Paychex HR PEO Terms of Service
Version effective 2/15/2023
Part A: Paychex HR PEO Service Description
Functions included in PEO Service. We will provide you our PEO Service which includes:
HR consultation and support on any human resources subject, including employee handbooks and policies and access to HR tools and resources.
Benefits which may include health and welfare, 401(k), and other benefits (additional documentation and approvals are required for each benefit and eligibility, participation, and other criteria may apply).
On-line employment resources.
Payroll including issuing wages, wage statements, and W-2s for the wages we issue. Payroll will be drawn from our accounts and paid under our FEIN. Wages may be issued via check, direct deposit via Automated Clearing House (ACH) or the RTP® network (same day or RTP transactions may incur additional fee). We have control of payment of wages issued from our accounts for purposes of section 3401(d) of the Internal Revenue Code. We may charge a fee per delivery of payroll per location and postage if we mail checks directly to a Covered Employee.
Garnishment/wage deduction order processing including administration and remitting funds. If you receive a garnishment or wage deduction order for a Covered Employee notify the sender to serve us so we can respond; you may still have to respond to documents served on you (we cannot file documents in legal proceedings in your name but we can remit funds on your instruction). You may be required to respond to garnishments or wage deduction orders served on you; we can assist you with the information in our possession and remit funds but we are not permitted by law to respond on your behalf. We may retain fees authorized by law to be charged to subject Covered Employee wages.
Employment taxes including deducting, withholding, remitting, and reporting FICA, FUTA, and SUTA from the payroll we issue.
Unemployment claims services for claims relating to our payroll including claims processing, and charge reconciliation.
Covered Employees. Our Paychex HR PEO Service applies to “Covered Employees.” A Covered Employee is a common law employee of yours (not an independent contractor or someone who has been misclassified as an independent contractor, subcontractor, volunteer, or worker paid through a staffing service or other third party), performing services for you under your direction and control in the United States, that you submit to us to be a Covered Employee under our Agreement while our Paychex HR PEO Service is in effect. You agree to submit all your employees employed in the United States to be Covered Employees. Persons do not become Covered Employees until we have received and accepted all information we require to set them up in our system (to avoid risk of non-Coverage, you should not allow them to work until they have become Covered Employees), including a signed Employee Acknowledgments form. The PEO relationship between you, us, and Covered Employees as described in our Agreement is sometimes referred to for convenience as “co-employment,” however, you and we are independent contractors of each-other, not joint employers, partners, or joint venturers. Employees are only Covered Employees with respect to work that you properly report to us and pay us for, that we issue payroll for, and that is consistent with the workers’ compensation code under which you report them to us (the code must be listed on a pricing exhibit to our Agreement). Any other work is not as a Covered Employee, even if the employee also works as a Covered Employee. You are responsible for everything relating to work that is not as a Covered Employee including wages, taxes, benefits, and workers’ compensation coverage.
Hiring and employment verification. You are responsible to verify Covered Employees’ eligibility to work as required by law and not employ Covered Employees you know not to be eligible to work, to maintain records relating to employment verification, including original I-9s and, if required by law or used by you, E-Verify, showing that you complied with verification and reverification requirements (you will give us copies of and access to these records on our reasonable request including after our Agreement terminates). If a Covered Employee requires a visa, you will be the sponsoring employer. You are responsible for ensuring that Covered Employees are qualified to perform the work they perform for you, including any responsibility to perform background checks or verify or maintain qualifications. For Covered Employees working for you when our Paychex HR PEO Service takes effect, you may either utilize I-9s already obtained by you or you may recertify all Covered Employees within time limits provided by law; we rely on you to have compliant I-9s on file.
Dispute resolution agreements. We may enter into dispute resolution agreements such as arbitration agreements, jury trial waivers, and class action waivers with Covered Employees (for example, in our onboarding documents). You consent to be bound by these agreements with respect to any dispute we or our insurance carriers are involved in. You can agree to other ways of resolving disputes (for example, in contracts with Covered Employees) as long as they do not conflict with our agreements for disputes we or our insurance carriers are involved in.
Self-employed individuals. If on your instructions we process wages for individuals considered self-employed under the Internal Revenue Code as Covered Employees: You will identify them to us as being self-employed; You represent that they meet the definition of Covered Employees; You represent that they are eligible to receive W-2 wages for the services they perform for you as Covered Employees; We may require that you pay them at least a minimum amount of wages through our Paychex HR PEO Service; We are not responsible for reconciling W-2 wages we issue with K-1s or other tax documents, or for any consequences of their receiving W-2 wages. Self-employed individuals are not permitted to participate on a pre-tax basis in benefits we sponsor and may not be eligible for workers’ compensation or unemployment compensation benefits under applicable law regardless of whether we charge fees or withhold/remit based on their wages in connection with workers’ compensation or unemployment compensation as we would other Covered Employees.
Document storage/publication. We may make functionality available that allows you to store, access, or publish documents. We do not approve, review, or control your use of such functionality (though we may have access to it for ministerial purposes); you are responsible for content you provide and the use you make of it.
Policies/handbook. You set policies for Covered Employees (for instance policies that might be included in an employee handbook).
Contracts with Covered Employees. You can enter into contracts with Covered Employees such as employment contracts, confidentiality and noncompetition agreements, and intellectual property agreements. We are not a party to or responsible for your contracts with Covered Employees. We disclaim any interest in the work product of Covered Employees, including intellectual property rights.
Authority. No Covered Employee is authorized to bind us or act on our behalf or in our name. Any Covered Employee acting in an executive, managerial, or supervisory capacity for your business does so on your behalf, not ours.
Employee assignments. You are responsible for hiring, firing, disciplining, supervising, directing, and controlling Covered Employees (notwithstanding any law that requires PEOs to reserve a right to do these things), for Covered Employee acts and omissions, for reporting Covered Employee compensation to us, and for determining who is qualified for work assignments relating to your business.
Benefits you sponsor. If you sponsor benefit plans for Covered Employees: You will obtain our prior consent to offer the plan (this is to ensure that your plan does not interfere with our functions, not, for instance, a legal review); We will not sponsor or be the Plan Administrator of your benefit plans or adopt them; Under no circumstances will we be deemed to act as a plan fiduciary, or in any other way be responsible for your plans. We may at your request note deductions for benefit plans you sponsor on payroll we issue, but except for certain plans serviced by Paychex Retirement Services or written through Paychex Insurance Agency which if applicable will be confirmed separately, we will not handle the money associated with them (no money in our possession will be deemed your plan’s plan asset), we will credit you on invoices and you will be responsible for applying them appropriately under your plan. If you instruct us to reflect employee deductions for a plan of yours on payroll as pre-tax, you represent that they are compliant to take as payroll deductions and/or treat as pre-tax under a Section 125 plan you have established. If we administer your health/welfare plan deductions a $5 per participating employee per month fee will apply (if you administer deductions using our self-service web interface there is no charge). You are responsible for all matters relating to your plans including fiduciary obligations, tax returns, discrimination testing, correcting testing failures, and compliance with applicable laws which might include ERISA, COBRA and state equivalents, and the Affordable Care Act among others. We may reflect the value of health benefits you sponsor on W-2s we issue (you must give us information in the format and within the deadlines we specify). You can have policies and fringe benefits such as paid time off policies for Covered Employees; you are solely responsible for them and we are not obligated to provide any benefit under them, though we may perform ministerial tasks related to our Services that reflect them, for instance on payroll. We may also help you determine and track measurement, stability, and administrative periods and comply with 1094/1095 notice requirements (additional requirements and fees may apply) but we are not responsible for your compliance with regard to such matters. Nothing we do pursuant to our Paychex HR PEO Service will be deemed a service to your plans. We will not make service provider fee disclosures to your plans or enter into HIPAA Business Associate Agreements with respect to your plans.
Section 125 plans. If we provide support services relating to a plan that you sponsor and offer on a pre-tax basis (which if applicable will be confirmed separately) you hereby adopt the form of our standard prototype Section 125 plan document, as we may amend it from time to time (you may request a current copy at any time), as your Section 125 plan document and our services will assume that the prototype document governs. The prototype document is provided as-is without warranty and is not intended as legal or tax advice; by adopting it you ratify it on an ongoing basis as it may be amended from time to time.
Exclusions from “wages.” Unless, and then only to the extent, explicitly required by a law specifically regulating PEOs, any legal obligation we may have to pay Covered Employee wages extends only to the applicable minimum wage and applicable overtime; we do not assume responsibility for payment of wages in excess of applicable minimum wage/overtime, bonuses, commissions, severance pay, deferred compensation, profit sharing, vacation, sick, or other paid time off pay, benefits, or any other payment or compensation obligation, arising from or in connection with a plan, policy, obligation (statutory or otherwise), collective bargaining agreement, or contract of yours, although we may reflect them on payroll we issue to Covered Employees subject to your having provided us the funds to do so as part of your payment obligations. We have not undertaken responsibility to pay for any benefits for Covered Employees.
Equity-based compensation. In accordance with FASB you have the exclusive right to grant stock options to Covered Employees (they are not eligible to participate in any equity-based or incentive compensation or plan of ours) and to determine the economic value of their labor including compensation levels and the number and value of options granted. You will pay any compensation for Covered Employees relating to equity- based compensation that should be reflected on a W-2 through our Covered Employee payroll (they will be subject to legally-required deductions and withholdings). You are responsible for any matter arising out of or relating to any stock option, equity-based, or incentive plan of yours.
Mandated benefits. Unless otherwise explicitly required of PEOs by law, you (not we) will be deemed the employer of Covered Employees for purposes of employer shared responsibility provisions of the Affordable Care Act and any other law requiring an employer to provide a health, welfare, retirement, leave (paid or otherwise), fringe, or other benefit, although you may be able to satisfy such requirements through our Services.
State-mandated disability. To avoid potentially conflicting filings, if you utilize Covered Employees in a state that mandates disability plans you agree not to sponsor a disability plan for Covered Employees without our consent.
Our health and welfare benefit plans. If Covered Employees participate in a health and welfare plan we sponsor:
You are responsible for compliance with requirements of the Affordable Care Act and any similar law which apply at the level of your group including: Determining if you are an applicable large employer; Determining whether to offer coverage and at what level and what participant contributions will be, and paying any penalties or assessments including employer shared responsibility penalties or assessments; Designating new hires that you expect to be full time for eligibility purposes; Advising us of any measurement or stability periods in effect immediately prior to your group’s participation in our plan; Determining whether you are subject to automatic enrollment requirements; Determining whether you are eligible for transition relief; Determining whether you are subject to state or federal COBRA or similar continuation requirements; Determining matters (such as plan years) relating to plans your group participated in prior to our plan; Advising us if you are part of a controlled group or affiliated service group and if so performing nondiscrimination testing with respect to your group; and Any other responsibility not expressly allocated to us under our Agreement.
We are responsible for compliance with requirements of the Affordable Care Act which apply at the level of the plan as a whole including: Reporting the value of coverage under our plan on W-2s issued by us; Providing initial and ongoing exchange notices; Tracking measurement, administrative, and stability periods once your group has begun participating in our health plan; Applying any medical loss ratio (MLR) rebates; Managing eligibility; Administering auto enrollment (if required); Performing nondiscrimination testing (except if you are part of a controlled or affiliated service group with members not using our Paychex HR PEO Service in which case you will be responsible for nondiscrimination testing for the group); and Providing 1094/1095 notices of coverage with respect to our plan for you to sign and file if you are a client of ours on 12/31 of the year following the reporting period and your group participated in our plan during the reporting period. We may need historical data from you to perform some of these functions.
