8 unchanged sentences
Our PEO services are billed as a percentage of client payroll;
−Removed: the gross amount invoiced includes direct payroll costs plus an additional percentage amount to cover employer payroll-related taxes, workers’ compensation coverage (if provided), other service-related costs and a margin.
+Added: the gross amount invoiced includes direct payroll costs and employee benefits coverage (if provided), plus an additional percentage amount to cover employer payroll-related taxes, workers’ compensation coverage (if provided), other service-related costs and a margin.
However, actual costs can be higher or lower than anticipated.
3 unchanged sentences
For staffing services other than direct placement, invoiced amounts include direct payroll, an amount intended to cover employer payroll-related taxes, workers’ compensation coverage, other service-related costs and a margin.
−Removed: Staffing customers are invoiced weekly and typically have payment terms of 30 days.
+Added: Staffing customers are typically invoiced weekly and generally have payment terms of 30 days.
Direct placement services are billed at agreed fees at the time of a successful placement.
Our business is concentrated in California, and we expect to continue to derive a majority of our revenues from this market in the future.
−Removed: Revenues generated in our California operations accounted for 72% of our total revenues in 2024, 72% in 2023 and 73% in 2022.
+Added: Revenues generated in our California operations accounted for 72% of our total revenues in each of 2025, 2024 and 2023.
Consequently, weakness in economic conditions, changes in the regulatory or insurance environment, or natural disasters or other major disruptive events in California could have a material adverse effect on our financial results.
2 unchanged sentences
Direct payroll costs represent the gross payroll earned by staffing services employees based on salary or hourly wages.
−Removed: Payroll taxes and benefits consist of the employer’s portion of Social Security and Medicare taxes, federal and state unemployment taxes, and employee benefit costs, which primarily comprises health insurance premiums paid to third-party insurers and underwriting and benefit consultant payroll.
−Removed: Workers’ compensation costs consist primarily of premiums paid to third-party insurers, claims reserves, claims administration fees, legal fees, medical cost containment (“MCC”) expense, state administrative agency fees, third-party broker commissions, and risk manager payroll, as well as costs associated with operating our two wholly owned insurance companies, Associated Insurance Company for Excess (“AICE”) and Ecole Insurance Company (“Ecole”).
+Added: Payroll taxes and benefits consist of the employer’s portion of Social Security and Medicare taxes, federal and state unemployment taxes, and employee benefit costs, which primarily comprise health insurance premiums paid to third-party insurers and underwriting and benefit consultant payroll.
+Added: Workers’ compensation costs consist primarily of premiums paid to third-party insurers, claims reserves, third-party broker commissions, risk manager payroll, claims administration fees, legal fees, medical cost containment (“MCC”) expense, state administrative agency fees, as well as costs associated with operating our two wholly owned insurance companies, Associated Insurance Company for Excess (“AICE”) and Ecole Insurance Company (“Ecole”).
Selling, general and administrative expenses consist primarily of payroll and personnel related costs, incentive compensation, information systems costs, rent and professional and legal fees.
−Removed: Depreciation and amortization represent depreciation of property and equipment, leasehold improvements, software and internally developed software costs.
−Removed: Property, equipment, software and internally developed software costs are depreciated using the straight-line method over their estimated useful lives, which range from 3 to 39 years.
+Added: Depreciation and amortization represent depreciation of property and equipment, leasehold improvements and internally developed software costs.
+Added: Property, equipment and internally developed software costs are depreciated using the straight-line method over their estimated useful lives, which range from 3 to 39 years.
Leasehold improvements are amortized using the straight-line method over the shorter of the lease term or estimated useful life.
6 unchanged sentences
Workers' Compensation Costs
−Removed: For all claims incurred under the Company’s workers’ compensation programs, we record an estimate for the total amount of workers’ compensation costs, which represents the amount necessary to pay claims and related expenses, including premiums to third-party insurers, with respect to workplace injuries that have occurred under our various workers’ compensation insurance programs.
