EXHIBIT 10.4
Client Services & Co-Employment Agreement
This Client Services & Co-Employment Agreement ("Agreement") is entered
into by and between Vincam Human Resources, Inc. and any of its subsidiaries or
affiliates to which it may assign this Agreement ("Vincam"), and Intelligent
Life Corporation (the "Client Company") is effective on 12:01 a.m. of the first
day of first payroll period which Vincam begins its service (the "Effective
Date").
1. THE PARTIES' INTENT: THE CO-EMPLOYMENT ARRANGEMENT: By entering into
this Agreement, the parties intend to create a co-employment arrangement to
better facilitate the Client Company's core business by achieving certain
economies of scale and scope in human resource-related areas. Because the co-
employment arrangement is a special way of addressing complicated human resource
issues, this Agreement allocates between Vincam and the Client Company the areas
of responsibility and liability associated with the co-employment arrangement.
2. THE CREATION OF THE CO-EMPLOYMENT ARRANGEMENT: A co-employment
arrangement is established by Vincam assuming some of the Client Company's
rights and responsibilities with respect to the "Worksite Employees." The term
"Worksite Employees" means individuals who have submitted a completed employment
application to Vincam, been approved for hire by Vincam, and been assigned by
Vincam to the Client Company's worksite to perform their services under the
Client Company's direction and control. The term excludes 1) those employees
hired by Vincam only (and not the Client Company) to provide the services
offered by Vincam (i.e., Vincam Corporate Employees), or 2) individuals who may
be providing services to the Client Company through a temporary staffing
arrangement, as independent contractors, or any other arrangement. During the
term of the Agreement, the Worksite Employees are employees of both Vincam and
the Client Company. Vincam intends the term "co-employment" to have the same
meaning as designated by some legal authorities in which a company (i.e.,
Vincam) by contract reserves and exercises a right of direction and control over
the Worksite Employees assigned to the Client Company's location with the Client
Company retaining sufficient direction and control over these employees as is
necessary to conduct the Client Company's business and without which the Client
Company would be unable to conduct business, discharge fiduciary
responsibilities, or comply with the law.
2(A) THE CONVERSION PROCESS: Upon execution of the Agreement, Vincam
undertakes the conversion process during which the parties mutually reach an
agreement as to which of the Client Company's employees will become Worksite
Employees. The parties agree that Vincam will not employ any Client Company
employee who is not authorized to work by law. The Client Company agrees to
transfer to Vincam's payroll all employees identified to become Worksite
Employees provided each such employee accepts employment offered by Vincam. The
Client Company retains the sole responsibility for any employee not chosen as a
Worksite Employee if the person provides services to the Client Company during
the term of this
Agreement. When the conversion process is completed, Vincam assigns the Worksite
Employees to the Client Company's worksite to perform the job duties required by
the Client Company at that worksite. The addition of Vincam as a co-employer is
communicated in writing to the employees so that everyone has a clear
understanding of the co-employment arrangement. Because the co-employment
arrangement begins with the Effective Date, the Client Company acknowledges that
it is solely responsible for any employment-related investigation, demand,
claim, and/or litigation that existed or accrued, or which relates to facts or
circumstances which occurred before the Effective Date. The Client Company
acknowledges that such responsibility includes, but is not limited to, payment
of attorneys' fees, investigation costs, damages, liability, or similar changes,
costs, or expenses, and that the Legal Defense Benefit, Section 11, is not
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available under these circumstances.
3. HOW THE CO-EMPLOYMENT ARRANGEMENT AFFECTS THE CLIENT COMPANY'S
BUSINESS: With the creation of the co-employment arrangement, Vincam assumes
employer's rights as to the Worksite Employees, including without limitation,
the right to hire, fire, discipline and pay wages. Although the Client Company
no longer has sole employer rights, it retains the right to reject the
assignment of any worker to its worksite by Vincam, provided that such rejection
does not violate any law. The Client Company retains such direction,
supervision, and control over the Worksite Employees as is necessary to conduct
its business on a day-to-day basis. Further, the Client Company retains full
responsibility for its business, products, and services; the determination of
the level of wages to be paid above the Fair Labor Standards Act (FLSA) minimum
wage and salary requirements; worksite premises; and any third party,
subcontractor, independent contractor or non-Worksite Employee. At all times of
this Agreement, Client Company shall have access to all personnel files of
Worksite Employees and shall have the right, at Client Company's expense, to
make copies of any and all materials contained in said files.
4. MUTUAL DUTY TO COOPERATE; SHARING OF INFORMATION: In recognition of
the effort necessary to provide the services described in this Agreement, both
parties agree to cooperate with each other. The parties acknowledge that the
duty to cooperate is a material term of this Agreement. Vincam agrees to keep
the Client Company informed about potential and actual employee problems KNOWN
TO THE CLIENT COMPANY as they arise. Vincam will also provide the Client
Company with copies of documents contained in a Worksite Employee's file at a
reasonable cost provided that the Client Company gives Vincam reasonable notice
of the need for such files. The Client Company agrees that it will cooperate
with Vincam in the following fashion:
A) promptly and accurately inform Vincam of all employees issues, KNOWN TO
OR REASONABLY SHOULD HAVE BEEN KNOWN BY THE CLIENT COMPANY, including, but not
limited to, employee work-related injuries or accidents, the employees' job
functions and duties, number of hours worked, any union organizational
activities, any formal or informal work-related complaints, including complaints
of harassment or unfair treatment, charges of discrimination, governmental
investigations, threatened employment-related lawsuits, or any similar
employment-related developments;
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B) assist, as necessary, in addressing employee issues, including, but not
limited to, implementing policies and procedures recommended by Vincam,
participating in any employment-related investigations, providing reasonable
accommodations when required by the Americans with Disabilities Act (ADA) or
other comparable laws, and taking steps REASONABLY required OR MANDATED BY OSHA
for workplace safety;
C) give Vincam (or its designated agents and/or attorneys) reasonable
access to the worksite as well as access to information, data, files, etc.,
pertaining to the employees, UNLESS PROHIBITED OR PROSCRIBED BY LAW, which
access includes the right to audit such information or examine the premises on a
periodic basis;
D) consult with Vincam before taking any employment action which could be
construed as adverse to the employee (e.g., firing, demoting, changing job
functions or responsibilities, transferring, etc.);
E) cooperate in the defense of any employment-related claim, charge,
lawsuit, investigation, audit, etc., which may be filed against Vincam, the
Client Company, or both; and
F) provide any other assistance reasonably necessary to perform the duties
of this Agreement.