We are the purchaser of insurance for our plan. Our insurance providers may set requirements relating to matters such as group size, participation, and maximum employee contribution levels from time to time; if your group does not meet these requirements it may not qualify to participate in our health plan. If there are insufficient wages from which to deduct participating employee contributions you agree to pay them through termination of coverage (including after our Agreement or Paychex HR PEO Service terminate with respect to the final month of coverage which generally terminates at the end of the calendar month on or after termination). No money provided or fees paid by you will be deemed an employer contribution under our plan. When your group ceases participation in our health plan (which will not be later than the termination of our Paychex HR PEO Service), state and federal COBRA or similar continuation coverage will not be available under our plan to any members of your group (including people on COBRA continuation or eligible to elect it at the time group participation ceases); if you are subject to state or federal COBRA or similar continuation requirements you agree to obtain continuation coverage (whether using a policy issued to you or otherwise, including under another Professional Employer Organization’s plan) and offer it to every person actively on or eligible to elect COBRA or similar continuation.
Payroll tax credits under our EIN. If you request that we file for payroll tax credits on your behalf that are claimed through our tax returns: Though we may assist you, you are solely responsible for determining your eligibility. You warrant your eligibility and the completeness, accuracy, and adequacy of all supporting information including information in our payroll systems. You agree to fully and timely cooperate with us in claiming credits and responding to taxing authority inquiries, investigations, audits, and enforcement actions, and will retain and make available all documentation supporting claiming credits. We have complete discretion as to whether to file for credits (we are not obligated to do so). We make no warranties, including as to whether or when the taxing authority will grant credits. You will unconditionally save, hold harmless, and indemnify us for all matters arising from or in relations to credits. We may require you to provide substantiation, sign additional contractual and other documents, pay fees, and meet deadlines among other things as conditions to our filing for credits. We may deduct any amounts you owe Paychex and any Paychex affiliate from any credits received. We will not advance any credits that have not been provided by the taxing authority. If the taxing authority disallows credits we are not required to appeal and you will immediately remit to us the amount disallowed and any penalties or interest assessed. This paragraph will survive termination of our Agreement.
How our Paychex HR PEO Service relates to your business
Operational decisions. We may discuss operational decisions with you, but you make all operational decisions regarding your business. You are responsible for products and services your organization provides and for the actions and omissions of your organization and its agents.
Regulated businesses. Your customers are not our customers; we will not have access to your information about them or participate in your service to them. If you or a Covered Employee are subject to a licensing, registration, bonding, insuring, or other industry or profession regulation- related requirement we do not participate in or control the regulated activity (for example, if you are a law firm we do not have any involvement in or control over your practice of law). We do not share in commissions or other compensation you receive for regulated activity. If you are a governmental entity or a government contractor we have not been contracted to provide labor pursuant to your government contract or otherwise perform any part of your government contract and we do not become a government contractor or subcontractor or agree to be bound by the rules governing government contractors.
Laws affecting you. You are responsible to comply with laws relating to your control over your business and Covered Employees including applicable laws relating to discrimination, harassment, retaliation, benefits you provide or are required to provide, child labor, wages and hours, wage statement contents, time off and restoration to work, disabilities (including providing reasonable accommodations and engaging in interactive processes), qualification to work in the United States, licensing, registration, bonding, and similar requirements applicable to your business and employees, privacy (including biometric privacy) and personal data requirements, posting or otherwise giving notices required to be given by law, worksite safety, matters governed by the National Labor Relations Act (NLRA), warning of layoffs and providing retraining under the WARN Act and similar laws, accommodating religious or comparable moral practices, pay equity laws including disclosure requirements, laws relating to your recruitment and hiring process, and complying with laws providing for legally-protected leave such as the FMLA and USERRA and mandatory paid or unpaid leave (you will be the employer or primary employer for purposes of such leave laws). You are responsible to provide all equipment, training, and working facilities for Covered Employees and comply at your own expense with all safety, disability, and other laws applicable to your business, operations, and worksites. You agree not to retaliate against any Covered Employee for exercising rights under workers’ compensation or other law.
OSHA compliance. You are responsible for compliance with occupational safety and health law relating to Covered Employees such as maintaining safe workplaces in compliance with law, satisfying requirements under OSH general duty clauses, completing OSH logs and reporting to OSH agencies (state and federal), investigating accidents, detecting and remediating hazards, providing protective equipment and safeguards, providing training, maintaining safety committees and meetings, and maintaining any required programs or plans. If our loss control staff make recommendations relating to occupational safety compliance you agree to notify us if you choose not to follow them. You will give our loss control staff and representatives of our insurers reasonable access to your worksites and records at mutually agreeable times. Although our staff may make recommendations, assist you in investigations, and provide resources such as training and safety plan materials to help you meet your obligations, we assume no responsibility or liability and make no warranty in this regard (for example, we cannot guarantee that complying with our recommendations will result in your being found compliant with laws or achieve or avoid any other particular result or that we will identify all violations or hazards).
Unions. If Covered Employees are represented by a union, seek to be represented, or otherwise engage in concerted activity pursuant to the NLRA, you are responsible for all such matters including elections, bargaining, fulfilling your obligations under collective bargaining agreements, contributing to union benefit plans, and unfair labor practice claims. We do not undertake responsibility to provide HR advice with respect to matters covered by a collective bargaining agreement or subject to collective bargaining. We have not been retained to provide services relating to persuader activities. We will not remit funds to unions or union plans and no money in our possession will be deemed to belong to a union or union plan; we will credit you for applicable deductions you instruct us to take so you can remit them.
HR recommendations. If our HR staff make recommendations relating to compliance you agree to notify us if you choose not to follow them and by not following them you waive any EPLI coverage we may provide for any matter arising from or relating to the subject of the recommendations. You may request that our senior HR staff review recommendations. HR recommendations and advice are not legal advice or legal opinions. We cannot guarantee that complying with our recommendations will result in your being found compliant with laws or achieve or avoid any other particular result.
Insurance you purchase. We only undertake to maintain the insurance described in our Agreement and our Agreement is not a contract of insurance. You are responsible to maintain any insurance and bonding you deem appropriate or that is required for your business. You agree at a minimum to maintain, and on our reasonable request provide certificates of, commercial general liability, vehicle liability (if any Covered Employee operates a vehicle in the course of employment), and professional liability (if applicable to your business), each with not less than $1 million/claim limits, and provide us certificates of insurance on our reasonable request. We suggest you name us as an additional insured on your policies so that they may mitigate indemnification obligations. Availability and limits of insurance will not affect obligations under our Agreement.
Unemployment taxes/contributions. SUTA surcharges, special assessments, training fees, retroactive charges, and other amounts imposed on us by law in addition to unemployment taxes as a result of or in connection with reporting unemployment contributions relating to Covered Employee payroll will be passed through to you and your responsibility to pay, including after our Agreement terminates. In FUTA credit reduction states (where the state has not timely repaid a federal unemployment compensation loan or repayment is in question) surcharges will be added to offset FUTA credit reductions. In states where unemployment taxes are reported to your account an administrative charge based on SUTA taxable wages will apply, and you agree to give us or our third party vendor unemployment powers of attorney, your most recent rate notices, and any other documents and authorizations we reasonably request in order to perform our unemployment-related Paychex HR PEO Service functions on or before the date our Agreement takes effect and as appropriate thereafter; we cannot process unemployment claims or report at an accurate rate without them (until you provide all such documents for a given state we may invoice you assuming the maximum rate and will not provide a refund if you later provide different information).
FICA tax tip credit. We will claim the federal “Credit for Employer Paid Social Security and Medicare Taxes Paid on Certain Employee Tips” net of the effect of the nondeductible expense for FICA related to tips (commonly referred to as the FICA tax tip credit) with respect to wages we issue for Covered Employees who customarily receive tips from customers for providing, delivering, or serving food or beverages in accordance with the tips you report to us (to avoid duplication you will not file for the credit and will report all tips to us). If you report tipped wages to us for Covered Employees we will calculate the FICA tip credit available as of the end of each calendar quarter in our business judgment and in accordance with our processes issue you a credit against our invoices (not cash) equal to a portion of the available FICA tip credit associated with the tipped wages you report provided you are actively our PEO client and current in all your obligations to us on the date we issue the credit.
When our Paychex HR PEO Service begins and ends
Paychex HR PEO Service Term. Our Paychex HR PEO Service takes effect on the first day of the first period for which we issue PEO payroll. Until then we will have no obligations relating to our Paychex HR PEO Service. Our Paychex HR PEO Service has the initial and renewal Terms indicated on the Signature Packet or Service Agreement Initiation Request. Our Paychex HR PEO Service will terminate on the last day for which we are responsible for Covered Employee payroll (not, for example, the date on which you pay us or the last paycheck date). We have no responsibility in connection with our Paychex HR PEO Service for any matter to the extent arising after our Paychex HR PEO Service terminates (including insurance, taxes, wages, and benefits) and our co-employment relationship with Covered Employees ends not later than when our Paychex HR PEO Service terminates. If you do not pay us all amounts due when due, our Paychex HR PEO Service will be deemed terminated by you as of the last payroll ending day on which you were fully paid up or such later day as we consent to in our discretion, subject to reinstatement in our discretion.
Termination for convenience. You can terminate our Paychex HR PEO Service for convenience effective as of the last day of any Term by giving us at least the written notice specified on the Signature Packet or Service Agreement Initiation Request so we can implement an orderly wind- down. When you terminate our Paychex HR PEO Service other than for our material breach you agree to pay a transition fee in the amount indicated on the Signature Packet or Service Agreement Initiation Request based on unique worksite employees active in our system in the 90 days before termination (the “Termination Employee Count”) but we will waive that fee if you give us at least the written notice specified on the Signature Packet or Service Agreement Initiation Request and fulfill all your obligations to us incurred through the notice period. We can terminate our Paychex HR PEO Service and Agreement (together or separately) on 30 days notice to you.
Early termination fee. Our fees assume that you will remain our PEO client for entire Terms. If our Paychex HR PEO Service terminates prior to the end of a Term, you agree to pay an early termination fee based on the Termination Employee Count times the amount per day shown on the Signature Packet or Service Agreement Initiation Request times the number of calendar days remaining in the Term after termination. However, the early termination fee will not apply if our Paychex HR PEO Service terminates because you terminate it: for our material breach; we terminate it for convenience, material adverse change, or changes in law which adversely affect our relationship; or you give us 30 days notice of termination within 15 days of our notifying you that we will raise your administrative fees (other than for mandatory increases) with respect to codes already listed on the most recent pricing exhibit effective other than the first day of a Term, in each case provided you fulfill your obligations to us incurred through the end of the notice period (if applicable) or the date of termination if no notice period applies.
Termination for breach. Either you or we can immediately terminate our Paychex HR PEO Service for material breach by written notice reasonably identifying the breach. We can also terminate our Paychex HR PEO Service immediately by written notice if you experience a material adverse change in condition (financial or otherwise), or because of changes in law that adversely affect our relationship.
Post-termination. When our Paychex HR PEO Service terminates there may be things you or we have to do to fulfill obligations already incurred (for example, we will provide Covered Employees W-2s for wages we issued during the year). These things will not extend the Paychex HR PEO Service termination date. We will not be responsible for any additional Paychex HR PEO Service after our Paychex HR PEO Service terminates; you will be responsible for all matters relating to former Covered Employees including pay, benefits, taxes, accrued leave (paid or unpaid) and other accrued benefits or incidents of employment, and workers’ compensation. When our Paychex HR PEO Service terminates you will immediately notify your workforce of termination of the relationship with us and that we are no longer providing workers’ compensation or any other insurance, benefits, or payroll, and we may also notify them.