+Added: Under the Company’s workers’ compensation programs, we estimate ultimate losses, which represent the amount necessary to pay claims and related expenses associated with workplace injuries that have occurred under the programs.
When a claim involving a probable loss is reported, our independent third-party administrator for workers’ compensation claims (“TPA”) establishes a case reserve for the estimated amount of ultimate loss.
8 unchanged sentences
The process of estimating claims and claims adjustment expense involves a high degree of judgment and is affected by both internal and external events, including changes in claims handling practices, modifications in reserve estimation procedures, changes in individuals involved in the reserve estimation process, inflation, trends in the litigation and settlement of pending claims, and legislative changes.
−Removed: Our estimates are based on actuarial analyses and informed judgment, derived from individual experiences and expertise applied to multiple sets of data and analyses.
+Added: Our estimates are based on actuarial analyses and informed judgment, derived from individual experience and expertise applied to multiple sets of data and analyses.
We consider significant facts and circumstances known both at the time that loss reserves are initially established and as new facts and circumstances become known.
5 unchanged sentences
Actuaries exercise a considerable degree of judgment in the evaluation of these factors and the need for such actuarial judgment is more pronounced when faced with material uncertainties.
−Removed: To illustrate the sensitivity of changes in our estimate of workers’ compensation costs, a 5% increase in estimated ultimate losses for 2024 would result in a $0.5 million increase in workers’ compensation expense, and a 5% decrease in estimated ultimate losses would result in a $7.1 million decrease to workers’ compensation expense.
−Removed: This asymmetric impact on workers’ compensation expense is due to our insured program, which limits our expense if claim costs increase but passes through savings if claim costs are lower than expected.
+Added: For claims incurred under the Company's self-insured programs, we record reserves equal to our estimate of the ultimate losses up to the retention limit, reduced by claim payments made.
+Added: Third-party insurers assume substantially all risk of loss for claims incurred under the Company's fully insured arrangement.
+Added: However, the Company's fully insured policies allow for return premiums if claims develop favorably, ranging from $20.0 million to $30.0 million depending on the policy period.
+Added: For the policy period beginning July 1, 2021, BBSI can incur additional premiums up to $7.5 million if claims develop adversely.
+Added: For all other policy years, no additional premiums can be charged based on claim performance.
+Added: Our estimate of the losses associated with claims incurred under the fully insured policies directly impacts our estimate of the return premiums we may realize or the additional premiums that we may incur.
+Added: The estimate we recorded for workers’ compensation costs was reduced by $18.7 million and $18.5 million in 2025 and 2024, respectively, due to changes in estimated losses for prior accident years.
We believe that the amounts that we have recorded for our estimated workers’ compensation costs are reasonable.
Nevertheless, adjustments to such estimates will be required in future periods if the development of claim costs varies materially from our estimates, and such future adjustments may be material to our results of operations.
+Added: To illustrate the sensitivity of changes in our estimate of workers’ compensation costs, a 5% increase in estimated ultimate losses for the 2025 accident year would result in a $0.6 million increase in workers’ compensation expense, and a 5% decrease in estimated ultimate losses for the 2025 accident year would result in a $7.5 million decrease to workers’ compensation expense.
+Added: This asymmetric impact on workers’ compensation expense is due to our insured program, which limits our expense if claim costs increase but passes through savings if claim costs are lower than expected.
Recent Accounting Pronouncements
1 unchanged sentence
Forward-Looking Information
−Removed: Statements in this Item or in Items 1, 1A, 3 and 9A of this report include forward-looking statements, which are not historical in nature and are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.
+Added: Statements in this Annual Report on Form 10-K include forward-looking statements, which are not historical in nature and are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.
