Professional Employer Organizations
A Professional Employer Organization (PEO) is a business that has an agreement with one or more client companies to manage their human resource issues, such as workers’ compensation, payroll and unemployment insurance.
PEOs do not include independent contractors, temporary-staffing companies, service referral agencies, third-party payers, labor organizations or common-pay agents. We have proposed a regulation (rule) to legally define the term “professional employer organization” (WAC 192-300-200).
The term “co-employer” refers to both the PEO and the client company. It means that both must register with us. The legal definition of “co-employer” is in section 8(3) and (6) of the law.
Quick tips and facts
How to register client companies
All PEOs that have client companies in Washington must submit a client registration form to us with all of the following information for each client company:
- Unified Business Identifier (UBI)
- Employment Security Number
- Names and Social Security number of each corporate officer, owner or limited liability company member
- Physical address in Washington State where payroll records are available for inspection
- A signed power of attorney form
Even if the client company doesn't have any employees, at this time, PEOs must register all client companies that do business in Washington, even if they have no employees in the state.
PEOs outside of Washington State must register. If the PEO has a client company doing business or having employees in Washington, it must register. It does not matter where the PEO is located nor whether the PEO has employees working in Washington.
How to file quarterly tax and wage reports
PEOs are required to file quarterly tax-and-wage reports, broken out by individual client companies. We recommend that they file reports electronically through Employer Account Management Services (EAMS) in one of two ways:
- File a separate electronic report for each client company; or
- Use bulk filing (formerly Washington ICESA format) to send a single file that contains separate reports for each client company.
PEOs also have the option of filing a separate paper report for each client company (forms 5208A and 5208B). To file a paper form please email us and request the forms or call 360-902-0916.
We do not accept copies because our tax forms use special ink that allows the information to be scanned into our computer system. Copy machines cannot reproduce the special ink, so when someone submits a copy of the form, the information must be hand-keyed into the system.
See the proposed rule (WAC 192-300-210(7), (8) and (9)) for details.
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