Information and cooperation
Information generally. You agree to report and pay for all taxable compensation for employment and all compensation that would be reported on a W-2 to Covered Employees through our service within timeframes we mutually confirm with you and in accordance with law, and to provide us all data elements we need to make payroll-related calculations and otherwise perform our Services or comply with law (including updating the data as appropriate). You will determine and notify us of each Covered Employee’s entitlement to or exemption from overtime and any other information we need to run their payroll. You will identify the workers’ compensation code describing each Covered Employee’s work, which must be a code on a current pricing exhibit to our Agreement; additional codes may be added with our consent and will be priced separately. If a Covered Employee has been miscoded we can adjust the fees charged with respect to the Covered Employee both prospectively and retroactively to reflect the proper code (this does not waive any breach of our Agreement caused by such misclassification or require us to accept Covered Employees in codes we did not approve). If information you report to us is noncompliant with law (for instance, if you instruct us to pay less than the applicable minimum wage or do not instruct us to include legally-mandated leave accruals) we may, but are not required to, refuse to process payroll or adjust information in accordance with the minimum requirements of law and invoice you accordingly. By doing so or not doing so we do not assume your responsibility to comply with law. We are not required to extend you credit and if we release Covered Employee payroll before you have paid us amounts due in connection with it, it will not be considered a loan to you. You agree to submit new hire documentation within three days of hire (however an employee will not be a Covered Employee until, among other things, we have received their new hire documentation), keep Covered Employee information up to date, and notify us within two days of employee separation using our designated forms (fees may be charged for late reporting). We will confirm with you the cycle on which payroll information and payment must be submitted. If you report no pay for a Covered Employee active on our system for a pay period a charge will apply.
Reporting. To the extent a government agency requires that PEOs rather than their clients submit reports with respect to Covered Employees you agree to timely provide us all information we need to complete such reports. To the extent PEOs are not required to submit such reports with respect to Covered Employees you will be responsible for filing your own reports though we may assist you, for instance by providing information to you.
Unemployment claims. You agree to respond to requests for information and documents from us or third parties we retain to assist with unemployment claims so that responses to unemployment claims and related agency communications can be submitted within the time limits set by law (penalties can be imposed by state agencies for not providing timely, complete, or accurate responses which we will pass through to you if you did not respond timely, completely and accurately, and we may charge fees if benefits are granted against our state unemployment tax account as a result of your not responding timely, completely, or accurately). In states where unemployment taxes are reported to our account you agree to cooperate with us to contest claims against our account, including by testifying in hearings, unless we determine they should be not be contested, including after our Agreement terminates.
Opening and closing worksites. If you open, acquire, or close a worksite where Covered Employees work you agree to notify us at least 30 days in advance or, if that is not possible, as soon as possible. If you experience a closing or mass layoff as governed by the federal WARN Act or similar law, you will notify us at least 65 days in advance or if that is not possible, as soon as possible and comply with the WARN Act and any other applicable law relating to the closing or layoff.
Changes in ownership and corporate form. If your ownership or corporate form changes (for example, from a corporation to an LLC) you agree to advise us reasonably prior to the change becoming effective; it may affect our Services, reporting to government agencies, and benefit plans.
Governmental and private actions. If you become aware of an actual or threatened governmental or private action, complaint, inquiry, or investigation of any kind relating to Covered Employees, their benefits, wages, occupational safety, or employment taxes, or their terms and conditions of employment, you agree to contact your HR representative as soon as reasonably possible and keep us informed on an ongoing basis.
Workers’ compensation provided by us. If we are responsible under our Agreement to provide workers’ compensation coverage for Covered employees:
We will provide workers’ compensation coverage (but not any other form of worker injury coverage such as Longshore and Harbor Workers Protection Act, Jones Act, or FELA) in the United States from a carrier licensed where Covered Employees work and written on a form appropriate for PEOs under applicable law. Claims will be administered by licensed third party administrators.
We do not undertake to provide workers’ compensation for anyone other than Covered Employees, however, if we are required by law or legal process (or alleged to be) to provide workers’ compensation coverage for anyone working for you who is not a Covered Employee such as your independent contractors or held or alleged to be liable for not doing so you will save, defend, hold harmless, and indemnify us for, and bear all costs of complying with, such legal requirements and claims, actions, allegations, and investigations relating to them (including reasonable attorney fees), and provide us the information, funds, and cooperation we need to comply.
If a Covered Employee is injured at work, even if the injury is small or the Covered Employee does not want medical care, you will have a manager notify us as soon as possible using the toll-free number we designate. A late fee will be charged if notice is given more than 48 hours after the injury. You agree to provide Covered Employees modified duty assignments consistent with workers’ compensation return to work releases if reasonably available, including after our Agreement terminates.
Monopolistic jurisdictions. In monopolistic jurisdictions you agree to obtain and maintain workers’ compensation coverage if required by law regardless of whether we are otherwise providing it under our Agreement. We will report under your policy as required of a PEO by law.
Other worker injury coverage. If your business is subject to worker injury coverage requirements other than workers’ compensation, such as Longshore and Harbor Workers Protection Act, Jones Act, or FELA, you must provide that coverage at your sole expense, name us as additional insureds, and defend, hold harmless, and indemnify us for any actions, allegations, or investigations relating to claims under those worker injury coverage requirements.
Workers’ compensation provided by you. If you are responsible under our Agreement to provide workers’ compensation coverage for Covered Employees: You agree to obtain and maintain at your sole expense legally-compliant workers’ compensation coverage (both Part A and Part B) for all Covered Employees, from carriers admitted in the jurisdictions where Covered Employees work, with limits not less than the greater of statutory minimums or $1,000,000/$1,000,000, and you will retain licensed third party administrator (TPA) services to administer claims under your policies; You cannot self-insure or elect not to be covered; You will name “Paychex, Inc. and its subsidiaries at all levels and affiliates” or another designation approved by our Risk department on your workers’ compensation policy on a NCCI or state-approved form applicable to PEOs (generally by endorsement as additional insureds or insured labor contractors); The parties intend that if you are responsible for providing workers’ compensation we will have fulfilled any legal obligation to provide workers’ compensation to Covered Employees, and that we and you both enjoy the protection of the exclusive remedy of workers’ compensation for claims by Covered Employees; If for any reason the insurance to be provided by you under this provision fails to defend and indemnify us in any workers’ compensation claim (including Part A and Part B claims) by a Covered Employee, or if we are alleged or found not have provided workers’ compensation coverage or to not be entitled to the exclusive remedy of workers’ compensation you will unconditionally defend, hold harmless, and indemnify us and our workers’ compensation carrier and TPA, including for reasonable attorney fees, with respect to such claim, investigation, allegation, or other matter and anything arising from or related to it; You will provide us certificates of insurance showing compliance with your obligations and provide copies of your policies on our reasonable request; You will be solely responsible for funding all premiums, deductibles, retentions, broker fees, collateral, deposits, security requirements, fixed costs, TPA fees, taxes, assessments, and any other fees or costs associated with the coverage to be provided by you; Your choice of carrier and TPA, terms of coverage such as deductibles and exclusions, and the form by which we are covered by your policy must be acceptable to us; If you fail to provide coverage or proof of coverage complying with your obligations we may, but are not required to, purchase such coverage at your expense.
Jurisdiction-specific provisions (Paychex HR PEO Service)
Provisions are included in this section to comply with the laws of specific jurisdictions if applicable, and apply to our Paychex HR PEO Service within those respective jurisdictions. If we undertake responsibility for something in the jurisdiction-specific provisions that we do not undertake elsewhere in the Terms of Service, as between you and us the different allocation of responsibility in the jurisdiction-specific provisions will be disregarded for purposes of indemnification. We reserve a right of direction and control over Covered Employees and the right to hire, terminate, and discipline Covered Employees to the extent expressly required in PEO relationships by applicable law and then only to the extent necessary, if any, to fulfill our obligations under our Agreement (this does not imply that we exercised such rights in a given situation and does not make us responsible for doing so or not doing so, including for purposes of indemnification), and you exercise direction and control over Covered Employees and the right to hire, terminate, and discipline them including that necessary to conduct your business, discharge any fiduciary responsibilities, or comply with applicable licensure, regulatory, or statutory requirements. You exercise your direction and control of and other rights regarding Covered Employees at all times and are responsible for the consequences of doing so. Where we are required by law to assume a responsibility without regard to payment by you, that provision is not for your benefit (you cannot enforce or rely on it in the event of your breach) and does not relieve you of your responsibilities under our Agreement; it is included to comply with jurisdictional requirements.
Alabama. You and we have a right to hire, discipline, and terminate Covered Employees subject to the terms of any applicable collective bargaining agreement. We assume responsibility to pay wages, collect, withhold, report, and remit payroll-related and unemployment taxes to the extent you have funded them, provided “wages” does not include any obligation between you and a Covered Employee for payment beyond the Covered Employee’s salary, draw, or regular rate of pay (such as bonuses, commissions, severance pay, deferred compensation, profit sharing, vacation, sick, or other paid time off pay).
Alaska. You consent to your having control of Covered Employees as provided in our Agreement.
Arizona. We will make payment for employee benefits for Covered Employees to the extent expressly required of us in our Agreement. For purposes of our obligation to pay wages of Covered Employees, wages do not include obligations between you and a Covered Employee that exceed a Covered Employee’s salary or that constitute bonuses, commissions, severance pay, deferred compensation, profit sharing, or other paid time off pay. Both you and we have a right to hire, terminate, and discipline Covered Employees. The responsibility to obtain workers’ compensation coverage for Covered Employees from a carrier licensed to do business in Arizona is ours and we agree to maintain it and provide to you at the termination of our Agreement (if you request it) records regarding the loss experience, related to the workers’ compensation insurance provided to Covered Employees, unless the parties have executed an agreement to the contrary (which may include the Signature Packet or Service Agreement Initiation Request). You are responsible for compliance with the Legal Arizona Workers Act (“LAWA”) and represent that you have complied with LAWA with respect to every employee in Arizona you submit to be a Covered Employee.
Arkansas. We do not assume responsibility to make payments for employee benefits for Covered Employees. We will maintain records regarding the premium and loss experience related to workers’ compensation insurance provided by us to Covered Employees and if requested by you at or within a reasonable time after termination of our Agreement, we will provide such records to you (if we cannot you can obtain it from our insurer). While our Agreement is in effect and for 90 days thereafter, you may on reasonable request receive records regarding payroll, workers’ compensation coverage, losses and claims, and employee benefits provided our Agreement, and we may charge a reasonable fee for providing them.
