Professional Employer Organizations

In addition to our expertise in surety bonds, the principals of Alpha Surety & Insurance Brokerage, LLC 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 20 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. Also, at least 14 states 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

ASIB 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.

ESAC Program

The Employer Services Assurance Corporation (www.ESACorp.org) was founded by NAPEO in 1994 to establish financial, operational and ethical standards for the PEO industry and to provide an independently administered program of accreditation and financial assurance for qualified PEOs. The program is designed to provide PEO client companies, state and federal regulators, and key industry vendors with assurance that PEOs accredited by ESAC are able to meet their financial obligations. Beginning in 2000 the Principals of ASIB were able to help ESAC secure millions of dollars of surety bonds held in trust by a national bank to guarantee the financial performance of ESAC-accredited PEOs. Today, ESAC-accredited PEOs serve clients and employees representing over $14 billion in annual wages. Several states have either already accepted or are considering accepting ESAC accreditation and bonding in lieu of their own state requirements. ESAC-accredited PEOs also enjoy preferred pricing from ASIB's surety carriers on all state and federal regulatory bonds.