These forward-looking statements include, among others, discussion of economic conditions in our market areas, especially in California, and their effect on revenue levels;
3 unchanged sentences
the effect of changes in our mix of services on gross margin;
−Removed: labor market conditions;
+Added: labor market conditions, including the impact of AI and automation on workplace displacement;
the adequacy of our workers' compensation reserves;
8 unchanged sentences
litigation costs;
−Removed: the effect of changes in the interest rate environment on the value of our investment securities;
+Added: the effect of inflationary pressures or changes in the interest rate environment on the value of our investment securities;
the adequacy of our allowance for expected credit losses;
2 unchanged sentences
Such factors with respect to the Company include:
−Removed: our ability to retain current clients and attract new clients;
+Added: our ability to retain current clients and
+Added: attract new clients;
+Added: technology disruption, including the displacement of employees through the adoption of AI and automation by our clients;
difficulties associated with integrating clients into our operations;
−Removed: economic trends in our service areas and the potential effects of changing governmental policies and natural disasters;
+Added: economic trends in our service areas and the potential effects of changing governmental policies, including those related to immigration, tariffs, other trade policies, or climate regulation;
+Added: risks to our business and the business of our clients arising from current or future tariffs or other trade restrictions, supply chain issues, changes in labor force, or geopolitical instability, including the war in Ukraine, conflicts in the Middle East, and the potential for future conflicts or disruptions in other parts of the world;
+Added: natural disasters;
the potential for material deviations from expected future workers’ compensation claims experience;
8 unchanged sentences
the impact of and potential changes to the Patient Protection and Affordable Care Act, escalating medical costs, and other health care legislative initiatives on our business;
−Removed: the effect of changing interest rates and conditions in the global capital markets on our investment portfolio;
+Added: the effect of changing monetary policy, interest rates and conditions in the global capital markets on our investment portfolio;
and the availability of capital, borrowing capacity on our revolving credit facility, or letters of credit necessary to meet state-mandated surety deposit requirements for maintaining our status as a qualified self-insured employer for workers' compensation coverage or our insured program.
−Removed: Additional risk factors affecting our business are discussed in Item 1A
−Removed: of Part I of this report.
+Added: Additional risk factors affecting our business are discussed in Item 1A of Part I of this report.
We disclaim any obligation to publicly announce any revisions to any of the forward-looking statements contained herein to reflect future events or developments.
40 unchanged sentences
Revenue for 2025 totaled $1,240.3 million, an increase of $95.8 million or 8.4% over 2024, which reflects an increase in the Company’s PEO service revenue of $104.9 million or 9.9% and a decrease in staffing services revenue of $9.2 million or 11.3%.
−Removed: The increase in PEO services revenues was primarily attributable to a 4.2% increase in average number of WSEs as well as a 3.4% increase in average billing per WSE.
+Added: The increase in PEO services revenues was primarily attributable to a 6.7% increase in average number of WSEs as well as a 2.4% increase in average billing per WSE per day.
Gross margin for 2025 totaled $260.9 million or 21.0% of revenue compared to $253.3 million or 22.2% of revenue for 2024.
5 unchanged sentences
Workers’ compensation expense for 2025 totaled $204.1 million or 16.5% of revenue compared to $201.7 million or 17.6% of revenue for 2024.
−Removed: The decrease in workers’ compensation expense as a percentage of revenue was primarily due to lower workers' compensation costs in the current year as well as favorable prior year liability and premium adjustments of $18.5 million in 2024, compared to prior year liability and premium adjustments of $14.9 million in 2023.
+Added: The decrease in workers’ compensation expense as a percentage of revenue was primarily due to lower workers' compensation costs in the current year, which included favorable prior year liability and premium adjustments of $18.7 million in 2025, compared to favorable prior year liability and premium adjustments of $18.5 million in 2024.
Selling, general and administrative (“SG&A”) expenses for 2025 totaled $190.5 million or 15.4% of revenue compared to $185.9 million or 16.2% of revenue for 2024.