California. We do not have the right to control management of workers’ compensation claims; if we provide workers’ compensation for Covered Employees our insurers and/or TPAs will manage claims. You are responsible for paying state assessments levied as a result of your workers’ compensation experience modification. You are responsible for maintaining the working environment and equipment for Covered Employees in a safe, hazard-free manner and as required by law. You represent that all Covered Employees will at all times be covered by an injury and illness prevention program (IIPP) that complies with law. You have control over access to your worksites; we cannot enter your worksites without your permission. If we make recommendations or provide training or undertake any other activity relating to worksite safety, we do so as part of our internal risk management processes, not as a service we charge for, and by doing so (or not doing so) we do not undertake any liability or responsibility for worksite safety, which remains your sole responsibility. We cannot make any modifications to your worksites or equipment used by you or provide personal protective equipment (PPE). Pursuant to California Labor Code Section 2810.3 (prohibiting shifting liability for payment of wages and workplace safety violations, among other things, to a labor contractor) all civil legal responsibility and civil liability for payment of wages and workplace safety violations remains with you and is not shifted to us. For purposes of information subject to the California Consumer Privacy Act as amended (CCPA) with respect to Covered Employees you are a business and we are a service provider, accordingly we will not retain, use, or disclose personal information for any purpose (including a commercial purpose) other than to perform Services or as otherwise permitted by our Agreement or the CCPA or other applicable law and you are responsible for employee notifications and responding to employee requests. You consent to our applying our standard document retention, privacy/security, and other data and access use policies to information covered by the CCPA and agree that we may freely use and retain information in our possession in anonymized/de-identified form. The Paychex Services Agreement Addendum for California Consumer Privacy Act, as it may be amended from time to time (available at go.paychex.com/ccpa), is incorporated into our Agreement.
Colorado. You agree to obtain a signature on our Employee Acknowledgments from each person you submit to us to be a Covered Employee, which will constitute that person’s consent to co-employment. We will maintain employee records relating to Covered Employees that we generate, and you will maintain any records you generate and/or that are not maintained by us. Covered Employees will be assigned to your locations. We retain the right to set Covered Employees’ rates of pay which will be at least the minimum required by law. We have the right to provide for the welfare and benefit of Covered Employees through such programs as professional guidance including employment training, safety, and compliance matters. We will comply with all provisions of Colorado law that apply to large employer health plans (where applicable to our plans). You and we share responsibility for addressing Covered Employee complaints, claims, or requests that relate to employment and our Paychex HR PEO Service (you will notify our HR department of any such matters and cooperate with us in their resolution), subject to allocations of responsibility in our Agreement. You are responsible for policies and procedures related to the conduct of the work that leads to the conduct of your business and the production of its goods and services. Assignments of Covered Employees are intended to be long-term, not temporary.
Connecticut. You agree to obtain signed Employee Acknowledgments from each person you submit to be a Covered Employee. You will be solely responsible for directing, supervising, training, and controlling the work of Covered Employees with respect to your business activities and are solely responsible for the acts, errors, or omissions of Covered Employees with respect to such activities. Neither party will be liable for the acts, errors, or omissions of the other or any Covered Employees when acting under the other’s express direction and control, and you acknowledge that you expressly direct and control Covered Employees at all times. You are solely responsible for the quality, adequacy, or safety of the goods or services produced or sold by your business. We will make payment for Covered Employee benefits to the extent, if any, that we have assumed responsibility in our Agreement.
Florida. You warrant and represent under penalty of perjury that as of the inception of our Paychex HR PEO Service you are not delinquent in the payment of any fees owed to a PEO/employee leasing company or premium owed to a workers’ compensation insurer that is not subject to dispute. We assume responsibility for the payment of wages for work as a Covered Employee, and full responsibility for payment of payroll taxes and collection of taxes from payroll on Covered Employees, without regard to payment by you. We retain a right of direction and control over the management of safety, risk, and hazard control at your worksites affecting Covered Employees, including responsibility for performing safety inspections of your equipment and premises and for the promulgation and administration of employment and safety policies. We and our assigns may conduct an annual onsite physical examination of your worksites. We retain the authority to hire, terminate, discipline, and reassign Covered Employees, however, you have the right to accept or cancel any such assignment to you. We will give Covered Employees written notice of the relationship between us and you. We and our assigns have the right to conduct onsite physical examinations of your operations including after our Paychex HR PEO Service terminates to aid in the determination of proper workers’ compensation classifications of Covered Employees and to aid in determination of payroll amounts paid to Covered Employees (see Rule 61G7-12.001, F.A.C. and 440.381 F.S. and rules promulgated thereunder). You and we agree and intend that we will have the ability to avoid liability for tortious actions of employees including Covered Employees to the fullest extent allowed by law pursuant to Title XLV, Chapter 768.098. You have absolved us and we are expressly absolved of control over day-to-day job duties of Covered Employees and actual control over job sites. You are required to report complaints, allegations, or incidents of any tortious misconduct or workplace safety violation by Covered Employees to our HR representative. You, not we, are responsible for compliance with 448.095 Florida Statutes (relating to employment eligibility verification) with respect to Covered Employees.
Hawaii. Pursuant to Hawaii Revised Statutes 373L-B, as the employer of Covered Employees we, not you, are solely responsible for complying with all laws relating to unemployment insurance, workers’ compensation, temporary disability insurance, and prepaid healthcare programs with respect to Covered Employees.
Idaho. We retain the authority to hire, terminate, discipline, and reassign Covered Employees, however, you have the right to accept and cancel any such assignment to you and are responsible accordingly. We will provide written notice of the relationship between you and us to Covered Employees. You agree to post the following notice in a visible and conspicuous manner at your work sites: “This notice is posted pursuant to Title 44, Chapter 24 Idaho Statutes. The operator of this work site has contracted with Oasis Outsourcing, LLC, Paychex Business Solutions, LLC, or their affiliates for provision of professional employer services including processing of payroll and obtaining workers’ compensation coverage for certain employees. Any questions in this regard should be directed to the operator of this work site. Oasis Outsourcing, LLC, Paychex Business Solutions, LLC, and their affiliates may be contacted at 2054 Vista Parkway, Suite 300, West Palm Beach, FL 33411.”
Indiana. We will maintain and provide to you at your request at termination of our Paychex HR PEO Service records regarding loss experience related to workers’ compensation coverage provided by us. You will defend, hold harmless, and indemnify us for any matter relating to your state unemployment account for which we may be charged as a successor.
Kentucky. Pursuant to KRS Chapter 336: We have not assumed responsibility to make payments for employee benefits for Covered Employees as a result of the outsourcing of payroll duty by you to us; We have a right to hire, discipline, and terminate a Covered Employee but only to the extent (if any) necessary fulfill our obligations under KRS Ch. 336 and our Agreement; You have the right to hire, discipline, and terminate Covered Employees and have the exclusive right to direct and control Covered Employees to conduct your business, discharge your fiduciary responsibilities, and comply licensure requirements applicable to you or Covered Employees; You are solely responsible for workplace safety and adequacy of goods and services produced or sold in your business, directing, supervising, training, retaining, and controlling the work of Covered Employees and for the acts, errors, and omissions of Covered Employees.
Louisiana. You retain control over your business enterprise and exercise direction and control over Covered Employees as to the manner and method of work done in furtherance of your business; authority and responsibility as to other employment matters, including but not limited to hiring, firing, discipline, and compensation, are allocated between you and us per the terms of our Agreement. Our Agreement is executed between the parties subject to the provisions of Part XXV of Chapter 1 of Title 22 and Part XII of Chapter 11 of Title 23 of the Louisiana Revised Statutes of 1950 and Revised Statute 22:1210.53.
Maine. You acknowledge that by our Agreement we have disclosed to you the services to be rendered, including costs, the respective rights of the parties, and that you may take complaints to the Maine Bureau of Insurance.
Massachusetts. We are entitled to enforce only such employer rights and subject to only those obligations allocated to us in our Agreement or as specifically required pursuant to applicable law including Chapter 149 of the General Laws, sections 192 to 203, inclusive (with respect to any Covered Employee, limited to those rights and obligations arising while a Covered Employee). You are entitled to enforce those rights and obligated to provide and perform employer obligations not so allocated or required. We have a right to hire and terminate Covered Employees as may be necessary to fulfill our responsibilities pursuant to sections 192 to 203, inclusive, provided that you have a right to hire, discipline, and terminate a Covered Employee. Responsibility for workplace safety, risk, and hazard control, including responsibility for disclosing information about workplace injuries and illness required by the federal Occupational Safety and Health Act and for performing workplace safety inspections of all premises where covered employees are employed is allocated to you. You, not we, will be responsible to file Fair Share Contribution Reports, Employer Health Insurance Responsibility Disclosure Reports, and any other reports relating to state-mandated health insurance with respect to Covered Employees.
Michigan. We have the right to hire, promote, reassign, discipline, and terminate Covered Employees but you retain all the rights and responsibilities granted elsewhere in our Agreement.
Missouri. Except as otherwise explicitly provided in our Agreement, you are entitled to exercise all rights, and obligated to perform all duties and responsibilities otherwise applicable to an employer in an employment relationship and you have a right to hire, discipline, and terminate a Covered Employee. We are entitled to exercise only those rights and obligated to perform only those duties and responsibilities required under MO ST 285.700 to 285.750 (including a right to hire, discipline, and terminate a Covered Employee as may be necessary to fulfill our responsibilities under those sections and our Agreement) during the term of co-employment of a Covered Employee. Nothing herein creates any new or additional enforceable right of a Covered Employee against us that is not specifically provided by our Agreement or sections 285.700 to 285.750. With respect to any wages we are required to pay, we may not include in “wages” any obligation between you and a Covered Employee for payments beyond or in addition to the Covered Employee’s salary, draw, or regular rate of pay (excluded payments may include for instance bonuses, commissions, severance pay, deferred compensation, profit sharing, vacation, or sick or other paid-time off pay).
Montana. We assume responsibility for payment of Covered Employee wages, workers’ compensation premiums, payroll-related taxes, and employee benefits we provide from our own accounts without regard to payment by you. We retain the authority to hire, terminate, discipline, and reassign Covered Employees and you have the right to accept or cancel such assignment. Pursuant to the Montana Professional Employer Organizations and Group Licensing Act, Title 39, Chapter 8, Part 208 you have joint and several liability with us for any wages, workers’ compensation premiums, payroll-related taxes, benefits left unpaid by us and, in the event our license is suspended or revoked, this liability is retroactive to your entering into a contract with us. You are responsible for compliance with the Montana Safety Culture Act, Title 39, Chapter 71, part 15.
Nebraska. Employer responsibilities for Covered Employees, including those of hiring, firing, and disciplining, are shared between you and us as provided in our Agreement. Our Agreement is intended to be ongoing rather than temporary. You maintain such hiring and firing authority over Covered Employees so as to qualify for any tax incentives pursuant to the Invest Nebraska Act.
Nevada. If we are responsible for providing workers’ compensation to Covered Employees coverage does not take effect until the effective date designated by the insurer in the policy of workers’ compensation insurance; while the policy is in force we will pay all premiums required by the policy including, without limitation, any adjustments or assessments, and will be entitled to any refunds of premiums; the insurer from whom the policy of workers’ compensation insurance is obtained has the right to inspect your premises and records; your loss experience will continue to be reported in your name to the Commissioner and will be available to subsequent insurers upon request; you at all times are responsible for providing workers’ compensation coverage for any employees of yours that are not Covered Employees and must provide satisfactory evidence of such coverage to our workers’ compensation carrier;
New Hampshire. We assume responsibility for the payment of wages for work as a Covered Employee and any benefits due from us according to the terms of applicable plans without regard to payment by you. We have the right to hire, terminate, and reassign Covered Employees from our payroll. We are the rated employer for unemployment compensation purposes as of the time you and we enter into our Agreement and payments made by us are made on our account, rate, and new wage base. Upon termination of our Paychex HR PEO Service, you will return to your previous rate and account balance, if applicable, and will assume a new wage base. We assume responsibility for payment of state unemployment insurance contributions on wages we issue and benefits due Covered Employees under our Paychex HR PEO Service without regard to payment by you.
