OR HB2236

Professional employer organizations (PEOs) must elect whether to treat covered employees as employees of the PEO or the client employer for unemployment insurance payroll tax reporting purposes

Unemployment benefits are charged to whichever entity (PEO or client employer) is designated under the elected reporting method

PEOs must notify the Employment Department director in writing of their reporting election and provide requested documentation within 60 days if electing client employer reporting

After initial election, PEOs may change their reporting method by written notice, but changes take effect the following calendar year and cannot be changed again for two years

Elections made during the first 120 days after the act's effective date take effect immediately and do not count toward the two-year change restriction; the act takes effect 91 days after the 2025 legislative session adjourns