	1048
withholding is required under section 5747.06 of the Revised Code:	1049

(1) The full name of each employee, the employee's address,	1050
the employee's school district of residence, and in the case of a	1051
nonresident employee, the employee's principal county of	1052
employment;	1053

(2) The social security number of each employee;

1054

(3) The total amount of compensation paid before any	1055
deductions to each employee for the period for which the annual	1056
return is made;	1057

(4) The amount of the tax imposed by section 5747.02 of the	1058
Revised Code and the amount of each tax imposed under Chapter	1059
5748. of the Revised Code withheld from the compensation of the	1060
employee for the period for which the annual return is made. The	1061
commissioner may extend upon good cause the period for filing any	1062
notice or return required to be filed under this section and may	1063
adopt rules relating to extensions of time. If the extension	1064
results in an extension of time for the payment of the amounts	1065
withheld with respect to which the return is filed, the employer	1066
shall pay, at the time the amount withheld is paid, an amount of	1067
interest computed at the rate per annum prescribed by section	1068
5703.47 of the Revised Code on that amount withheld, from the day	1069
that amount was originally required to be paid to the day of	1070
actual payment or to the day an assessment is issued under section	1071
5747.13 of the Revised Code, whichever occurs first.	1072

(5) In addition to all other interest charges and penalties	1073
imposed, all amounts of taxes withheld or required to be withheld	1074
and remaining unpaid after the day the amounts are required to be	1075
paid shall bear interest from the date prescribed for payment at	1076
the rate per annum prescribed by section 5703.47 of the Revised	1077
Code on the amount unpaid, in addition to the amount withheld,	1078
until paid or until the day an assessment is issued under section	1079
5747.13 of the Revised Code, whichever occurs first.	1080

(G) An employee of a corporation, limited liability company,	1081
or business trust having control or supervision of or charged with	1082
the responsibility of filing the report and making payment, or an	1083
officer, member, manager, or trustee of a corporation, limited	1084
liability company, or business trust who is responsible for the	1085
execution of the corporation's, limited liability company's, or	1086
business trust's fiscal responsibilities, shall be personally	1087
liable for failure to file the report or pay the tax due as	1088
required by this section. The dissolution, termination, or	1089
bankruptcy of a corporation, limited liability company, or	1090
business trust does not discharge a responsible officer's,	1091
member's, manager's, employee's, or trustee's liability for a	1092
failure of the corporation, limited liability company, or business	1093
trust to file returns or pay tax due.	1094

(H) If an employer required to deduct and withhold income tax	1095
from compensation and to pay that tax to the state under sections	1096
5747.06 and 5747.07 of the Revised Code sells the employer's	1097
business or stock of merchandise or quits the employer's business,	1098
the taxes required to be deducted and withheld and paid to the	1099
state pursuant to those sections prior to that time, together with	1100
any interest and penalties imposed on those taxes, become due and	1101
payable immediately, and that person shall make a final return	1102
within fifteen days after the date of selling or quitting	1103
business. The employer's successor shall withhold a sufficient	1104
amount of the purchase money to cover the amount of the taxes,	1105
interest, and penalties due and unpaid, until the former owner	1106
produces a receipt from the tax commissioner showing that the	1107
taxes, interest, and penalties have been paid or a certificate	1108
indicating that no such taxes are due. If the purchaser of the	1109
business or stock of merchandise fails to withhold purchase money,	1110
the purchaser shall be personally liable for the payment of the	1111
taxes, interest, and penalties accrued and unpaid during the	1112
operation of the business by the former owner. If the amount of	1113
taxes, interest, and penalties outstanding at the time of the	1114
purchase exceeds the total purchase money, the tax commissioner in	1115
the commissioner's discretion may adjust the liability of the	1116
seller or the responsibility of the purchaser to pay that	1117
liability to maximize the collection of withholding tax revenue.	1118

(I)(1) An employer described in division (I)(2) of this	1119
section shall make all payments required by this section for the	1120
year by electronic funds transfer under section 5747.072 of the	1121
Revised Code.	1122