New Jersey. We assume responsibility for the payment of wages to each Covered Employee without regard to payment by you, except that this will not affect your obligations with respect to the payment of wages to Covered Employees. We retain the authority to hire, terminate, discipline, and reassign a Covered Employee subject to the Covered Employee’s consent. You have the right to accept or cancel the assignment of any Covered Employee. We will hire the initial Covered Employee complement from among employees of yours when our Paychex HR PEO Service takes effect at comparable terms and conditions of employment as are in existence at your jobsite at that time and as specified by you. You will continue to honor and abide by the terms of any collective bargaining agreement to which you are a party and upon expiration thereof, any obligations to bargain in good faith in connection with such collective bargaining agreements will not be affected in any manner by our Agreement, and you will advise us of any requirements that impact our Paychex HR PEO Service. You and we each retain a right of direction and control over management of safety, risk, and hazard control at work sites or sites affecting Covered Employees including: responsibility for performing safety inspections of your equipment and premises; responsibility for the promulgation and administration of employment and safety policies; and responsibility for the management of workers’ compensation claims, the filings thereof, and procedures related thereto. If when our Paychex HR PEO Service takes effect all your workforce consists of Covered Employees we will report wages and make unemployment contributions based on experience assigned to us, and when our Paychex HR PEO Service ends you will receive a new employer rate if our Paychex HR PEO Service was in effect for at least two years (if less, you will pay contributions at our rate until the next July 1 and your experience while our Agreement was in effect will be factored into your pre-existing rate). If when our Paychex HR PEO Service takes effect less than all of your workforce consists of Covered Employees you must so inform us, and we will report wages and make contributions for Covered Employees based on experience assigned to us, but their experience will be factored into your experience when our Paychex HR PEO Service terminates unless our Paychex HR PEO Service has been in effect at least two years. Nothing in our Agreement diminishes, absolves, or removes any obligations of Covered
Employees to you or of you to any Covered Employee existing prior to the effective date of our Agreement, or creates any new or additional enforceable right of a Covered Employee against us.
New York. We agree to co-employ all or a majority of employees providing services. We reserve a right to hire, terminate, and discipline Covered Employees as well as a right of direction and control but you have discretion as necessary to conduct business, discharge fiduciary duties, or comply with licensure requirements. Pursuant to section 195.1 of the Labor Code you will provide Covered Employees Notices and Acknowledgments of Wage Rate and Designated Pay and keep the originals signed by the Covered Employees on file. We assume responsibility for withholding and remittance of payroll-related taxes and employee benefits from our own accounts for Covered Employees for which we have assumed contractual responsibility in our Agreement pursuant to our PEO Service. We will comply with the New York Disability Law with respect to the payroll we issue. We assume the responsibility to secure and provide required workers’ compensation coverage for Covered Employees either in our name or your name for as long as our Paychex HR PEO Service remains in effect.
North Carolina. Covered Employees are your employees for purposes of any general liability, liquor liability, or vehicle insurance, or fidelity or surety bonds carried by you. All employment responsibilities not explicitly allocated to us in our Agreement or by section 58-89A-100 are allocated to you. Wages, contributions, and charges will be reported to your state unemployment account. We assume responsibility for the payment of wages to Covered Employees as provided in our Agreement. We retain a right of direction and control over the adoption of employment policies and the management of workers’ compensation claims, claim filings, and related procedures in accordance with applicable federal laws and the laws of North Carolina. Upon termination of our Paychex HR PEO Service, if you request it we will provide records regarding the loss experience related to workers’ compensation insurance if provided to Covered Employees pursuant to our Paychex HR PEO Service. Pursuant to section 58- 89A-112, we are not liable for any acts, errors, or omissions of you or any Covered Employee or for the quality, adequacy, or safety of the goods or services you produce or sell.
North Dakota. You agree to obtain signed Employee Acknowledgments from Covered Employees. We have the right to hire, discipline, and terminate Covered Employees to the extent necessary to fulfill our obligations under our Agreement and as may be required by Title 43-55 North Dakota Statutes. We will make payment for Covered Employee benefits only to the extent that we have expressly assumed responsibility for them in our Agreement.
Ohio. Our Paychex HR PEO Service has a term of at least one year (as described above) and is intended to be ongoing rather than temporary in nature. Covered Employees are intended to be assigned on a permanent, not temporary, basis.
Oklahoma. We will make payments for Covered Employee benefits to the extent we have expressly assumed responsibility in our Agreement. At termination of our Paychex HR PEO Service, if you request it, we will provide you records regarding the experience related to workers’ compensation insurance provided by us to Covered Employees.
Oregon. You agree to comply with the Oregon Family Medical Leave Act if you and/or we have 25 or more individuals in Oregon during each of 20 or more calendar weeks in the year in which leave is to be taken. You agree to provide adequate training, supervision, and instruction to Covered Employees to meet the requirements of Chapter 654 O.R.S. (the Oregon Safe Employment Act).
Puerto Rico. Our administrative fees are subject to Puerto Rico sales tax which may be added to our invoices. You agree to fund any required bonuses (such as Christmas bonuses) required under Puerto Rico law which will be paid through us. You are responsible for providing any other benefits required by Puerto Rico law.
South Carolina. We: reserve the right of direction and control over Covered Employees; retain the right to hire, fire, discipline, and reassign Covered Employees; assume the responsibility to pay Covered Employee wages without regard to payment by you; assume responsibility for the payment of payroll taxes and collection of taxes on payroll we issue to Covered Employees; and retain the right of direction and control over the adoption of employment and safety policies and the management of workers’ compensation claims, claim filings, and related procedures on joint agreement between you and us. Notice to or acknowledgment of the occurrence of an injury on your part is notice to or knowledge of us and our workers’ compensation insurer. For purposes of South Carolina Code of Laws, Title 42 (Workers’ Compensation), your jurisdiction is our jurisdiction and that of our workers’ compensation insurer. We and our workers’ compensation insurer are bound by and subject to the awards, judgments, or decrees rendered against them under the provisions of Title 42. Insolvency, bankruptcy, or discharge in bankruptcy does not relieve you or us and your and our respective workers’ compensation insurers from payment of compensation for disability or death sustained by an employee during the life of a workers’ compensation insurance policy. If you engage any employees who are not Covered Employees you must secure and maintain workers’ compensation insurance and the Alternative Workers’ Compensation provisions of our Agreement will apply; if we are providing workers’ compensation insurance you agree to notify us prior to engaging the services of any employee who is not a Covered Employee (if you do not so notify us it constitutes your certification that you have not engaged such services). You certify that that the assignments of Covered Employees are intended to be long-term or of a continuing nature, not temporary, and that a majority of your workforce will consist of Covered Employees. You will post in a conspicuous place for viewing by all Covered Employees the following notice: “We are operating under and subject to the Workers’ Compensation Act of South Carolina. In case of accidental injury or death to an employee, the injured employee, or someone acting on his/her behalf, shall notify immediately [fill in name and number of your supervisor responsible for reporting work-related injuries to our insurer]. Failure to give immediate notice may be the cause of serious delay in the payment of compensation to you or your beneficiaries and may result in failure to receive any compensation benefits.” We are licensed and regulated by the South Carolina Department of Consumer Affairs. Any questions or complaints regarding us should be directed to the Department at 2221 Devine Street, Suite 200, Columbia, SC 29205; https://consumer.sc.gov; 803-734-4251.
South Dakota. You represent that prior to entering into our Agreement you were the employer of your existing workforce. If our Paychex HR PEO Service is terminated, our employment of Covered Employees will also terminate and if a Covered Employee terminates employment with you, employment with us will also terminate. You retain primary control over the hiring, firing, wage rates, salary increases, training, and directing the day to day activities of Covered Employees. You retain primary control over the hiring, firing, wage rates, salary increases, training, and directing the day-to-day activities of Covered Employees. We do not manage or direct the operation of your business.
Tennessee. We assume responsibility for the payment of Covered Employee wages, payroll-related taxes, and (to the extent we have expressly contracted to provide them at our expense) employee benefits from our own accounts without regard to payment by you. We retain the authority to reassign Covered Employees and you have the right to accept or cancel the assignment of any Covered Employee.
Texas. UNRESOLVED COMPLAINTS INVOLVING US OR QUESTIONS CONCERNING THE REGULATION OF STAFF LEASING SERVICES MAY BE ADDRESSED TO THE TEXAS DEPARTMENT OF LICENSING AND REGULATION AT P.O. BOX 12157, AUSTIN, TX 78711, (512) 463-6599 OR (800) 803-
9202. You and we share the right of direction and control over Covered Employees, the right to hire, fire, discipline, and reassign Covered Employees, and the right of direction and control over the adoption of employment and safety policies and the management of workers’ compensation claims, claim filings, and related procedures. We assume the responsibility for the payment of wages to Covered Employees without regard to payment by you. We assume responsibility for the payment of payroll taxes and collection of taxes from payroll of Covered Employees. The foregoing notwithstanding, you are solely obligated to pay any wages for which the obligation to pay is created by an agreement, contract, plan, or policy between you and the Covered Employee, and which we have not specifically contracted to pay. You and we have elected to obtain workers’ compensation insurance for Covered Employees.
Utah. To the extent necessary to fulfill our obligations under our Paychex HR PEO Service and Title 31A, Chapter 40 U.G.S. we have a right to hire, discipline, or terminate Covered Employees.
Vermont. Regardless of any law, regulation, or other authority to the contrary, you accept sole responsibility for, and will unconditionally save, defend, hold harmless, and indemnify us for, any matter relating to any collective bargaining agreements covering Covered Employees or your business, and protection or damages provided under laws to protect the health, safety, and welfare of Covered Employees (other than with respect to workers’ compensation coverage we agree to provide).
Virginia. We hereby notify you that you are obligated to comply with the insuring requirements of section 65.2-8001 of the Code of Virginia with respect to employees of yours, other than Covered Employees with respect to whom we have undertaken in our Paychex HR PEO Service to provide workers’ compensation coverage.
West Virginia. If any Covered Employees are subject to the Coal Workers Pneumoconiosis Fund, you will include us as an additional named insured on your Coal Workers Pneumoconiosis Fund Policy (however, this does not imply that we have agreed to provide services with respect to Covered Employees working in capacities that would subject them to the Fund). You retain the right to hire, discipline, and terminate Covered Employees. If you without good cause refuse a request from us to discipline or terminate a Covered Employee, we have the right to immediately terminate our Paychex HR PEO Service (see Chapter 33 Article 46A of the West Virginia General Statutes).
Wisconsin. We have the right to reassign Covered Employees to other clients. We have the right to set the rate of pay of Covered Employees whether or not through negotiations and whether or not the responsibility to set the rate of pay is shared with you.
Wyoming. Pursuant to section 27-3-501(a)(viii) of the Wyoming Employment Security Law, we: (A) Assign Covered Employees to perform services for you; (B) Set the rate of pay for Covered Employees taking into account your recommendations (you and we have negotiated over how this will be done and the result is reflected in our Agreement); (C) Will pay Covered Employees directly; (D) Retain the authority to assign or refuse to assign an individual to other clients if the individual is not acceptable to you; (E) Determine the assignments of Covered Employees even though they retain the right to refuse specific assignments; and (F) Have negotiated with and will negotiate with you on matters of time, place, type of work, working conditions, quality and price of the service (the results of these negotiations are reflected in our Agreement).
