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A07786 Summary:

BILL NOA07786
 
SAME ASSAME AS S03577
 
SPONSORCahill
 
COSPNSR
 
MLTSPNSR
 
 
Requires the department of financial services, in consultation with the department of taxation and finance, to conduct a study regarding insurance or other risk mitigation tools and third-party payroll service providers; provides that the superintendent of financial services shall submit a report to the governor, the temporary president of the senate and the speaker of the assembly of the department's findings, conclusions, and recommendations.
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A07786 Actions:

BILL NOA07786
 
05/21/2021referred to banks
05/24/2021reported referred to ways and means
06/10/2021reported referred to rules
06/10/2021reported
06/10/2021rules report cal.794
06/10/2021substituted by s3577
 S03577 AMEND= BRESLIN
 01/30/2021REFERRED TO INSURANCE
 03/16/20211ST REPORT CAL.572
 03/17/20212ND REPORT CAL.
 03/18/2021ADVANCED TO THIRD READING
 03/23/2021PASSED SENATE
 03/23/2021DELIVERED TO ASSEMBLY
 03/23/2021referred to insurance
 06/10/2021substituted for a7786
 06/10/2021ordered to third reading rules cal.794
 01/05/2022died in assembly
 01/05/2022returned to senate
 01/05/2022REFERRED TO INSURANCE
 02/14/20221ST REPORT CAL.489
 02/15/20222ND REPORT CAL.
 02/16/2022ADVANCED TO THIRD READING
 03/01/2022SUBSTITUTED BY A7786
  A07786 AMEND= Cahill
  05/21/2021referred to banks
  05/24/2021reported referred to ways and means
  06/10/2021reported referred to rules
  06/10/2021reported
  06/10/2021rules report cal.794
  06/10/2021substituted by s3577
   S03577 AMEND= BRESLIN
   01/30/2021REFERRED TO INSURANCE
   03/16/20211ST REPORT CAL.572
   03/17/20212ND REPORT CAL.
   03/18/2021ADVANCED TO THIRD READING
   03/23/2021PASSED SENATE
   03/23/2021DELIVERED TO ASSEMBLY
   03/23/2021referred to insurance
   06/10/2021substituted for a7786
   06/10/2021ordered to third reading rules cal.794
   01/05/2022died in assembly
   01/05/2022returned to senate
   01/05/2022REFERRED TO INSURANCE
   02/14/20221ST REPORT CAL.489
   02/15/20222ND REPORT CAL.
   02/16/2022ADVANCED TO THIRD READING
   03/01/2022SUBSTITUTED BY A7786
    A07786 AMEND= Cahill
    05/21/2021referred to banks
    05/24/2021reported referred to ways and means
    06/10/2021reported referred to rules
    06/10/2021reported
    06/10/2021rules report cal.794
    06/10/2021substituted by s3577
     S03577 AMEND= BRESLIN
     01/30/2021REFERRED TO INSURANCE
     03/16/20211ST REPORT CAL.572
     03/17/20212ND REPORT CAL.
     03/18/2021ADVANCED TO THIRD READING
     03/23/2021PASSED SENATE
     03/23/2021DELIVERED TO ASSEMBLY
     03/23/2021referred to insurance
     06/10/2021substituted for a7786
     06/10/2021ordered to third reading rules cal.794
     01/05/2022died in assembly
     01/05/2022returned to senate
     01/05/2022REFERRED TO INSURANCE
     02/14/20221ST REPORT CAL.489
     02/15/20222ND REPORT CAL.
     02/16/2022ADVANCED TO THIRD READING
     03/01/2022SUBSTITUTED BY A7786
      A07786 AMEND= Cahill
      05/21/2021referred to banks
      05/24/2021reported referred to ways and means
      06/10/2021reported referred to rules
      06/10/2021reported
      06/10/2021rules report cal.794
      06/10/2021substituted by s3577
       S03577 AMEND= BRESLIN
       01/05/2022ordered to third reading cal.277
       02/17/2022passed assembly
       02/17/2022delivered to senate
       02/17/2022REFERRED TO INSURANCE
       03/01/2022SUBSTITUTED FOR S3577
       03/01/20223RD READING CAL.489
       01/05/2022ordered to third reading cal.277
       02/17/2022passed assembly
       02/17/2022delivered to senate
       02/17/2022REFERRED TO INSURANCE
       03/01/2022SUBSTITUTED FOR S3577
       03/01/20223RD READING CAL.489
       03/01/2022PASSED SENATE
       03/01/2022RETURNED TO ASSEMBLY
       01/05/2022ordered to third reading cal.277
       02/17/2022passed assembly
       02/17/2022delivered to senate
       02/17/2022REFERRED TO INSURANCE
       03/01/2022SUBSTITUTED FOR S3577
       03/01/20223RD READING CAL.489
       03/01/2022PASSED SENATE
       03/01/2022RETURNED TO ASSEMBLY
       04/27/2022delivered to governor
       01/05/2022ordered to third reading cal.277
       02/17/2022passed assembly
       02/17/2022delivered to senate
       02/17/2022REFERRED TO INSURANCE
       03/01/2022SUBSTITUTED FOR S3577
       03/01/20223RD READING CAL.489
       03/01/2022PASSED SENATE
       03/01/2022RETURNED TO ASSEMBLY
       04/27/2022delivered to governor
       05/06/2022signed chap.186
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A07786 Memo:

NEW YORK STATE ASSEMBLY
MEMORANDUM IN SUPPORT OF LEGISLATION
submitted in accordance with Assembly Rule III, Sec 1(f)
 
BILL NUMBER: A7786
 
SPONSOR: Cahill
  TITLE OF BILL: An act in relation to requiring the department of financial services, in consultation with the department of taxation and finance, to conduct a study regarding insurance or other risk mitigation tools and third-party payroll service providers   PURPOSE: To require the department of financial services to conduct a study regarding third-party payroll service providers   SUMMARY OF PROVISIONS: This bill requires the Superintendent of the Department of Financial Services, in consultation with the Commissioner of the Department of Taxation and Finance, to conduct a study in which the Superintendent will review the adequacy of employee protections and small business employer protections in the payroll services industry, The Superinten- dent shall make recommendations regarding the same. The bill requires the review to include an assessment of: (a) the present state of employee protections in the payroll services industry; (b) the present. state of small business employer protections in the payroll services industry; (c) the. incidence of fraud or misappropriation of payroll funds in the payroll services industry; (d) the number of small businesses in New York that use payroll service providers; (e) the number and size of payroll service providers in New York; (f) specific causal or facilitative facts regarding instances of fraud or misappropriation by payroll services providers, (g) the feasibility and advisability of requiring payroll service providers to obtain insurance, post bonds, or utilize other risk. management tools to address potential situations in which payroll monies owed to employees on behalf of businesses are stolen, misappropriated, or otherwise rendered unavailable after being transmitted from an employer to a payroll service provider or an affiliated. entity, and (h) the feasibility and advisability of the department of financial services having regulatory oversight over third-party payroll service providers. Within one hundred twenty days of the effective date, the bill requires the superintendent of the department of financial services to submit a report to the governor, temporary president of the senate and speaker of the assembly of the department's findings, conclusions, and recommenda- tions.   JUSTIFICATION: In September 2019, MyPayroll HR, a payroll service provider in upstate New York with clients across the state and nation, abruptly ceased oper- ations and left thousands of employees and small employers without their pay or funds. Employees were left unable to pay bill s and rent, and employers struggled to obtain sufficient funds for outstanding payroll expenses. 'Employees and employers alike were negatively impacted in escalating ways, with employers losing employees and business, and employees losing jobs, assets, and security. This situation suggests that it is appropriate to look more closely at the payroll services industry in New York state, to assess whether more risk mitigation practices and employee/employer payroll protections are needed. This legislation. would serve the interests of consumers, employees, and small businesses in New York.   LEGISLATIVE HISTORY: S6728 of 19/20   FISCAL IMPLICATIONS: None to the state.   EFFECTIVE DATE: This act shall take effect on the one hundred eightieth day after 14 it shall have become a law.
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A07786 Text:



 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                          7786
 
                               2021-2022 Regular Sessions
 
                   IN ASSEMBLY
 
                                      May 21, 2021
                                       ___________
 
        Introduced by M. of A. CAHILL -- read once and referred to the Committee
          on Banks
 
        AN ACT in relation to requiring the department of financial services, in
          consultation with the department of taxation and finance, to conduct a
          study  regarding  insurance  or other risk mitigation tools and third-
          party payroll service providers

          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:
 
     1    Section  1.  1. The superintendent of financial services, in consulta-
     2  tion with the commissioner of taxation and  finance,  shall  review  the
     3  adequacy of employee protections and small business employer protections
     4  in  the payroll services industry.  The superintendent shall make recom-
     5  mendations regarding the same.   Such review shall include  but  not  be
     6  limited to:
     7    (a)  the present state of employee protections in the payroll services
     8  industry;
     9    (b) the present state of small business employer  protections  in  the
    10  payroll services industry;
    11    (c) the incidence of fraud or misappropriation of payroll funds in the
    12  payroll services industry;
    13    (d)  the  number  of  small  businesses  in  New York that use payroll
    14  service providers;
    15    (e) the number and size of payroll service providers in New York;
    16    (f) specific causal or facilitative facts regarding instances of fraud
    17  or misappropriation by payroll service providers;
    18    (g) the feasibility and  advisability  of  requiring  payroll  service
    19  providers to obtain insurance, post bonds, or utilize other risk manage-
    20  ment  tools to address potential situations in which payroll monies owed
    21  to employees on behalf of businesses  are  stolen,  misappropriated,  or
    22  otherwise  rendered unavailable after being transmitted from an employer
    23  to a payroll service provider or an affiliated entity; and
 
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD07628-01-1

        A. 7786                             2
 
     1    (h) the feasibility and advisability of the  department  of  financial
     2  services  having  regulatory  oversight over third-party payroll service
     3  providers.
     4    2.  Within  one hundred twenty days of the effective date of this act,
     5  the superintendent of financial services shall submit a  report  to  the
     6  governor,  the  temporary president of the senate and the speaker of the
     7  assembly of the department's findings, conclusions, and recommendations.
     8    § 2. This act shall take effect immediately.
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