(2)(a) For 1994, an employer described in division (I)(2) of	1123
this section is one whose actual or required payments under this	1124
section exceeded five hundred thousand dollars during the	1125
twelve-month period ending June 30, 1993.	1126

(b) For 1995, an employer described in division (I)(2) of	1127
this section is one whose actual or required payments under this	1128
section exceeded five hundred thousand dollars during the	1129
twelve-month period ending June 30, 1994.	1130

(c) For 1996, an employer described in division (I)(2) of	1131
this section is one whose actual or required payments under this	1132
section exceeded three hundred thousand dollars during the	1133
twelve-month period ending June 30, 1995.	1134

(d) For 1997 through 2000, an employer described in division	1135
(I)(2) of this section is one whose actual or required payments	1136
under this section exceeded one hundred eighty thousand dollars	1137
during the twelve-month period ending on the thirtieth day of June	1138
of the preceding calendar year.	1139

(e) For 2001 and thereafter, an employer described in	1140
division (I)(2) of this section is one whose actual or required	1141
payments under this section exceeded eighty-four thousand dollars	1142
during the twelve-month period ending on the thirtieth day of June	1143
of the preceding calendar year.	1144

(J)(1) Every professional employer organization and every	1145
professional employer organization reporting entity shall file a	1146
report with the tax commissioner within thirty days after	1147
commencing business in this state or within thirty days after the	1148
effective date of this amendment, whichever is later, that	1149
includes all of the following information:	1150

(a) The name, address, number the employer receives from the	1151
secretary of state to do business in this state, if applicable,	1152
and federal employer identification number of each client employer	1153
of the professional employer organization or professional employer	1154
organization reporting entity;	1155

(b) The date that each client employer became a client of the	1156
professional employer organization or professional employer	1157
organization reporting entity;	1158

(c) The names and mailing addresses of the chief executive	1159
officer and the chief financial officer of each client employer	1160
for taxation of the client employer.	1161

(2) Beginning with the calendar quarter ending after a	1162
professional employer organization or professional employer	1163
organization reporting entity files the report required under	1164
division (J)(1) of this section, and every calendar quarter	1165
thereafter, the professional employer organization or the	1166
professional employer organization reporting entity shall file an	1167
updated report with the tax commissioner. The professional	1168
employer organization or professional employer organization	1169
reporting entity shall file the updated report not later than the	1170
last day of the month following the end of the calendar quarter	1171
and shall include all of the following information in the report:	1172

(a) If an entity became a client employer of the professional	1173
employer organization or professional employer organization	1174
reporting entity at any time during the calendar quarter, all of	1175
the information required under division (J)(1) of this section for	1176
each new client employer;	1177

(b) If an entity terminated the professional employer	1178
organization agreement between the professional employer	1179
organization or professional employer organization reporting	1180
entity and the entity at any time during the calendar quarter, the	1181
information described in division (J)(1)(a) of this section for	1182
that entity, the date during the calendar quarter that the entity	1183
ceased being a client of the professional employer organization or	1184
professional employer organization reporting entity, if	1185
applicable, or the date the entity ceased business operations in	1186
this state, if applicable;	1187

(c) If the name or mailing address of the chief executive	1188
officer or the chief financial officer of a client employer has	1189
changed since the professional employer organization or	1190
professional employer organization reporting entity previously	1191
submitted a report under division (J)(1) or (2) of this section,	1192
the updated name or mailing address, or both, of the chief	1193
executive officer or the chief financial officer, as applicable;	1194

(d) If none of the events described in divisions (J)(2)(a) to	1195
(c) of this section occurred during the calendar quarter, a	1196
statement of that fact.	1197

Section 2. That existing sections 4123.291, 4125.01, 4125.02,	1198
4125.03, 4125.05, 4125.07, 4125.08, 4141.24, and 5747.07 of the	1199
Revised Code are hereby repealed.	1200

Section 3. Section 4125.05 of the Revised Code as amended by	1201
this act and section 4125.051 of the Revised Code as enacted by	1202
this act take effect April 1, 2013.	1203