Tribal law. You represent and agree that: You are not an Native American Indian Tribe or a Tribal entity such as a Tribal corporation; Any Tribal sovereign immunity is waived and you and the person signing our Agreement (or any component of it) represents that such person has any authority needed to waive Tribal sovereign immunity; No Tribal court will have jurisdiction over our Agreement or over us by virtue of our Agreement; We are not required to exhaust Tribal remedies with respect to any matter arising from or in connection with our Agreement or its performance or enforcement; We have not entered into consensual relations with any Tribe by virtue of our Agreement or its performance; Our Agreement, its performance, and any matters (including disputes) arising from or relating to it will not threaten the political integrity, the economic security, or the health or welfare of any Tribe; No Tribal law will apply to our Agreement or the parties with respect to their relationship under our Agreement; and No part of this Agreement is performed on Tribal land/Indian trust land. The Tribal law section of our Agreement shall be deemed conclusive proof of the matters recited in it in any legal proceeding.
Non-US jurisdictions. We do not provide Paychex HR PEO Services or otherwise undertake any obligation that would subject us to the jurisdiction of a government other than that of the United States of America or its states, political subdivisions, and territories. Any work that would subject us to such jurisdiction is not work as a Covered Employee; you are solely responsible for it and anything arising from or in connection with it. If a Covered Employee travels outside the US for work you agree to contact us to confirm whether the work is as a Covered Employee and whether our workers’ compensation will apply (if we are providing workers’ compensation to Covered Employees).
Part B: Additional Service descriptions
You have access to the following Services while our Paychex HR PEO Service is in effect.
Employee Handbook Builder. We will provide you access to an internet-based online tool provided by a third-party service provider that enables you to develop, customize, manage, and update your employee handbook in English (fees may apply for translation and additional services you may request from the vendor). We may assist you with your policies but we are not responsible for them and make no warranties with respect to them.
Employee Screening Essentials. Background checks provided through a third-party (you are responsible to comply with law relating to your use of background checks). Fees may vary depending on the background checks you request.
Employment and Income Verification. We will provide you access to a Fair Credit Reporting Act employment and income verification service through a third-party service provider for Covered Employees who authorize the service provider to verify their employment with their employer. You may opt out of this Service online. Individual Covered Employees can opt out at any time directly with the third-party service provider (if a Covered Employee opts out, information pertaining to the Covered Employee will not be transmitted to the service provider). If a Covered Employee disputes the accuracy of the data provided, you agree to reasonably assist in resolving the dispute.
Financial Wellness Service. At no additional cost to you or Covered Employees, Covered Employees may receive direct offers from and access to a Financial Wellness Service provided by a third party on employee websites, and/or by mail, email, or other form of communication. The Financial Wellness Service provides Covered Employees tools and education to assist in addressing financial goals and access to installment loans and lines of credit for which the vendor may charge fees to Covered Employees. The vendor may limit the availability of the Financial Wellness Service and require Covered Employees to execute an agreement with it. Covered Employees participating in the Financial Wellness Service may apply for an installment loan or line of credit from the bank selected by the vendor which will require them to sign a loan agreement and a revocable payroll direct deposit authorization form authorizing deposit of a portion of their compensation to the vendor in payment of loans/lines of credit. You consent to our transmitting information relating to you sufficient for the vendor to identify the Covered Employees who are eligible to use the Financial Wellness Service and, if a Covered Employee uses the Financial Wellness Service, transmitting Information to the vendor so that it may provide the requested services; and to the vendor directly contacting Covered Employees to provide information and marketing regarding the Financial Wellness Service using contact information we provide to the vendor. Covered Employees may elect not to be directly contacted by the vendor by opting out directly with the vendor. You may opt out of or terminate the Financial Wellness Service in which case Covered Employees will no longer have access to it.
FSA Debit Card Service. If you offer this Service, we will provide you access to a stored value processing system provided by a third-party vendor. Covered Employees who elect to utilize the FSA Debit Card will have access to their flexible spending accounts in accordance with a cardholder agreement executed by the Covered Employee and the third-party vendor. You authorize us to provide our agents and subcontractors information pertaining to you and Covered Employees who elect to utilize the FSA Debit Card as is necessary to provide this service. The FSA Debit Card may only be used at specified locations and for certain services or items. Participants' salary reductions for the FSA will be reflected on your invoice each pay period as a deduction from total compensation. The designated salary reduction amounts will be transferred by ACH from your specified bank account to the PBS FSA account, and payments for authorized purchases using the debit card will be made from the PBS FSA account. You will provide us with information pertaining to co-pays, if any, that Covered Employees pay. Upon receipt of co-pay information we may adjudicate claims that match the co-pays without requiring additional paperwork in most instances, based solely on merchant terminal coding. You will update co-pay information in the event it changes. You will provide us with your plan information.
General Ledger Service. On your request, we will provide our standard general ledger report for Covered Employee payroll for you to download to your accounting software through a secure internet site with each regular payroll cycle. Reports are provided in formats generally compatible with popular accounting packages. Additional fees may apply for custom interfaces which are created by a third-party service provider.
Health Savings Account. If you offer a high deductible plan and choose to offer an employer contribution, deduction updates received by us will be applied on a prospective basis as soon as administratively feasible and generally within one to two regularly scheduled pay periods. The contribution(s) elected by you will remain in effect for the plan year in which it is implemented and for all subsequent plan years, unless and until you revoke, amend, or modify such contribution(s) by submitting an HSA Employer Contribution Form. If a Covered Employee has a Flexible Spending Account (FSA) for Unreimbursed Medical Expenses, the Covered Employee may submit expenses under the Unreimbursed Medical Expenses FSA for dental, vision, and preventative care only. The Covered Employee’s HSA may be used to pay for any remaining HSA-qualified medical expenses.
Labor Posters. We will provide you one hardcopy standard state and federal labor poster in English for each state in which you have Covered Employees, and updates as they occur. We will also provide you access to the posters for free download. You may be subject to requirements to post other posters and notices that we do not provide (for instance, posters specific to your industry, posters required if you are a government contractor, posters required by municipal ordinances, and posters in other languages) and are responsible to comply with posting requirements.
Paychex Flex® HR Administration. We will provide you access to an internet-based human resources information system which provides you a dashboard of tools, data, and insights which combine HR Technology, analytics, self-service, and support.
Paychex Learning Enhanced. As an addition to Paychex Learning Essentials, we and/or our third-party service provider will provide you with the ability to add or create custom trainings (you are responsible for the content of custom trainings).
Paychex Learning Essentials. We and/or our third-party service provider will provide you access to the Paychex Learning System, a web-based library of training resources and information and a tool for providing and tracking Covered Employee trainings.
Pay-on-Demand. At no additional cost to you, we will provide Covered Employees access to a membership program through a third-party service provider that allows eligible Covered Employees to access to an amount equal to a portion of their earned but unpaid wages before a scheduled check date and other financial wellness services for a membership fee. If Covered Employees elect to settle any amounts due in connection with their accessing products or services through future payroll deductions we will process the deductions based on information received from the third-party service provider (which we may accept without verifying with you or Covered Employees) on the Covered Employee’s next check dates.
Protection Plus. We will provide you access to a suite of risk management tools and resources including the following (note some clients may have EPLI coverage but not cyber liability or other Protection Plus components, contact your Client Services representative with any questions):
Employment Practices Liability Insurance (EPLI, may also be provided to some clients who are not receiving Protection Plus)
Generally. We maintain employment practices liability insurance (EPLI) that covers you for certain Claims (as defined in our EPLI policy) by Covered Employees, former Covered Employees, and applicants for a Covered Employee position as described in the policy (our Agreement does not expand coverage provided by the policy) that are both made and based on events that occurred while you were covered under the policy. You can only be covered under the policy while our Paychex HR PEO Service is in effect. Compliance with our Agreement at all times, including after our Agreement terminates, is a condition of your being covered (and continuing to be covered) for any Claim.
Notification. If you are notified or reasonably believe that a Covered Employee, former Covered Employee, or applicant for employment as a Covered Employee may allege something that if litigated or the subject of a government agency complaint could be covered by our EPLI policy (for example, if a Covered Employee complains of discrimination, harassment, retaliation, or wrongful termination) you agree to discuss the matter with our HR representatives prior to taking action if reasonably possible.
Reporting. If you receive any written communication relating to an actual, threatened, or potential employment-related legal dispute or government agency action involving a Covered Employee, former Covered Employee, or applicant for employment as a Covered Employee that reasonably could be covered under our EPLI policy, you will notify us as soon as you reasonably can and not later than 30 days from when you were first on notice of it (late reporting can affect the ability to defend the case and result in denial of coverage by the insurer) and provide copies of all relevant documents by email to EPLClaims@paychex.com (even if you notify us other ways, this is the only way a claim will be deemed reported for EPLI purposes including coverage under our policy).
Claims handling. If our EPLI policy covers a claim: We have the right to control the defense and resolution including settlement, including after our Agreement terminates (we will consult with you and your input is welcome), subject to the rights of the insurer, however we will not admit you were guilty or at fault or agree to relief other than monetary relief within the policy limits without your consent which you will not unreasonably withhold. We may assist you through our HR resources in dealing with a claim or potential claim, but under no circumstances will we or any member of our Legal department be deemed to have an attorney-client relationship with you. If outside counsel is appointed for you under our EPLI policy you agree to be represented by the appointed firm, and you also agree to, if requested, sign reasonable joint defense agreements so that you and we can be represented by the same attorneys. You may elect to have counsel of your choice also participate at your own expense which will not count toward satisfaction of the self-insured retention (SIR, which is similar to a deductible) or be covered under our policy. You agree to cooperate in the defense and resolution of EPLI claims.
EPLI benefit. If our EPLI policy covers you for a Claim by a current or former Covered Employee or applicant to be a Covered Employee regardless of whether you and/or we are named in the Claim, you will be responsible for the first $25,000 of the self-insured retention per claim (the first $100,000 per claim for Claims made or that could be brought in any agency, arbitration, court, or other venue in California or under the law of California or its political subdivisions) and we will pay the remainder of the SIR while our Agreement is in effect (the EPLI benefit). If our Agreement terminates for any reason you will be responsible for any of the SIR that remains to be paid as of termination. In order to qualify for the EPLI benefit you must: Be and remain in compliance with our Agreement with respect to the claim and the facts and circumstances surrounding it (before and after it is asserted); Comply with all your monetary obligations to us; Accept the representation of counsel appointed (not request other counsel); Follow the recommendations of our HR staff with respect to the subject matter of the Claim before and after it is asserted; Not withhold consent to settle if recommended by our insurer; and Not attempt to make us liable, or suggest we should be liable, for the claim. The EPLI benefit is not a contract of indemnification or insurance. You agree to timely pay amounts you are responsible for with respect to EPLI claims such as law firm and court reporter bills; we may add past-due amounts to our invoices and collect them on behalf of the service provider as payments due under our Agreement. If any part of the SIR is above $25,000 ($100,000 in California) is satisfied from other sources (such as another insurance policy that provides coverage to you to which our EPLI policy is secondary) our responsibility for the SIR under the EPLI benefit will be reduced accordingly. If our EPLI policy covers you for a Claim under an optional endorsement requested by you or applying only to specified clients of ours, the EPLI benefit will not apply to that Claim; you will be responsible for the entire SIR. If our EPLI policy provides coverage to you for a wage and hour Claim or a Claim under an endorsement rather than the body of the policy, the EPLI benefit will not apply to that Claim; you will be responsible for the entire SIR.
Effect on indemnification. If we are named in a claim covered by our EPLI policy, including after our Agreement terminates, which alleges matters for which you would be responsible under our Agreement, the claim against us may be part of your indemnification obligations, however, to the extent that you and we are both covered under our EPLI policy for the matter and you comply with your obligations with respect to the claim and its subject matter, we will not seek indemnification from you for that matter.