This duty survives the termination or expiration of the Agreement as long
as the cause of action arose during the existence of the Agreement. This duty
to cooperate does not apply if the parties are litigating against the Client
Company's failure to abide by this provision is a material breach for which
Vincam could immediately terminate the Agreement pursuant to Termination,
Section 10.
4(A) SHARING OF INFORMATION: 1) INFORMATION PROVIDED TO VINCAM BEFORE THE
EFFECTIVE DATE. Before entering into this Agreement, the Client Company agreed
to provide and has provided Vincam with all pertinent information regarding the
Worksite Employees and the benefits provided to them, including the Client
Company's ownership structure, the employees' compensation packages or
information relating to the Client Company as a federal contractor, if
applicable, such as the amount of a certified payroll. This information was
gathered to assess whether the Client Company was an appropriate candidate for
Vincam's services. In recognition of the sensitive nature of the information,
Vincam represents to the Client Company that it has kept that information
confidential and promises that it will continue to do so. By executing this
Agreement, the Client Company represents to Vincam that the information was and
continues to be accurate, to the best of the Client Company's knowledge.
2) SHARING INFORMATION DURING THE AGREEMENT'S EXISTENCE. The Client
Company further agrees that the duty to cooperate includes the duty to share
with Vincam, to the extent permitted by law, all information relating to the
Worksite Employees and the worksite on an ongoing basis, including but not
limited to, promptly providing Vincam with complete and accurate information
pertaining to anything affecting the worksite and the Worksite Employees (e.g.,
hours worked, eligibility for benefits, non-qualified pension plans, employee
accidents and injuries, classification of an employee for workers' compensation
purposes, rejection of the
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assignment of a Worksite Employee). The Client Company agrees to collect,
verify, and transmit to Vincam's administrative office not less than three (3)
business days before each payroll date any information required to determine
accurately the amount due to the Worksite Employees and Vincam. The Client
Company agrees to give Vincam written notice before it closes a plant, facility,
or takes any other action which would require compliance with the federal Worker
Adjustment Retraining Notification Act (WARN), or makes an assignment for the
benefit of creditors, files for relief under the U.S. Bankruptcy Code, or seeks
the appointment of a receiver. The Client Company agrees that it will notify
Vincam at least ten (10) days before a WARN notification is required to be given
to the Worksite Employees. The Client Company agrees to continue to make
complete and truthful disclosures to Vincam of any employment-related
information Vincam needs to perform the duties of this Agreement. Each party
agrees to notify the other immediately of any claim to which the indemnification
may apply (see Indemnification, Section 8).
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4(B) CONFIDENTIAL, PROPRIETARY INFORMATION, TRADE SECRETS, AND
INTELLECTUAL PROPERTY. Because each party will have access to information which
may be confidential, proprietary, and/or trade secrets of the other party, the
parties agree that they will treat confidentially any such information
identified to the other as being confidential and not disclose the information
to any third party (except a trusted advisor, such as the party's attorney,
accountant, or financial advisor) unless required by law. The parties agree
that, if a party gives its trusted advisor any confidential, proprietary
information, and/or trade secrets of the other party, it will take all
reasonable steps to ensure that its trusted advisor preserves the confidential
nature of the information. Any information, data, etc., which the other party
advises the other is confidential, proprietary, and/or a trade secret is
included in this Section, whether such information is considered as such under
the law. The parties agree that this Agreement and information contained in any
attachments to the Agreement, all Vincam forms, manuals, handbooks, or other
materials prepared by Vincam and used to perform the duties of this Agreement
for the Client Company are considered proprietary. The Client Company is
responsible for taking the necessary precautions to designate and safeguard
information it considers confidential, proprietary and/or a trade secret. The
parties agree to use the Confidential Information to facilitate the performance
or enforcement of this Agreement and for no other purposes. If the Agreement is
terminated or expires, this provision survives for five (5) years after such
event or until the information becomes known to the general public. The parties
acknowledge that a breach of this provision would create irreparable harm and,
therefore, the non-breaching party would be entitled to an injunction or similar
remedy to specifically enforce this provision. The parties specifically
acknowledge that money damages alone may not be an adequate remedy for any
damage which might be suffered as a result of a breach of this provision.
Nothing in this provision shall be construed as prohibiting the non-breaching
party from any other remedy or remedies including, but not limited to, recovery
of damages. The parties also acknowledge that the Client Company is the owner
of any intellectual property existing before the term of this Agreement or
created during the term of the Agreement relating to the business of the Client
Company, including but not limited to, inventions, patents, copyrights, and
trade secrets. The Client Company, as the owner of the intellectual property,
is responsible for ensuring that these are protected as well as for payment of
any associated costs.
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5. VINCAM'S SERVICES AND RESPONSIBILITIES: Vincam will co-employ Worksite
Employees and will provide the Client Company with human resource services,
employment practices management, and other services more particularly described
below.
5(A) VINCAM'S RESPONSIBILITY REGARDING THE PAYMENT OF WAGES AND OTHER
EMPLOYMENT-RELATED COSTS: As a co-employer of the Worksite Employees, Vincam
assumes sole responsibility for paying wages to Worksite Employees without
regard to payment by the Client Company to Vincam and collecting and paying
employment-related taxes (including those pertaining to the Federal Insurance
Contributions Act, Federal Unemployment Tax Act, the applicable income tax
withholdings, State Unemployment Insurance, etc.) and providing mandatory
employee benefits (including workers' compensation), and other voluntary
employment benefits as may be provided to the Worksite Employees. (See
Subsection 5C) employee benefits.) However, the Client Company acknowledges
that, to perform these responsibilities, Vincam relies on the Client Company to
supply it with correct information regarding hours worked, job classifications,
and other data Vincam needs to compute accurately wages, taxes, and other
employment costs. The Client Company agrees to provide Vincam with complete and
accurate information and agrees to reimburse Vincam for any costs it incurs if
such information is wrong (whether intended or not). This remedy is in addition
to any other remedy available to Vincam under this Agreement.