−Removed: The increase of $11.1 million in SG&A expense was primarily attributable to increased employee-related costs, including increased variable employee compensation and incentive pay related to stronger financial results compared to 2023.
+Added: The increase of $4.6 million in SG&A expense was primarily attributable to increased employee-related costs.
Other income, net for 2025 totaled $9.2 million compared to other income of $11.0 million for 2024.
−Removed: The increase was primarily attributable to an increase in investment income in 2024.
+Added: The decrease was primarily attributable to a decrease in investment income in 2025.
Our effective income tax rate for 2025 was 23.7% compared to 25.2% for 2024.
2 unchanged sentences
A discussion of our financial condition and results of operations for 2024 compared to 2023 can be found in Part II, Item 7.
−Removed: Management's Discussion and Analysis in our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on March 1, 2024.
+Added: Management's Discussion and Analysis in our Annual Report on Form 10-K for the year ended December 31, 2024, filed with the SEC on February 28, 2025.
Fluctuations in Quarterly Operating Results
7 unchanged sentences
Liquidity and Capital Resources
−Removed: The Company's cash balance of $82.6 million, which includes cash, cash equivalents, and restricted cash, increased $7.7 million for the twelve months ended December 31, 2024, compared to a decrease of $32.5 million for the comparable period of 2023.
−Removed: The increase in cash at December 31, 2024 as compared to December 31, 2023 was primarily due to proceeds from the sale and maturities of investments and restricted investments, increased accrued payroll and related benefits, and net income, partially offset by increased trade accounts receivable, decreased workers' compensation claim liabilities, purchases of investments and restricted investments, and repurchases of common stock.
−Removed: Net cash provided by operating activities in 2024 amounted to $10.1 million, compared to net cash provided of $67.2 million for the comparable period of 2023.
−Removed: In 2024, net cash provided by operating activities was primarily due to increased accrued payroll and related benefits of $55.2 million and net income of $53.0 million, largely offset by increased trade accounts receivable of $63.1 million and decreased workers’ compensation claims liabilities of $39.4 million.
−Removed: Net cash provided by investing activities totaled $38.8 million in 2024, compared to net cash used of $55.2 million for the comparable period of 2023.
+Added: The Company's cash balance of $126.3 million at December 31, 2025, which includes cash, cash equivalents, and restricted cash, increased $43.7 million for the twelve months ended December 31, 2025, compared to the cash balance of $82.6 million at December 31, 2024, with an increase of $7.7 million compared to 2024.
+Added: The increase in cash at December 31, 2025 as compared to December 31, 2024 was primarily due to the factors discussed below.
+Added: Net cash provided by operating activities in 2025 amounted to $66.0 million, compared to net cash provided by operating activities of $10.1 million for the comparable period of 2024.
+Added: In 2025, net cash provided by operating activities was primarily due to net income of $54.4 million, increased accrued payroll and related benefits of $22.6 million, increased payroll taxes payable of $12.8 million, share-based compensation of $10.4 million, increased other accrued liabilities of $8.8 million and depreciation and amortization of $8.3 million, partially offset by decreased workers’ compensation claims liabilities of $23.6 million, decreased premium payable of $16.0 million and increased trade accounts receivable of $14.1 million.
+Added: Net cash provided by investing activities totaled $30.8 million in 2025, compared to net cash provided by investing activities of $38.8 million for the comparable period of 2024.
In 2025, net cash provided by investing activities consisted primarily of proceeds from the sale and maturity of investments and restricted investments of $93.6 million, partially offset by the purchases of investments and restricted investments of $44.0 million and the purchase of property, equipment and software of $18.8 million.
−Removed: Net cash used in financing activities in 2024 was $41.1 million compared to net cash used of $44.6 million for the comparable period of 2023.
+Added: Net cash used in financing activities in 2025 was $53.0 million compared to net cash used in financing activities of $41.1 million for the comparable period of 2024.