Cyber Liability Insurance (only applicable if you are receiving Protection Plus)
We maintain cyber liability insurance that covers you for certain Claims as described in the policy (our Agreement does not expand coverage provided by the policy).Retirement Services. You may adopt and/or sponsor qualified retirement plans offered through Paychex, Inc. or its affiliate which will perform retirement services. A separate agreement for the retirement Services is required. Some retirement services may incur additional fees as described in the applicable agreement. Upon termination of our PEO Service for any reason the provisions of the separate retirement Services agreement will continue to apply, including fees which may not have been charged while our PEO Service was in effect. You may choose to maintain or adopt a retirement plan not offered through a Paychex or its affiliate or refrain from offering any retirement plan (unless mandated by applicable law).
Part C: General Terms (applicable to all Services)
Liability of third-party service providers. Third-party service providers are solely responsible for their acts or omissions (subject to applicable contractual limitations); we are not liable for them.
Authorizations for Services. You authorize us and our affiliates and third-party service providers to gather, maintain, store, and share information with third parties such as government agencies and third-party service providers as appropriate in connection with any Service you or a Covered Employee use or are given access to.
No warranties. ALL SERVICES ARE PROVIDED ON AN “AS-IS,” NO WARRANTIES BASIS unless an applicable Service Description or other contractual document governing the Service expressly makes a warranty. Without limiting the foregoing, all implied warranties are disclaimed, we make no guarantee that Services or your use of them will be compliant with law, secure, error-free, or will otherwise meet your needs, be fit for particular purposes, or achieve any particular results; and you are responsible for your use of Services. We do not provide, and you will not rely on us for, legal, tax, investment, or financial, or insurance advice (you may separately contract with Paychex Insurance Agency to provide insurance advice) and we and Paychex affiliates do not act as a fiduciary of yours for any purpose (unless you separately contract for retirement fiduciary services).
Agreement term. We have not agreed to provide any Service or undertaken any obligation with respect to a Service until we have accepted your election of the Service, you have taken all steps required to initiate the Service, and any other contractual prerequisites have been fulfilled. Our Agreement will remain in effect for so long as you access any Service incorporated in it unless provided under a separate agreement that survives termination of our Agreement in which case certain terms or conditions (such as pricing concessions for being a PEO client of ours) may no longer apply.
Survival of obligations. Obligations that will survive termination of each Service and our Agreement include any obligation incurred prior to termination, anything explicitly noted in our Agreement or other contractual agreements relating to the Service as surviving, obligations of payment, reimbursement, indemnification, damage limitations, dispute resolution, and cooperation.
No resale. You cannot resell, rebrand, or “frame” our Services or provide them to your clients or any third party’s clients, for instance, as a service
bureau, regardless of whether you charge for doing so. No legal entity can use our Services unless it has a contract with us.
Agents. If you authorize someone, including a third party, to act on your behalf, for instance by providing them your credentials or requesting that we communicate with or accept instructions from them, you are bound by and responsible for their acts and omissions and will require them to comply with our Agreement, and you authorize disclosure of information to them in accordance with the credentials and permissions you grant them. We may decline to allow them to access our systems, accept instructions from them, or otherwise deal with them and we may set procedural and other requirements relating to them. They are not beneficiaries of or entitled to enforce our Agreement and we undertake no duty to them.
Responsibility for payment. You agree to pay invoices for fees and other charges incurred in connection with Services incurred by you (including through people you designate or permit to access Services on your behalf) in good, collectible, US funds (including after our Agreement terminates) without deduction or setoff for any reason when the invoice is issued. If you dispute any invoice of ours or another Paychex affiliate you will nonetheless pay it timely in full, notify the issuing Paychex affiliate of your dispute within 60 days of the invoice (any disputes you do not give notice of in that period are waived), and you and the parties will work in good faith to resolve the dispute; the applicable affiliate will credit you for any overpayment determined through this process. Some Services permit optional purchases including options for which additional fees may be charged. Depending on the Service, we, another Paychex affiliate, or a third-party service provider may bill you. We are not responsible to pay fees you, your designates, or a Covered Employee incur with third-party service providers.
Late/incomplete payments and insufficient funds. Payment is deemed made when we can confirm receipt free and clear without possibility of it being stopped or reversed. If you do not timely pay an invoice, fee, or other amount owed to us in full (including by having insufficient funds available in your designated account), late payment charges of 5% will be applied with compounding interest on the amount outstanding at 1.5% per month, or the greatest amounts allowed by law if less, and we may determine in our discretion without liability how to apply any funds we have received from you to amounts you owe. We are not bound by any designation you might make about how incomplete payments should be applied or by any statement of accord and satisfaction you may make. If sufficient funds are not available from your account to complete a payment due, payments fail, or we cannot confirm them timely for any reason, we may but are not required to take collection action including but not limited to reissuing EFTs at your expense and assessing insufficient funds fees. Payment of late charges and interest does not cure any breach associated with late performance or limit remedies associated with it. You are responsible for any consequences of your paying other than timely and in full.
Payment method. We may from time to time authorize or withdraw authorization to use particular methods of payment by email to your designated contact. If we approve payment for our Paychex HR PEO Service by ACH debit we will initiate ACH debits (we will advise you of the timetable for pay cycle invoicing and payment) and you agree to have funds available in your designated account to satisfy the ACH debit. If we approve payment for our Paychex HR PEO Service by wire you will wire us funds (or at our option permit us to initiate wire transfers from your account) at least two banking days prior to your check date(s) for ordinary course payrolls. You will provide us all information we need to confirm timely receipt of payment by any method.
Fees generally. Amounts we pay Covered Employees as wages are included as Paychex HR PEO Service fees in invoices. The amounts that we bill you are not necessarily representative of our actual costs. Fees based on amount of payroll are calculated on gross payroll unless otherwise noted. Any Paychex HR PEO Service fees associated with insurance on our invoices are for our administrative work in connection with our Paychex HR PEO Service, not premium or commission (except to the extent we may invoice them as an accommodation in connection with policies you purchased through Paychex Insurance Agency). If the taxes or any other amounts we are required by law to pay relating to payroll, benefits, insurance, or our provision of Services go up (mandatory increases), we can increase the fees we charge you accordingly, and if a mandatory increase has a retroactive effect we can charge you retroactively, including after our Agreement terminates. Elective Services provided through third parties, that are in addition to Services provided at no-additional cost, or that are on a per-transaction basis may be at an additional charge. Fees charged on the basis of number of active Covered Employees will apply even if a Covered Employee is not paid in a given invoice period. You are responsible for any taxes imposed in connection with our Services such as sales tax, other than taxes imposed on our income (if you claim an exemption you will provide substantiation acceptable to us). You have no right to interest that may accrue on amounts we receive or hold.
EFT. If you pay us using EFT:
You will designate a US bank account from which funds will be drawn and which you will ensure has sufficient funds to meet your obligations to us when due. You will provide any authorization we need to originate EFTs (if applicable) and verify availability of funds in your account. You authorize us to collect all amounts due from your account when due or payable (including after our Agreement or the applicable Service terminates). Your use, order, or receipt of our Services constitutes your authorization for us to create and transmit EFT credit or debit entries for all amounts due from you.
ACH EFTs are performed under the National Automated Clearing House Association (Nacha) operating rules as they may be amended, which can be viewed at NACHAOperatingrulesonline.org. You: authorize us to send entries on your behalf to receivers and assume the responsibilities of an originator of EFTs, if applicable; affirm that you obtained valid authorization of entries from receivers; agree to follow Nacha rules as amended; will not originate any EFT that violates any law; agree that entries are limited to Prearranged Payment and Deposit (PPD), Corporate Credit or Debit (CCD, CTX), International ACH (IAT), or others required for our Services; and agree that we or originating banks have the right to audit your compliance with Nacha rules with respect to the transactions contemplated by our Agreement. We may identify you to banks involved in EFTs and terminate or suspend our Agreement for breach of Nacha rules. You will notify us pursuant to applicable Nacha rules and applicable law if funding is received from a foreign financial agency, and of any Covered Employees with non-U.S. addresses. We may reject any entry that does not comply with the requirements of our Agreement or Nacha rules, or that exceeds the funds available for payment in your account. We are not responsible for any consequences of rejection of any entry. You agree not to cancel, amend, or reverse an entry received by us once submitted. If on your request we try to cancel, amend, or reverse an entry you will reimburse us for any expense, loss, or damage we incur in connection with doing so and we will have no liability if not successful. We are not responsible for determining if a Covered Employee’s account is able to receive ACH or RTP direct deposits.
Assurances. If you provide us financial assurances such as a personal guarantee, letter of credit, bond, or deposit, or if you maintain a surplus balance with us for any reason, we may but are not required to apply it against any amount that you owe us or any Paychex affiliate. It will not be considered a prepayment including of premiums, fees, wages, or taxes or identified to any trust, taxes, or benefit plan. You will not be entitled to interest on any deposits or other amounts we receive from you. We will return any unused deposits and other financial assurances within a reasonable time after our Agreement terminates and all your obligations to us have been fulfilled.
Compliance with legal process. If we provide information, testimony, documents, or reports in connection with a legal dispute or government investigation or enforcement action involving you that we are not a named party to (other than routine processing of garnishments/wage deduction orders included in our Paychex HR PEO Service) on your request or to comply with law or legal process such as a subpoena or government investigation notice, including after our Agreement terminates, you will reimburse us for the cost of complying including internal labor costs, costs relating to contesting or limiting disclosure, expenses, and reasonable attorney fees.
Privacy, confidentiality, software, and information security
Online Accounts. If you and/or Covered Employees access our Services online or through any mobile or other electronic devices ("Online Account"), you are responsible for designating who is authorized to have access to each Online Account (“Authorized Users”); safeguarding all passwords, usernames, logins or other security features used to access Online Accounts ("Online Account Access"); use of Online Accounts under any usernames, logins or passwords; ensuring that use of Online Accounts complies with our Agreement; and any unauthorized access, or use, of Online Accounts caused by Authorized Users' actions or inactions. You agree to immediately notify us of any actual or suspected unauthorized use of an Online Account. We may but are not required to limit, suspend, or terminate access to Online Accounts if we have reason to believe security or confidentiality may be compromised. Authorized Users select the security level for Online Account Access and you are responsible for these selections. You will review all security levels and determine the level or levels for your Authorized Users. You will implement an information security program appropriate to safeguard Online Accounts/Online Account Access that is consistent with applicable law, safeguards Online Account and Online Account Access for any third-party services integrated into the Services; provides for maintenance and routine review of computing and electronic system usage records (e.g., log files); and safeguards the security of your own data, data storage, computing device(s), other electronic systems, and network connectivity. We are not liable for any consequences, losses, or damages resulting from unauthorized access or use of Online Accounts. We may access Online Accounts to assist in configuration, provide ongoing support, comply with law, and perform administrative functions needed to provide our Services.
Information Security. We maintain a comprehensive information security program including administrative, technical, and physical safeguards we deem appropriate to reasonably protect sensitive information from unauthorized access or acquisition. We do not warrant that information will be free from unauthorized access, interference, or disclosure or that our information security measures will meet your or any third party’s requirements. We make certain information about our information security measures available to clients but are not required to share confidential information about our information security or provide certifications relating to it. We can use, share, and retain information according to our policies such as our document retention and privacy policies, and as may be appropriate to carry out transactions contemplated by our Agreement, including with third parties.