5(B) VINCAM'S MANAGEMENT OF EMPLOYMENT PRACTICES: Part of the service
Vincam provides to the Client Company is guidance regarding good management
techniques and compliance with various employment laws. For any Worksite
Employee covered by this Agreement, Vincam will assist the Client Company by
providing compliance guidance regarding the following laws, as amended from time
to time:
1) the FLSA and/or comparable state or local laws;
2) the Consolidated Omnibus Budget Reconciliation Act (i.e., COBRA, the
federal group health plan continuation coverage);
3) the Immigration and Nationality Act and the immigration Reform and
Control Act (the Client Company is considered the employer for purposes of
petitioning and applying for immigration benefits under these laws); [CHANGE FOR
1998]
4) the Consumer Credit Protection Act and/or comparable state or local
laws;
5) the Employee Retirement Income Security Act (ERISA) and other laws
covering employee benefit plans (e.g., group health, cafeteria, and 401(k)
Plans);
6) the Family and Medical Leave Act and similar state or local leave laws;
7) the Occupational Safety and Health Act (OSHA) and comparable state or
local laws, regulations, or ordinances. Vincam retains a right of direction and
control over the management of safety, risk, and hazard control at the worksite
affecting the Worksite Employees, including
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responsibility for performing safety inspections of the Client Company equipment
and premises, and promulgating employment and safety policies;
8) the National Labor Relations Act. The parties acknowledge that the
Client Company is the employer which would be the party to any collective
bargaining agreement because the Client Company exercises control over the
primary employment conditions subject to a collective bargaining agreement.
Vincam acknowledges that the union is the exclusive bargaining representative
for employees covered by any valid collective bargaining agreement. Vincam will
abide by the terms and conditions of any valid collective bargaining agreement
whether in existence as of the Effective Date or if subsequently entered into by
the Client Company and a union; and
9) all other applicable federal, state, or local employment laws (e.g.,
Title VII of the Civil Rights Act, the ADA, the Age Discrimination in Employment
Act, etc., as well as those pertaining to federal contractors if the Client
Company is a government contractor), except for those obligations which the
responsibility of the Client Company as set forth in Client Company's
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Responsibilities, Section 6, below. Vincam does not provide services relating
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to Title III of the ADA (e.g., making the facility accessible to the public,
etc.), however, and Vincam is not responsible for the cost of reasonable
accommodation under Title III.
5(C) WORKERS' COMPENSATION COVERAGE. Vincam will maintain workers'
compensation coverage for each Worksite Employee employed as of the Effective
Date in accordance with the laws of the states in which Vincam provides services
under this Agreement. For a person hired after the Effective Date to be covered
under Vincam's workers' compensation policy, the Client Company must submit to
Vincam the person's completed employment application within two (2) business
days from the date the Client Company selected the person for employment, and
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Vincam must approve the person for employment as well as assign the person to
the Client Company's worksite. If these two conditions are not met, the Client
Company is responsible for providing workers' compensation coverage for that
person. (See Section 6(E) for Client Company's responsibilities regarding
workers' compensation.)
5(D) EMPLOYEE BENEFITS: 1) THE CONVERSION PROCESS AND EMPLOYEE BENEFITS.
As a part of the conversion process, Vincam will provide group health plan
coverage to all of the Client Company's identified COBRA participants who are
covered under the Client Company's active group health plan provided the
following conditions are met: a) the participants were covered under the
Client Company's plan on the day before the Effective Date, b) Vincam hires all
of the employees at the Client Company's worksite at the time of the conversion
following the procedure described in The Creation of the Co-Employment
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Arrangement, Section 2, c) the Client Company terminates the group health
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insurance plan covering these employees, and d) the Worksite Employees
immediately thereafter become covered under a group health plan sponsored by
Vincam. Such coverage will be in accordance with the general COBRA rules. If
these conditions are not met, then the Client Company continues to be
responsible under COBRA for these individuals.
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2) EMPLOYEE BENEFITS DURING THE ARRANGEMENT'S EXISTENCE. Vincam agrees to
assist in administering the Client Company's policies as they may from time to
time be amended, regarding employee benefits such as vacation, sick leave,
family leave, and other comparable benefits. Vincam further agrees to offer to
Worksite Employees certain employee benefits, such as group health insurance,
401(k), and other benefits as identified in the Employee Benefit Attachment to
this Agreement provided and for so long as all eligibility requirements and
governing laws for the specific plan are satisfied. The parties acknowledge
that Vincam is the only sponsor of such plans and is solely responsible for
their administration and compliance with the law. The Client Company agrees
that it does not and will not co-sponsor any of Vincam's employee benefit plans.
If the eligibility requirements of a particular plan cannot be met, Vincam
retains the discretion not to provide, or to discontinue, the benefits of that
particular Vincam plan while this Agreement is in effect or to terminate the
Agreement.
5(E) LICENSES; ACCREDITATION: Because Vincam operates in some states
which require professional employer organizations such as Vincam to obtain a
license or registration to perform these services, Vincam agrees to maintain any
applicable licenses or state registration. Vincam agrees to operate in the
unregulated states using, as a minimum, the standards imposed by the regulated
states. Vincam is also accredited by the Institute for the Accreditation of
Professional Employer Organizations (IAPEO) which has established service
standards. As part of its dedication to quality service, Vincam agrees to
maintain such accreditation and to use its best efforts to comply with such
service standards.