In 2025, net cash used in financing activities primarily consisted of repurchases of common stock of $42.0 million and dividend payments of $8.2 million.
2 unchanged sentences
The trust account balance is included as a component of the current and long-term restricted cash and investments in the Company’s consolidated balance sheets.
−Removed: See “Note 5 - Revolving Credit Facility and Long-Term Debt” to the consolidated financial statements included in Item 8 of Part II of this report for information regarding the Company’s credit agreement with Wells Fargo Bank, N.A.
+Added: See “Note 5 - Revolving Credit Facility” to the consolidated financial statements included in Item 8 of Part II of this report for information regarding the Company’s credit agreement with Wells Fargo Bank, N.A.
Contractual Obligations
5 unchanged sentences
Total contractual obligations
−Removed: (1) As of December 31, 2024, the Company has additional operating leases that have not yet commenced of $7.1 million and remaining balances on short-term operating leases of $0.06 million, included in the table above.
−Removed: In January 2022, the Company paid off all of its long-term debt.
+Added: (1) As of December 31, 2025, the Company had no additional operating leases that have not yet commenced and remaining balances on short-term operating leases of $0.2 million, included in the table above.
+Added: The Company has no long-term debt obligations as of December 31, 2025.
QUANTITATIVE AND QUALITAT IVE DISCLOSURES ABOUT MARKET RISK
12 unchanged sentences
We have audited the accompanying consolidated balance sheets of Barrett Business Services, Inc.
−Removed: and subsidiaries (the “Company”) as of December 31, 2024 and December 31, 2023, the related consolidated statements of operations, comprehensive income, stockholders' equity, and cash flows, for each of the three years in the period ended December 31, 2024, and the related notes (collectively referred to as the "financial statements").
−Removed: In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and December 31, 2023, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2024, in conformity with accounting principles generally accepted in the United States of America.
+Added: and subsidiaries (the “Company”) as of December 31, 2025 and 2024, the related consolidated statements of operations, comprehensive income, stockholders' equity, and cash flows, for each of the three years in the period ended December 31, 2025, and the related notes (collectively referred to as the "financial statements").
+Added: In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America.
We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 25, 2026 , expressed an unqualified opinion on the Company's internal control over financial reporting.
11 unchanged sentences
Critical Audit Matter
−Removed: The critical audit matters communicated below are matters arising from the current-period audit of the financial statements that were communicated or required to be communicated to the audit committee and that (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.
−Removed: The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.
−Removed: Workers' Compensation Claims Liabilities
−Removed: Workers’ compensation claims liabilities represent management’s estimate of future obligation amounts under workers’ compensation programs where the Company retains the risk.
+Added: The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.
+Added: The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
+Added: Workers’ Compensation Costs
+Added: Under the Company’s workers’ compensation programs management estimates ultimate losses, which represent the amount necessary to pay claims and related expenses associated with workplace injuries that have occurred under the programs.
These estimates utilize actuarial expertise and projection techniques at a given reporting date, and are based on an evaluation of information provided by the Company’s third-party administrator for workers’ compensation claims, coupled with an actuarial estimate of future loss development with respect to reported claims and incurred but not reported claims (together, “IBNR”).
The Company’s estimates are based on actuarial analysis and informed judgment, derived from individual experience and expertise applied to multiple sets of data and analyses.
−Removed: The Company considers significant facts and circumstances known both at the time that loss reserves are initially established, and as new facts and circumstances become known.
−Removed: Given the subjectivity of estimating future loss development with respect to reported claims and incurred but not reported claims, the related audit procedures to evaluate the workers’ compensation claims liabilities required a high degree of auditor judgment and an increased extent of effort, including involvement of our actuarial specialists.
+Added: The Company considers significant facts and circumstances known both at the time that loss estimates are initially established, and as new facts and circumstances become known.
+Added: Given the subjectivity of estimating future loss development with respect to reported claims and incurred but not reported claims, the related audit procedures to evaluate the ultimate incurred losses required a high degree of auditor judgment and an increased extent of effort, including involvement of our actuarial specialists.