Privacy regulation. You agree not to transmit to us any personally identifiable information or other information that is subject to regulation by a non-U.S. government such as under the European Union General Data Privacy Regulation (GDPR) and you represent that all information you give us is free of such regulation. We are not required to receive, store, or transmit any information in a way that would subject us to the jurisdiction of any non-U.S. government. You consent to our applying our standard document retention, privacy/security, and other data and access use policies to information covered by privacy laws and agree that we may freely use and retain information in our possession in anonymized/de- identified form.
Telephone Consumer Protection Act (TCPA) Consent. You consent to us, our affiliates, and third parties we engage to perform our Agreement contacting you using an automatic dialing system or prerecorded messages at the telephone number(s) you provide (you confirm you are or have consent from the subscriber or customary user of such number(s) to receive such calls), including but not limited to contact regarding promotional offers or messages. If you do not consent, we are not required to perform any Service or take any other action that relies on your consent. You are not required to provide consent as a condition of making any purchase, and you may withdraw consent at any time.
Software. If we provide or provide access to our own or third-party software in connection with our Services via a web browser or otherwise:
We grant you a limited, revocable, non-transferable, non-exclusive, royalty-free (unless otherwise agreed) license to access and use the software in connection with the applicable Service, subject to our Agreement, your compliance with our Agreement, and any documentation, terms of service, or legal notices provided with the software. If at any time you do not accept all applicable terms and conditions you cannot use the software and we will not be obligated to perform Services dependent upon the software. The license will terminate on our notice but in any event no later than when the Service for which the software was provided terminates. We are not obligated to deliver or otherwise make available any copies of computer programs or code. You are responsible for obtaining and maintaining all computer hardware, software, and communications equipment needed to access the software, and for paying any third-party charges (such as kiosk, Internet service provider, or telecommunications charges) you incur in connection with the software.
Software contains valuable trade secrets and confidential information owned by us, other Paychex affiliates, or third parties. You will not, and will not allow anyone to directly or indirectly: sell, lease, assign, sublicense, impair, or otherwise transfer; duplicate, reproduce, or copy; disclose, divulge, or otherwise make available to any third party; use, except as authorized by our Agreement or documentation provided in conjunction with the software; or decompile, disassemble, or otherwise analyze for reverse engineering purposes, the software. You will notify us immediately of any unauthorized use, access, or disclosure of the software and will cooperate in remedying such unauthorized use or disclosure.
Except as may be shown on copyright notices incorporated in software we provide or provide access to or otherwise agreed in writing, as between you and us we own all rights, title, and interest, including, but not limited to, copyright, patent, trade secret, and all other intellectual property rights in any software you receive or access in connection with our Services, including any derivatives, suggestions, and jointly developed works. You irrevocably assign to us or the identified copyright owner all such rights, title, and interest and agree to execute all documents reasonably requested to implement and confirm intellectual property rights as described here, including after our Agreement terminates.
ALL SOFTWARE AND SOFTWARE ACCESS IS PROVIDED ON AN AS-IS, NO WARRANTY BASIS. ANY WARRANTY EXPRESS OR IMPLIED IS EXPRESSLY DISCLAIMED INCLUDING ANY WARRANTY OF SECURITY, FITNESS FOR PARTICULAR PURPOSES, OR THAT SOFTWARE WILL BE BREACH-FREE OR ERROR-FREE. As a condition of receiving or accessing software you agree that our aggregate liability in connection with all software is limited to $1,000 and your only remedy for any matter arising from or relating to your receipt or access of the software is to cease using the software.
Generally. You agree to provide us accurate, complete, and timely information that we reasonably request to perform our Services, for administration of benefits plans we sponsor, and to comply with law, including after our Agreement terminates, and you agree to update such information promptly when it changes; we may rely on it without the need to further verify it. You warrant that the information you provided to us in the course of our client acceptance process prior to entering into our Agreement was complete, accurate, and not misleading as of the date our Paychex HR PEO Service took effect.
Review of information. You agree to review all payrolls, pay records, reports, and other information and work product we provide or make available and advise us of any errors or deficiencies within 30 days of our having provided or made it available. If you do not advise us of an error or deficiency within 30 days or if you approve or authorize us to act on it you will be considered to have confirmed, ratified, and approved it in all respects. Paychex HR PEO Service invoices are generally generated using information or instructions you supply; by actively or passively approving us to run a payroll (including by committing it in our system) you represent and confirm that all elements of the payroll, pay stub or similar record, and related billing are correct and assume responsibility accordingly.
Assignment. Our Agreement can only be assigned or assumed with our prior, express, written consent on a form provided by us (we are not required to sign consents, non-disclosure, or other documents you provide) which we will not unreasonably withhold provided you give us reasonable time and cooperate with our information requests to review the proposed assignment/assumption. A change in control transaction or series of transactions where you are not the surviving party or your demographics materially change is an assignment for purposes of this paragraph.
Circumstances we cannot control. If our Services are interrupted or impaired by things beyond our reasonable control such as weather emergencies, natural disasters, war, epidemics, failures of banking systems, the internet, or common carriers, or malicious acts of third parties, we will not be in breach of our Agreement as a result, but we will make commercially reasonable efforts to restore service.
Disclaimer of warranties. We are only responsible for the obligations we expressly undertake in our Agreement. No other obligations of ours can be implied by course of dealing or for any other reason. WE MAKE NO WARRANTIES (INCLUDING IMPLIED WARRANTIES) OTHER THAN WHAT WE EXPRESSLY UNDERTAKE IN OUR AGREEMENT; ALL SUCH WARRANTIES ARE EXPRESSLY DISCLAIMED. No communication from us or another Paychex affiliate and no Service we or another Paychex affiliate provide should be relied on as legal, tax, financial, or insurance advice (unless you have separately contracted with Paychex Insurance Agency for insurance advice).
IT work. If we undertake information technology work at your request (for example, providing an interface between our systems and yours) we will describe the work on a Statement of Work approved by you in advance and charge our then-standard hourly rates (which may include minimums). All IT work is provided on an “as-is, no warranty” basis.
How we will resolve disputes
Remedies. Our Agreement is governed by the substantive law of the State of Florida (disregarding its choice of law provisions). Any litigation between you and us will be venued only in the state or federal courts of Palm Beach County, Florida and you and we consent to jurisdiction and venue in those courts (if an action is filed in any other venue without mutual consent the filing party will pay the other party’s expenses including reasonable attorneys’ fees incurred in connection with the improperly filed action). The prevailing party in any litigation will be entitled to its costs and reasonable attorney fees at all levels of proceedings and reasonable costs of collection which may include reasonable attorney fees. BOTH YOU AND WE WAIVE THE RIGHT TO A JURY TRIAL. You agree not to participate in any dispute with us as a member or representative of a class. A party may seek equitable relief without posting bond or security. If you are a government entity or affiliated with a government you waive any sovereign immunity or other defense based on your being a government entity to any obligation of yours pursuant to our Agreement. If any part of our Agreement is held unenforceable, the remainder will continue to be effective.
Mutual indemnification. You and we will each defend and indemnify each-other (including as to reasonable attorney fees) for claims, allegations, actions, investigations, damages, and other matters to the extent that they are or arise out of or in connection with something the indemnifying party exercises control over as allocated in our Agreement, the indemnifying party is responsible for under our Agreement, or the failure of the indemnifying party to fulfill a responsibility or obligation explicitly (not impliedly) arising under our Agreement, regardless of whether the other party was negligent. You and we will promptly tender and reasonably cooperate with each-other in any matter for which defense/indemnification is owed. The indemnifying party will have the right to conduct the defense and compromise claims through reasonable counsel, provided that it cannot without the indemnified party’s consent admit guilt or fault on behalf of the indemnified party or agree to relief other than monetary relief which it alone will pay, and the indemnified party will have the right to provide input as to the conduct of the case.
Limitation on damages. EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN OUR AGREEMENT, NEITHER YOU NOR WE WILL BE LIABLE TO EACH- OTHER PURSUANT TO OUR AGREEMENT, THE TRANSACTIONS CONTEMPLATED BY IT, OR THE EXERCISE OF RIGHTS UNDER IT FOR ANY SPECIAL, INDIRECT, INCIDENTAL, CONSEQUENTIAL, MULTIPLIED, EXEMPLARY, OR PUNITIVE DAMAGES, GOODWILL, OR LOST PROFITS, HOWEVER CAUSED, ON ANY THEORY OF LIABILITY, EVEN IF ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. AS A FUNDAMENTAL PART OF THE BASIS OF OUR BARGAIN YOU AGREE THAT OUR AGGREGATE LIABILITY IN ANY MATTER IS LIMITED TO THE GREATER OF $25,000 OR THE FEES EXCLUSIVE OF PASS-THROUGHS WE RECEIVED IN CONNECTION WITH THE SERVICE TO WHICH THE MATTER IS RELATED IN THE YEAR PRIOR TO THE FIRST INSTANCE OF SUCH LIABILITY ACCRUING IN WHOLE OR IN PART.
Interpretation. When interpreting our Agreement, the phrases “including,” “such as,” and “for example” mean “including but not limited to.” References to “law” include statutory law, regulations, enforceable orders, and common law at all levels of government. “May” means “can, but is not required to.” Where our Agreement assigns a responsibility to a party regardless of whether the word “responsible” is used, unless otherwise explicitly stated it is that party’s sole responsibility. References to timeliness mean within the timeframes we specify and not later than appropriate to comply with legal deadlines. Any failure to strictly enforce our Agreement will not operate as a waiver or require future waivers. As a material inducement to enter into our Agreement, you waive any argument that our Agreement is unenforceable as written, including with respect to early termination and transition fees. There are no third party beneficiaries of our Agreement other than, and to the extent, a third party is entitled to indemnification under it or a Paychex affiliate is deemed a party to it pursuant to a Service, no-one else is entitled to enforce or rely on it. The substantive terms of our Agreement are not affected by where they appear or the heading under which they appear. You and we are sophisticated business entities with access to legal counsel and have bargained over our relationship therefore no provision of our Agreement will be construed against you or us as the drafter.
Included documents. Our Agreement, which supersedes any prior or contemporaneous agreements, understandings, or inducements (including any proposals and confidentiality/nondisclosure agreements), includes the following documents: The Signature Packet or Service Agreement Initiation Request executed by you and us; the Terms of Service; pricing schedules as they may be amended from time to time; any other current Exhibit(s); and any Addendums or other documents that are explicitly incorporated in our Agreement. Other than price terms if otherwise incorporated, no part of any proposal we may have made is part of our Agreement. Only documents drafted by us and not altered (any alterations are rejected) can be incorporated in our Agreement. There are no external agreements, understandings, or inducements. We may send you updated documents including fee changes from time to time by mail, email to our executive contact on file for you, or other method and we update documents incorporated in our Agreement that we maintain online from time to time (we will endeavor to provide reasonable advance notice); use of our Services after updates take effect will constitute acceptance of them. We are not bound by the terms of any purchase order, vendor registration portal, web site, or other contractual language you submit to us or ask us to use; only items included in our Agreement are part of the contract between us.
Notices. Notices pursuant to our Agreement unless otherwise specified must be in writing sent by US Mail or commercial carrier properly addressed and postage paid with proof of delivery, and notice will be deemed given when delivered. Your notice address will be the one we have on file for you, which you may change by notifying us. Our notice address is shown on the Signature Packet or Service Agreement Initiation Request (we may change it by notifying you). If we give you notice of immediate termination for material breach we may do so by sending it to our executive contact on file for you by email or by facsimile along with written notice as provided above, and it will take effect immediately when we send it.