5(F) INSURANCE. Vincam agrees to maintain all required employment-related
insurance to perform the services of this Agreement, such as workers'
compensation insurance. The parties acknowledge and agree that Vincam is not an
insurer, procurer or broker of insurance products, or agent selling the Client
Company insurance or insurance products. As an employer, Vincam provides the
Worksite Employees with workers' compensation and other employee benefits. The
Client Company is not a party to any of Vincam's insurance contracts which
insure any of Vincam's employer obligations or employee benefit plans.
Additionally, the Client Company acknowledges that it is not a co-sponsor of
such plans. The Client Company understands that the cost of the employee
benefits or Vincam's employer obligations is a part of Vincam's cost of doing
business and does not constitute an additional expense charged to the Client
Company.
6. CLIENT COMPANY'S RESPONSIBILITIES. The co-employment arrangement
involves a shifting of certain responsibilities between two employers. Because
the co-employment arrangement does not create identical corresponding
responsibilities between the parties, the Client Company has some
responsibilities which Vincam does not and vice versa. To have a clear
understanding of these duties, this Section sets forth the Client Company's
responsibilities under this Agreement. The Client Company agrees to comply with
the laws described in the Vincam Services and Responsibilities, Section 5,
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listed above. The Client Company recognizes that Vincam's provision of services
does not relieve the Client Company of responsibility and liability for those
matters over which it has control. Additionally, the Client Company agrees to
comply with any other laws affecting or regulating its business, including, but
not limited to, professional licensing, etc. The following is a list of the
Client Company's responsibilities:
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6(A) FOLLOWING VINCAM'S POLICIES AND PROCEDURES: The Client Company
agrees to follow Vincam's policies and procedures relating to the Worksite
Employees, such as reporting changes of employment status, request for leave,
workers' compensation injuries, termination, etc. The Client Company agrees to
follow the procedure for hiring individuals described in Vincam's Services and
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Responsibilities, Section 5(C). The Client Company agrees to use Vincam-
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provided forms (e.g., employment application, change of status, etc.) for the
Worksite Employees. The Client Company acknowledges that Vincam has the right
to retain and reassign a Worksite Employee who has been terminated by the Client
Company (i.e., a Worksite Employee whose assignment to the Client Company's
worksite has been rejected).
6(B) WORKSITE SAFETY. Because the Client Company owns and controls the
worksite, the Client Company agrees to comply with all federal and state health
and safety laws, regulations, ordinances, rules, etc., as amended, including,
but not limited to, those governing OSHA, workers' compensation, etc. The
Client Company agrees to pay for, provide, and ensure the Worksite Employee's
use of any equipment required by law or reasonably required by Vincam or its
insurers for worksite safety. If Vincam informs the Client Company of an unsafe
working condition or a violation of any applicable law, the Client Company
agrees to take the necessary steps to rectify the unsafe condition or correct
the violation within a reasonable time and acknowledges it is responsible for
payments associated with remedying the problem. Failure of the Client Company
to make the necessary correction means that the Client Company assumes all
responsibility associated with the condition or violation and that Vincam has
the right to terminate the Agreement immediately in accordance with the
provisions set forth in Termination, Section 10.
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6(C) WAGE AND HOUR LAWS. Because the Client Company controls the worksite
and the scheduling of the Worksite Employees, it agrees to obtain and accurately
report to Vincam the total number of hours worked by each Worksite Employee in
accordance with FLSA. If the Client Company fails to comply with the FLSA and
similar state laws or fails to disclose to Vincam a practice that results in an
employee not being paid for all time worked, this will be a material breach of
the Agreement, and the Agreement may be terminated in accordance with
Termination, Section 10. Failure of the Client Company to make the necessary
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corrections for a noted violation of the FLSA means that the Client Company
assumes all responsibility associated with the condition or violation.
6(D) PREVENTION OF THEFT, DESTRUCTION OF PROPERTY, ETC. The Client
Company is responsible for implementing and enforcing worksite procedures
necessary to prevent the misuse, destruction, misappropriation, theft, or
embezzlement of personal, real, or intellectual property of the Client Company
or its customers or clients.
6(E) WORKERS' COMPENSATION. To contain the cost of workers' compensation
insurance, the Client Company agrees to participate in a modified (or light)
duty program. The Client Company agrees that, during this Agreement, it will
not employ anyone outside the co-employment arrangement (e.g., non-Worksite
Employees) without Vincam's knowledge, except for independent contractors. The
Client Company agrees that, if it hires anyone outside the co-employment
arrangement (after having informed Vincam), it will obtain full workers'
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compensation coverage and name Vincam as a certificate holder. Under those
circumstances, the Client Company will provide Vincam with a certificate
reflecting the same and which contains a provision requiring the insurer to
notify Vincam in advance of any termination of coverage. The Client Company
agrees to require all independent contractors to provide evidence of workers'
compensation coverage before the contractor starts work at the worksite. (See
Section 5(C) for Vincam's responsibilities regarding workers' compensation).
6(F) COMPLIANCE WITH THE ADA AND OTHER COMPARABLE LAWS. Because the ADA
and comparable laws impose affirmative obligations on employers to provide a
reasonable accommodation to a qualified individual with a disability, UNLESS
THIS WOULD CAUSE AN UNDUE HARDSHIP, and to make a public facility accessible, IF
READILY ACHIEVABLE, the Client Company agrees that it will pay the costs
associated with complying with these laws. The Client Company acknowledges that
it, and not Vincam, assumes the responsibility for providing regulatory
compliance with Title III of the ADA (i.e., public access to facilities).
6(G) EMPLOYMENT TAXES. The Client Company agrees not to make any taxable
payment of any kind, except profit sharing or pension plan distributions
pursuant to the terms of a qualified plan, to any Worksite Employee without
Vincam's knowledge. This requirement is necessary because Vincam assumes the
responsibility under Vincam's Services and Responsibilities, Section 5(A) for
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complying with laws regarding the payment of wages. If the Client Company makes
such a payment, it has materially breached the Agreement which may not be
terminated in accordance with the provisions set forth in Termination, Section
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10.
