NY Lab L § 922 (2021)
2021 New York Laws LAB - Labor Article 31 - New York Professional Employer Act 922 - General Requirements and Provisions.

§ 922. General requirements and provisions. 1. A professional employer organization shall meet the following standards:  (a)  Have a written professional employer agreement between the client and  the  professional   employer   organization   setting   forth   the responsibilities  and  duties  of  each party. The professional employer agreement shall contain a description of the  type  of  services  to  be rendered  by  the  professional employer organization and the respective rights and obligations of the  parties  and  the  professional  employer agreement   shall   also   provide   that   the   professional  employer organization:  (i) reserves a right  of  direction  and  control  over  the  worksite employees. However, the client shall maintain such direction and control over  the  worksite  employees  as  is necessary to conduct the client's business and without which the client would be  unable  to  conduct  its business,  discharge  any fiduciary responsibility which it may have, or comply with any applicable licensure;  (ii) assumes responsibility for  the  withholding  and  remittance  of payroll-related  taxes  and employee benefits for worksite employees and for which  the  professional  employer  organization  has  contractually assumed   responsibility   from   its  own  accounts,  as  long  as  the professional employer agreement  between  the  client  and  professional employer organization remains in force; and  (iii) retains authority to hire, terminate and discipline the worksite employees.  (b)  Provide  written notice of the general nature of the relationship between the professional employer organization and  the  client  to  the worksite employees located at the client worksite.   2.  A  professional  employer  organization  shall  be  considered  an employer for the  purposes  of  withholding  state  income  tax  of  the worksite  employees  pursuant  to section six hundred seventy-one of the tax law.   3. As long as the professional  employer  organization's  professional employer  agreement  with  a  client  remains in force, the professional employer organization shall  have  a  right  to  and  shall  assume  the following responsibilities:  (a)  pay  wages  and collect, report and remit employment taxes of its worksite employees from its own accounts;  (b)  pay  unemployment  insurance  as  required  by  the  unemployment insurance law;  (c) secure and provide required workers' compensation coverage for its worksite employees either in its own name or in its client's name.   4. Both the client and the professional employer organization shall be considered  the  employer for the purpose of coverage under the workers' compensation law and both the professional employer organization and its client shall be entitled to protection of the exclusive remedy provision of the workers' compensation law irrespective of  which  entity  secures and provides such workers' compensation coverage.   5. A registered professional employer organization shall be deemed for purposes  of  state  law  an employer for purposes of sponsoring welfare benefit  plans  for   its   worksite   employees.   Worksite   employees participating in that professional employer organization's fully insured welfare   benefit   plan   or   plans   shall  be  considered  employees participating in a single employer welfare  benefit  plan  or  plans.  A fully  insured  welfare  benefit  plan  or plans offered by a registered professional employer organization  to  its  employees  and/or  worksite employees  shall  not be considered for purposes of state law a multiple employer welfare arrangement.    6. Subject  to  any  contrary  provisions  contained  in  the  written professional  employer agreement between the client and the professional employer organization, the professional employer arrangement that exists between a professional employer organization and its client  or  clients shall  be  interpreted  for  the  purposes  of  insurance and bonding as follows:  (a) Nothing in this section  shall  serve  to  limit  any  contractual liability,  as  may  be  expressly agreed upon, between the professional employer organization and the client, nor shall this section in any  way limit  the  liabilities  of  any  professional  employer organization or client as defined elsewhere in this article; and  (b) Worksite employees are not automatically deemed pursuant  to  this section  to  be  employees of the professional employer organization for purposes of general liability, insurance, automobile insurance, fidelity bonds, surety bonds,  employer's  liability  which  is  not  covered  by workers'  compensation,  or  liquor  liability  insurance carried by the professional employer organization unless  the  worksite  employees  are included  by  specific  reference in the professional employer agreement and applicable prearranged employment contract,  insurance  contract  or bond.   7.  The sale of professional employer services in conformance with the provisions of this article shall not constitute the  sale  of  insurance for  purposes  of  the  insurance law. However, no professional employer organization shall function or hold itself out as an insurer,  insurance broker or insurance agent unless appropriately licensed by this state.   8. Worksite employees whose services are subject to sales tax shall be deemed  the  employees  of  the  client  for  purposes of collecting and levying sales tax on the services performed by the worksite employee.