CHANGES TO EMPLOYEE LEASING LAW
- Financial Requirements. Audited financial statements submitted initially and annually must now show a positive working capital, computed as current assets minus current liabilities. This is amended from the previous provision of a minimum net worth of $100,000.
Employee leasing companies that do not meet the above requirement may submit a bond, irrevocable letter of credit, or securities with a minimum market value equaling the amount necessary to achieve a positive working capital plus up to $100,000 (amount determined by the commissioner). This provision does not apply to an employee leasing company group.
- Limited Registration. This will be available for an employee leasing company that
- Is not domiciled in New Jersey;
- Is licensed or registered as an employee leasing company or professional employer organization in another state;
- Does not maintain an office in New Jersey or directly solicit client companies located or domiciled in this state; and
- Is not responsible for more than 50 covered employees employed in New Jersey.
Employee leasing companies receiving limited registration will not be required to comply with the provisions of subsections a. and b. of Section 5 of P.L. 2001, c.260 regarding submission of financial statements.
- Employee Leasing Company Groups. Two or more employee leasing companies majority owned by the same parent entity may register as an employee leasing company group and meet the financial requirements of the Law on a combined or consolidated basis, provided that the group must demonstrate positive working capital. The initial and annual application forms for employee leasing company groups:
- Assurance Organizations. An assurance organization is an independent and qualified entity approved by the commissioner to certify the qualifications of an employee leasing company or employee leasing company group for registration.