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6(H) EMPLOYEE BENEFIT PLANS. The Client Company agrees and acknowledges
that it is not authorized to offer or continue any welfare benefit (e.g.,
medical, dental, life or disability, 401(k) plan, cafeteria plan, profit sharing
plan, or retirement plan) to any Worksite Employee without Vincam's knowledge
and prior written consent. The Client Company agrees to integrate and
coordinate any Client Company-sponsored benefit plans with those sponsored and
maintained by Vincam.
6(I) WORKSITE EMPLOYEES' PERFORMANCE; THE SUCCESS OF THE CLIENT COMPANY'S
BUSINESS. The Client Company acknowledges that Vincam does not guarantee the
Worksite Employees' performance because Vincam does not direct, supervise, or
control the day-to-day operations of the Client Company's business. If any law
requires a Worksite Employee to have or maintain a special license or be
supervised by a Worksite Employee with such a license, the Client Company will
ensure that the Worksite Employee is so licensed or supervised. The Client
Company will pay for the costs associated with obtaining such license. Further,
because the Client Company controls its business affairs, it acknowledges that
Vincam is not responsible for any loss of revenue, product, business, or injury
to the Client Company or a third party due to any act or omission of a Worksite
Employee.
6(J) INSURANCE. In recognition of the co-employment arrangement, the
Client Company agrees to maintain the types of insurance listed below with a
minimum combined single limit of One Million Dollars. The Client Company agrees
to provide Vincam with a copy of the insurance certificate regarding the
applicable insurance when requested. The Client
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Company agrees to inform Vincam immediately if any of the Client Company's
insurers materially modify the terms of the insurance discussed below, inform
the Client Company of a pending termination of coverage, or terminate coverage.
1) Automobile coverage for all vehicles used in connection with the
business, whether or not owned by the Client Company. Such insurance must also
cover public liability for bodily injury and property damage for each vehicle up
the above-stated limit and uninsured motorist or PIP equivalent coverage of at
least the minimum limits required by state law.
2) General liability coverage for the premises, operations, products,
completed operations, contract and broad form property damage, independent
contractors, personal injury with coverage for host liquor, dram shop, and full
liquor liability as applicable.
3) Professional licensing, malpractice, and/or liability coverage if the
Client Company renders professional services and provides services which require
employees to be licensed.
4) Any fidelity bond reasonably required because of the Client Company's
business.
6(K) THE NATIONAL LABOR RELATIONS ACT. The Client Company agrees to abide
by the National Labor Relations Act. Because the decision to operate as a union
or a non-union business is a core business decision belonging solely to the
Client Company, the Client Company is responsible for all decisions related to a
union organizing campaign, the negotiation of a collective bargaining agreement,
and the processing of grievances and arbitrations under the collective
bargaining agreement.
7. PAYMENT. The Client Company agrees to pay the amount specified in the
Pricing Attachment which amount will be invoiced in advance of the Client
Company's payroll dates. The Client Company agrees to pay Vincam's invoice no
later than forty-eight (48) hours before the Client Company's regularly
scheduled payroll. The Client Company agrees to pay through Automatic Clearing
House ("ACH") debit transfer or with a bank wire transfer. Any amount not paid
when due will be assessed a late charge of five (5) percent or the maximum
allowable by law. The payment of a late charge does not prevent a default under
this Agreement, or the enforcement of any remedies upon default including
termination of this Agreement as provided in the Termination, Section 10. The
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Client Company acknowledges that the price is subject to adjustment (i.e.,
upward or downward) on the anniversary date of the Effective Date, except that
the portion of Vincam's fee that relates to employee benefits will always adjust
in accordance with the benefit plan or insurance policy renewal or anniversary
date. Any change in price (exclusive of the employee benefits portion) will
remain fixed until the next anniversary date of the Effective Date.
Because of Vincam's obligation to pay the Worksite Employees, Vincam
retains the discretion to require the Client Company to give Vincam a deposit or
letter of credit in an amount equal to one invoice. If the Client Company
defaults on its payment obligation to Vincam, any deposit immediately becomes
Vincam's money or, if the Client Company provided a letter of credit, Vincam has
the immediate right to draw down on the letter in the amount of the default. On
each anniversary date of the Effective Date, Vincam will evaluate the Client
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Company's payment history and financial wherewithal to determine whether a
deposit should be obtained, the amount of deposit should be adjusted or be
returned to the Client Company, or, if applicable, if the letter of credit
should be canceled. When the Agreement is terminated, Vincam agrees to return
any unused deposit or cancel the letter of credit, if any. Vincam agrees to
maintain any deposit in an account segregated for that purpose, accruing an
interest rate as set forth in the Pricing Attachment. Because Vincam's
obligations to pay the Worksite Employees is derived from this Agreement, the
Client Company agrees that Vincam's only obligation is to pay the FLSA or state
minimum wage or salary required to any Worksite Employee where the Client
Company has breached the Agreement by failing to pay the invoice when due. None
of the remedies contained in this Section constitutes a waiver of any other
remedies available to Vincam in the event of a default of the Agreement.
8. INDEMNIFICATION. These Sections describe the scope of each party's
indemnification obligations. The parties agree that the indemnification
provision shall not be limited to claims, expenses, or liabilities of which one
of the parties is solely liable, but also applies to claims, expenses, or
liabilities for which the parties are jointly liable. In the event of joint
liability, if either party pays funds in connection with a claim, expense, or
liability which is subject to the indemnification provision in excess of its
prorate share, the other party will indemnify that party for the excess amounts.
Each party agrees to notify the other of any claim or judgment to which this
indemnification provision may apply. Further, the parties agree not to settle
any claim to which the indemnity provision may apply or in which we are both
named as defendants without the prior written consent of the other party, which
consent will not be unreasonably withheld. Each party's indemnification
obligation survives the termination or expiration of the Agreement.
