Connecticut Consumers Encounter a Rare Bird - the National Association of Professional Employer Organizations, a Trade Association That Wants More Regulation, Not Less.

HARTFORD, Conn. -- Every year con artists dream up new ways to scam Connecticut consumers: An elderly woman loses $43,000 to sweepstakes promotions; an entire town government has its long-distance telephone service switched without its permission.

Professional employer organizations can't do much about those scams, but they can help ensure their own industry, which has long operated in Connecticut without problems, stays that way.

PEOs, as they're called, support a bill to tighten regulation of the industry. A state legislative committee holds a hearing Thursday.

Small businesses hire PEOs to administer time-consuming, complicated human resource tasks such as doing payroll.

PEOs also enable small businesses to offer big-business benefits such as a 401(k) and health plan.

But PEOs handle lots of money; a few miscreants in other states - mostly those states without regulations - have gone under or been charged with fraud, in some cases devastating workers who suddenly find their medical bills no longer covered by insurance.

This bill requires PEOs to register with the Department of Consumer Protection and file audited financial statements. In return, the industry gets the legal certainty it needs to continue growing.

And that's important because PEOs help workers at small businesses get health benefits; almost 400,000 residents went without them in 2005, says the Connecticut Health Policy Project.

Service jobs are growing two-thirds faster than the rest of Connecticut's economy, and these jobs are much less likely to offer heath plans. Connecticut spent more than $100 million in 2005 on Medicaid reimbursements to hospitals treating the underinsured and uninsured.

Connecticut also has an unusually large number of workplace injuries, according to the Occupational Safety and Health Administration. More than 74,000 workers got hurt on the job in 2005, up a startling 10 percent. PEOs help small companies comply with safety regulations.

"This is not a business-versus-consumer issue," said Milan P. Yager, executive vice president of the National Association of Professional Employer Organizations, or NAPEO. "This is one of those rare legislative issues where everybody wins."

NAPEO has helped pass similar legislation in more than two dozen states.