In former times, Texas professional organizations (PEO’s) were more commonly referred to as staff leasing companies.
Both names mean the same; however, PEO is the updated name (and abbreviation) used today.
The state refers to the term staff leasing company as “outdated”.
PEO’s are regulated by the Texas Department of Licensing and Regulation (TDLR).
This Department is also the obligee; that is, they are the entity requiring the Texas professional employer organization bond.
This surety bond is a prerequisite for licensing.
The Texas professional employer organization bond is required as a financial guarantee to ensure that a licensed PEO, its employees, owners, operators, and managers will comply with all laws as it relates to the their business conduct.
The surety bond protects others from acts of fraud and other criminal activities committed by a PEO in the course of their duties.
Put simply, to determine the amount of the Texas professional employer organization bond required to be posted with the Department, a formula is used.
Section 91.014 of the Texas Labor Code requires a PEO to meet certain capital requirements.
It is this formula which is also used to determine the amount of the bond required.
This is what is done to determine the amount of surety bond required:
You add the amount of capital required as per Section 91.014 of the Texas Labor Code:
The amount of negative working capital (where liabilities exceed assets)
The amount of the Texas professional employer organization bond required.
If you are still uncertain as to the amount required, we understand!
AmeriPro Surety Bonds recommends the following:
We recommend that you submit the dollar amount you believe is required to a trusted accountant for verification; or, you contact the Department (TDLR) for assistance in determining the amount required.
Or, perhaps, both.
The premium required for this surety bond will be determined by the following criteria:
AmeriPro Surety Bonds estimates that the premium for the bond will be a few percentages of the bond amount.
In those cases where an applicant may have a spotty or poorer credit history, the premium may be substantially more; however, in all cases our agency will work to find you the best surety bond pricing.
In those few cases where the surety bond premium may seem exorbitantly high, we may be able to also offer premium financing.
Once purchased, the surety bond is renewed annually.
For those who may need to do so, we are able to postdate this surety bond to have the bond run concurrent with the TX PEO license.
Applicants for the Texas PEO license must complete the following:
AmeriPro Surety Bonds is a surety bonds-only agency which provides license and permit bonds, fiduciary bonds, contractor, and court bonds throughout Texas.
We also provide surety bonds nationwide.
We hope to earn your trust.