8(A) SCOPE OF THE CLIENT COMPANY'S INDEMNIFICATION. The Client Company
agrees to indemnify, protect, defend, release, and hold Vincam, its parent,
subsidiaries, affiliates, employees, directors, officers, and agents harmless
from and against any and all liability, expenses (including attorneys' fees and
court costs), losses, and claims for damage of any nature whatsoever, whether
direct or indirect, as though expressly set forth and described herein, which
Vincam may incur, suffer, become liable for or which may be asserted against
Vincom arising from or in connection with (i) the Client Company's negligent,
fraudulent, willful, or reckless performance or nonperformance of any of its
responsibilities or obligations under this Agreement; (ii) any actions or
inactions of the Client Company's employees, officers, directors, agents, or
independent contractors, including, without limitation, negligence, errors or
omissions, tortious conduct, violation of any statue, law, or regulation, or
criminal or dishonest activity, while under the supervision, direction, or
control of the Client Company; (iii) the Client Company's noncompliance with any
of the responsibilities enumerated in Client Company's Responsibilities, Section
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6, to the extent that the Client Company has direction and control of such
-
responsibility; (iv) the Client Company's business, product, or service, claims
for defective products or services rendered at or produced by the operations at
the worksite, and the fiscal integrity of the Client Company; (v) any
negligence, tortious conduct, violation of statute, law, or regulation, criminal
or dishonest activity attributed to the Client Company; (vi) any claims based on
facts or circumstances relating to the Client Company's activities that occurred
or existed
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prior to the Effective Date; or (vii) the Client Company's failure to adhere to
Vincam's procedures or recommendations regarding employment practices.
8(B) SCOPE OF VINCAM'S INDEMNIFICATION. Vincam agrees to indemnify,
protect, defend, release, and hold the Client Company, its parent, subsidiaries,
affiliates, employees, directors, officers, and agents harmless from and against
any and all liability, expenses (including attorney's fees and court costs),
losses, and claims for damage of any nature whatsoever, whether direct or
indirect, as though expressly set forth and described herein, which the Client
Company may incur, suffer, become liable for or which may be asserted against
the Client Company arising from or in connection with (i) Vincam's negligent,
fraudulent, willful, or reckless performance or nonperformance of any of its
responsibilities or obligations under this Agreement; (ii) any actions or
inactions of any of Vincam's Corporate Employees, Vincam's officers or
directors, as well as agents or independent contractors engaged by Vincam,
including, without limitation, negligence, errors or omissions, tortious
conduct, violation of any statute, law, or regulation, criminal or dishonest
activity, while under the supervision, direction, or control of Vincam; (iii)
Vincam's noncompliance with any of the responsibilities enumerated in Vincam's
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Services and Responsibilities, Section 5 to the extent that Vincam has direction
----------------------------------------
and control of such responsibility; (iv) any negligence, tortious conduct,
violation of statute, law, or regulation, criminal or dishonest activity
attributed to Vincam, or (v) any claims based on facts or circumstances relating
to Vincam's activities that occurred or existed prior to the Effective Date.
9. MISCELLANEOUS PROVISIONS. 9(A) THE PARTIES' AUTHORITY TO EXECUTE THE
AGREEMENT. The parties represent that each is a legal entity authorized to
conduct business in the state where the services of this Agreement will be
performed and that the officers who sign on behalf of the party are duly
authorized to enter into this Agreement.
9(B) THE SCOPE OF THE CLIENT COMPANY'S AUTHORITY. The Client Company
cannot hold itself out as an agent of Vincam, directly or indirectly, and is not
authorized to bind Vincam in any fashion (either through representations or its
actions) unless such action is specifically authorized and ratified by Vincam in
writing.
9(C) ASSIGNMENT; THIRD PARTY RIGHTS. This Agreement is a personal
services contract and is not transferable or assignable by the Client Company
without Vincam's prior written consent. The Client Company cannot assign the
services of a Worksite Employee to anyone without Vincam's prior written consent
except as needed in the normal course of business. Vincam may, however, assign
this Agreement to any of its subsidiaries or affiliates without the prior
written consent of the Client Company. For purposes of this Agreement, a merger
of the Client Company will constitute a transfer which requires Vincam's prior
written consent. This Agreement is for the mutual benefit of the parties and
does not create rights of any kind in a third party.
9(D) INTEGRATION; MODIFICATION; WAIVER. This Agreement constitutes the
entire agreement between the parties regarding this subject matter and
supersedes any other agreement between them, whether oral or written. Any
modification to the Agreement must be in writing
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and signed by the party against which enforcement is to be sought. Failure by
either party to act when required or to claim a breach of any provision of this
Agreement will not be construed as a waiver of any subsequent breach.
9(E) MEDIATION AND ARBITRATION. If a dispute arises between the parties
relating to the terms of this Agreement, either party may inform the other by
giving written notice that it desires to have the dispute mediated by a mediator
selected in accordance with the procedures of the Federal Mediation and
Conciliation Service, or by a procedure as agreed by the parties to the dispute.
Once mediation is elected, the parties agree to allow a minimum of sixty (60)
calendar days to resolve the dispute through mediation. Any mediation hearing
shall be conducted in Miami, Florida, or any other location which is mutually
agreed to by the parties in writing. If the dispute is not resolved through
mediation, either party to the dispute may elect to arbitrate the dispute by
serving written notice upon the other within fifteen (15) calendar days after
the mediation. Once arbitration is elected, the dispute shall be resolved by a
committee of arbitrators (one appointed by Vincam, one appointed by Client
Company, and one appointed by the two so appointed). Any arbitration proceeding
conducted shall be conducted in Miami, Florida, pursuant to the Commercial
Arbitration Rules of the American Arbitration Association and using the Florida
Rules of Civil Procedure and the Florida Rules of Evidence.
9(F) REMEDIES NOT EXCLUSIVE; SEVERABILITY. The rights and remedies
provided by this Agreement are not exclusive. Vincam is entitled to any rights
or remedies created by law (whether currently existing or created in the future)
as well as those contained in this Agreement. Institution of an action to
collect payment of an amount in default at law or the obtaining of a judgment in
such action shall not be deemed to be an election of remedies by Vincam. Such
action will not prevent Vincam from pursuing other remedies available to it at
law or in equity. Should any part of this Agreement be held to be invalid or
unenforceable, the balance of this Agreement remains in force and stands as if
the unenforceable part did not exist.
