Professional Employer Organizations
In addition to our expertise in surety bonds, the principals of Alpha Surety have extensive experience in the Professional Employer Organization (PEO) industry. This makes us a premier authority for surety bonds within this industry. Below are some useful articles published by one of our Principals.
PEO Financial Assurance Options Update – PEO Insider, November 2003
The Cost of Surety Bonds – PEO Insider, September 2002
State Regulatory Bonds
There are currently over 40 states that require a PEO to be licensed or registered to operate in that state, and many of these states either require a surety bond or allow a surety bond to be posted in lieu of other financial requirements. These license bonds are simply compliance bonds that require adherence to established business procedures or are required in lieu of a specified net worth. Many of these states also require PEOs to post a bond to secure the payment of specific state employer obligations such as unemployment taxes or workers’ compensation premiums.
Federal Bonding Services
Alpha Surety has consulted with federal agencies and national trade associations, such as the IRS and the National Association of Professional Employer Organizations (www.napeo.org), regarding potential regulatory surety bond requirements and the most likely surety industry response.
The Employer Services Assurance Corporation (www.AccessESAC.org) was founded in 1995 to establish standards, verify compliance and provide financial assurance for the PEO industry. ESAC is the gold standard for PEO ethical-financial-operational performance. Through continuous verification of PEO solvency and compliance, ESAC provides PEO clients and regulators the peace of mind that accredited PEOs are meeting their contractual, financial and legal obligations. Since 2000 we have helped ESAC secure millions of dollars of surety bonds to guarantee the performance of accredited PEOs. Today the program covers PEOs serving over 55,000 clients and over 1.4 million employees representing over $86 billion in annual wages. ESAC compliance certification and bonding is now accepted by 17 states in lieu of all or part of state licensing requirements. Accredited PEOs also enjoy preferred pricing from ASIB’s surety carriers on all regulatory bonds, including the new IRS bond.