9(G) GOVERNING LAW. This Agreement is governed by, and shall be construed
in accordance with, the laws of Florida, both substantive and remedial, without
reference to the choice of law principles. All suits and special proceedings
arising out of the Agreement must be brought in the courts in and for Dade
County, Florida, or the United States District Court for the Southern District
of Florida unless the parties agree to mediate or arbitrate as provided in
subsection 9(E) above. Each party agrees to the exercise of personal
jurisdiction by any court of competent jurisdiction described in the prior
sentences.
9(H) ATTORNEY'S FEES AND COSTS. In the event of any litigation arising
out of or related to this Agreement, the prevailing party shall be entitled to
an award of attorneys' fees and costs incurred at all trial and appellate
levels. Further, if any payments are not made when due and the payments are
collected by or through an attorney, the Client Company agrees to pay all
expenses and costs of collection, including attorney's fees and court costs.
9(I) ATTACHMENTS; COUNTERPARTS; NOTICE; CAPTIONS. Any attachments
described in this Agreement are specifically incorporated into and made a part
of this Agreement. This Agreement may be executed in two or more counterparts,
each of which will constitute an
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original but taken together constitutes an entire agreement. Any notice by this
Agreement shall be delivered to Vincam and to Client Company at the respective
address and person designated below. The captions in this Agreement are provided
for convenience only and are not part of the terms and conditions of this
Agreement.
9(J) SURVIVAL. No termination or expiration of this Agreement affects or
impairs the obligation, duties, indemnities, and liabilities of the Client
Company, or the rights of Vincam relating to any unpaid obligations. These
obligations, duties, indemnities, and liabilities shall not terminate or expire,
but rather survive such termination or expiration and continue in full force and
effect until the longer of (i) such time as all the obligations have been paid
in full, or (ii) such time as is expressly provided in this Agreement.
10. TERMINATION. This Agreement has an initial one (1) year term starting
on the Effective Date. During the first year, either party may terminate the
Agreement by giving thirty (30) days' written notice unless terminated for
Cause, as defined below. After the first year, the Agreement renews
automatically on its anniversary date for an additional year's term unless a
party provides the other with written notice of non-renewal not later than
thirty (30) days before the next anniversary date of the Effective Date. Either
party may terminate this Agreement at any time if there is Cause. Cause
includes, but is not limited to, non-payment when due of any amount payable
under this Agreement, a material violation of law, non-performance of any
obligation of this Agreement, breach of a material term of this Agreement, or
the Client Company's filing for relief under the Bankruptcy Code or seeking the
appointment of a receiver or trustee. Upon termination, Vincam shall have all
of the rights and remedies available under applicable law, whether in law or in
equity, including, but not limited to, and without further notice or demand to
the Client Company; (i) all obligations evidenced hereby, together with all
accrued but unpaid charges, shall immediately become due and payable and may be
collected forthwith, regardless of due date; (ii) to set off and deduct any
amount due under this Agreement form any account or deposit that the Client
Company may have with Vincam or other monies to which Vincam may be entitled
from the Client Company (including pursuant to a draw on a letter of credit);
(iii) to institute legal proceedings against the Client Company, and any other
individual or entity which may be primarily or secondarily liable under this
Agreement, to collect any amounts owed under this Agreement; and (iv) to declare
all other obligations of the Client Company to Vincam to be immediately due and
payable. Interest shall accrue on any outstanding balance of the obligations
due under this Agreement from the date of any default hereunder and for so long
as such default continues at the highest default rate allowable under applicable
law.
10(A) EFFECT OF TERMINATION OF THE AGREEMENT ON THE WORKSITE EMPLOYEES;
THE PARTIES' OBLIGATIONS UPON TERMINATION. Upon termination of the Agreement,
the co-employment arrangement ends. If the termination is for any reason other
than the Client Company's breach, including for non-payment, the Client Company
has the right to offer continued employment to the former Worksite Employees.
If the Client Company rejects any person, Vincam has the right to offer
continued employment and to reassign that individual to another worksite. If
the termination is because the Client Company breached the Agreement, including
for non-payment, Vincam has the first right to offer continued employment and to
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reassign the former Worksite Employees. Upon termination of the Agreement, the
Worksite Employees are no longer employees of Vincam unless Vincam has offered
continued employment. Vincam will communicate the change in employment status
to the employees in writing. Vincam will cause the termination of all policies
and/or endorsements covering the Client Company and the Worksite Employees. At
the termination, the Client Company becomes responsible for payroll, workers'
compensation, employee benefits, etc., for the employees. The Client Company
agrees to pay Vincam immediately an amount for any unused, accrued paid time off
(e.g., vacation, sick, personal days) to which any Worksite Employee is entitled
upon the termination of the Agreement. If the Client Company terminates the
Agreement or breaches it, the Client Company is solely responsible for obtaining
replacement health care coverage for the Worksite Employees. If the Client
Company fails to obtain replacement health insurance (or comparable) coverage
for the Worksite Employees, the Client Company shall immediately pay Vincam a
fee of $500 per worker which cannot be used as an offset against any fee due
Vincam or any money due to Worksite Employees. The Client Company acknowledges
that this amount is reasonable to cover Vincam's expense in extending continued
health care coverage to the Worksite Employees and that this amount is not a
penalty. The Client Company further agrees that the payment of this sum does
not constitute an election of remedies and that Vincam may obtain money damages
for a breach of the Agreement in addition to this amount. Vincam agrees to
assist the Client Company during the transaction period by giving the Client
Company information regarding workers' compensation coverage, the health
insurance plans and other benefits, and the carryover balances (such as accrued
vacation). Vincam is not obligated to provide this information if the
termination of the Agreement is because the Client Company failed to pay Vincam.
11. THE LEGAL DEFENSE BENEFIT. Even in the absence of wrongdoing,
employers can be sued. Because of that possibility and Vincam's belief in its
services, Vincam provides the Client Company the legal defense benefit. This
benefit is not additional indemnification; it is not to be used as a fund to
--- ---
settle disputes between the Client Company, Vincam, and a Worksite Employee
(former or current). This is a "value-added" benefit for which the Client
Company pays no additional fee. It is Vincam's promise to pay up to $75,000 in
attorney's fees under the circumstances described below.
11(A) CONDITIONS RELATED TO OBTAIN THE LEGAL DEFENSE BENEFIT. To obtain a
legal defense benefit, the Client Company must fulfill all of the following
requirements for the particular claim: 1) comply with applicable law, 2)
observe Vincam's procedures for employment practices (both in general and for
that worksite), 3) follow Vincam's recommendation(s) regarding the incident from
which the claim arose, 4) use only Vincam-provided forms, 5) comply with this
Agreement, and 6) permit Vincam to exercise its responsibilities pursuant to law
and this Agreement. To obtain this benefit, the Client Company agrees to accept
Vincam's choice of counsel. If the Client Company prefers to select its own
counsel, it is free to do so. In that event, this benefit is not available to
cover the legal fees associated with that retention. If there is a conflict
between the Client Company and Vincam, this benefit is not available.
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11(B) SCOPE OF THE LEGAL DEFENSE BENEFIT. If the Client Company fulfills
the above requirements, Vincam will pay up to $75,000 for attorney's fees to
cover any employment practices claim filed under one of the laws enumerated in
Vincam's Services and Responsibilities, Section 5, between a Worksite Employee
-------------------------------------------------
and the Client Company, Vincam, or both while this Agreement is in effect.
Specifically excluded are third party liability claims of any kind, including,
but not limited to, those arising from automobile accidents and/or personal
injury litigation. The legal fees for this benefit will be based on the hourly
rate that the law firm selected by Vincam charges Vincam.
12. VINCAM'S SERVICE GUARANTEE. Vincam is confident about the quality of
its services. As a result, we make the following guarantee: if the Client
Company is not satisfied with Vincam's services and the Client Company wishes to
terminate the Agreement within the first six months of the initial Effective
Date, Vincam will refund all fees the Client Company paid Vincam excluding
wages, direct expenses, payroll taxes, employee benefits, workers' compensation
costs, and other mandatory insurance (e.g., State Unemployment Insurance).
Vincam will provide, at no cost, assistance to the Client Company so that it may
resume full employer responsibilities. This assistance includes giving the
Client Company information necessary to obtain workers' compensation coverage,
health insurance plans and other benefits, arranging for payroll service, and
furnishing all carryover balances (such as accrued vacation). This benefit is
not available if the Client Company breaches the Agreement, including failure to
pay.
13. EMPLOYMENT PRACTICES LIABILITY (EPL) INSURANCE. Vincam has purchased
an EPL insurance policy with an endorsement that extends coverage to the Client
Company for claims brought by a Workplace Employee against the Client Company
alleging wrongful employment practices, as defined in the policy. The Client
Company's coverage is subject to annual aggregate limits and a deductible, among
other terms and conditions contained in the policy. A copy of the policy may be
obtained from our EPL carrier.
Vincam and the Client Company execute this Agreement, in their respective
corporate names by their duly authorized officers, on the 25th day of February,
1999.
INTELLIGENT LIFE CORP. VINCAM HUMAN RESOURCES, INC.
By: /s/ Xxxxx X. Xxxxxxx By: /s/ Xxxx X. Xxxxxxx
-------------------------- -----------------------------
Name: Xxxxx X. Xxxxxxx Name: Xxxx X. Xxxxxxx
------------------------ --------------------------
Title: S. V. P. Title: President
--------------------- ------------------------
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ADDENDUM
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Access to Personnel Files
At all times during the term of this Agreement, Client Company shall have
access to all personnel files of Worksite Employees and shall have the right, at
Client Company's expense, to make copies of any and all materials contained in
said files.
PRICING ATTACHMENT
VINCAM HUMAN RESOURCES, INC.
CLIENT SERVICES & CO-EMPLOYMENT AGREEMENT FOR
BANK RATE MONITOR
WORKER'S COMP CURRENT CURRENT CURRENT PROPOSED NEW PROPOSED NEW
CODE PAYROLL SERVICE FEE COSTS SERVICE FEE COSTS
CA8810 $ 8,323 117.11% $ 9,748 115.61% $ 9,623
8742 $ 17,500 114.88% $ 20,104 112.88% $ 19,754
8810 $312,274 114.40% $357,236 112.40% $350,990
IL8810 $ 6,250 116.36% $ 7,273 114.86% $ 7,179
NJ8810 $ 6,667 117.74% $ 7,850 116.24% $ 7,750
VINCAM'S PERCENTAGE OF GROSS PAYROLL WILL DECREASE PROPORTIONALLY WHEN
EMPLOYEES REACH LIMITS FOR PAYROLL TAXES AS PRESCRIBED BY LAW.
FEES:
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(1) Vincam's percentage of gross payroll will decrease proportionately when
employees reach the limits for payroll taxes as prescribed by law. Vincam
agrees that it will only charge 1.45% (FICA-Medicare) for any employee that
exceeds the FICA-Social Security wage limits.
(2) The Client Company will be charged a fee of $20 for each newly hired
employee and $10 for each rehired employee who has been terminated for more
than 30 days.
(3) The Client Company will be charged $30 per employee, as a replacement fee,
for each lost/stolen payroll check.
(4) Vincam charges $12 for each site where payroll checks and/or reports are
delivered.
OPTIONAL SERVICE AND FEES
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Vincam will offer participation in a 401(k) retirement saving plan and will
test on a periodic basis to ensure that contributions made by highly
compensated employees do not exceed levels established by federal law. Vincam
does not require a minimum contribution from the Client Company. There is NO
CHARGE for set-up of the 401(k) or an annual maintenance fee thereafter.
Individual employees will be assessed a 401(k) account service fee of $23.50
per year.