+Added: For claims incurred under the Company’s self-insured programs, the Company records reserves equal to their estimate of the ultimate losses up to the retention limit, reduced by claim payments made.
+Added: The Company’s fully insured policies allow for return premiums if claims develop favorably, ranging from $20.0 million to $30.0 million, depending on the policy period.
+Added: For the policy period beginning July 1, 2021, the Company can incur additional premiums up to $7.5 million if claims develop adversely.
+Added: For all other policy years, no additional premiums can be charged based on claim performance.
+Added: The estimate of the losses associated with claims incurred under the fully insured policies directly impacts the estimate of the return premiums the Company may realize or the additional premiums that they may incur.
How the Critical Audit Matter Was Addressed in the Audit
−Removed: Our audit procedures related to the workers’ compensation claims liabilities included the following:
−Removed: • We tested the effectiveness of controls related to the workers’ compensation claims liabilities, including those involving management’s estimates and ultimate loss projections.
−Removed: • We tested the underlying data that served as the basis for the actuarial analysis, including historical claims, to test that the inputs to the actuarial estimate were complete and accurate.
−Removed: • With the assistance of our actuarial specialists, we evaluated the methods and assumptions used by management to estimate the workers’ compensation claims liabilities by:
−Removed: o Performing a retrospective review, including comparing management’s prior year estimates of expected incurred losses to actual experience during the current year, to identify potential bias in the determination of the workers’ compensation claims liabilities.
−Removed: o Developing a range of independent estimates of the workers’ compensation claims liabilities, and comparing our estimated ranges to management’s estimates and assessed the consistency of management’s approach.
−Removed: /s/ Meghann Hartley
+Added: Our audit procedures related to the ultimate loss estimates included the following:
+Added: • We tested the effectiveness of controls related to the workers’ compensation costs, including those involving management’s estimates and ultimate loss projections.
+Added: • We tested the underlying data inputs that served as the basis for the actuarial analysis, including historical claims, for completeness and accuracy.
+Added: • With the assistance of our actuarial specialists, we evaluated the methods and assumptions used by management to estimate the ultimate losses by:
+Added: o Performing a retrospective review, including comparing management’s prior year estimates of expected incurred losses to actual experience during the current year, to identify potential bias in the determination of the ultimate losses.
+Added: o Developing a range of independent estimates of the ultimate losses, and comparing our estimated ranges to management’s estimates and assessed the consistency of management’s approach.
+Added: /s/ Deloitte & Touche LLP
Portland , Oregon
41 unchanged sentences
Total liabilities and stockholders' equity
−Removed: (1) Prior period results have been adjusted to reflect the four -for-one stock split effected in the form of a stock dividend in June 2024.
−Removed: See the Business section in Item 1 of Part I of this report for details.
The accompanying notes are an integral part of these consolidated financial statements.
24 unchanged sentences
Weighted average number of diluted common shares outstanding
−Removed: (1) Prior period results have been adjusted to reflect the four -for-one stock split effected in the form of a stock dividend in June 2024.
−Removed: See the Business section in Item 1 of Part I of this report for details.
The accompanying notes are an integral part of these consolidated financial statements.
3 unchanged sentences
(In Thousands)
−Removed: Unrealized gains (losses) on investments, net of tax of $ 595 , $ 2,596 , and ($ 10,958 ) in 2024, 2023 and 2022, respectively
+Added: Unrealized gains on investments, net of tax of $ 2,910 , $ 595 , and $ 2,596 in 2025, 2024 and 2023, respectively
Comprehensive income
14 unchanged sentences
Cash dividends on common stock ($ 0.30
−Removed: Unrealized loss on investments, net of tax
+Added: Unrealized gain on investments, net of tax
Balance, December 31, 2023
19 unchanged sentences
Balance, December 31, 2025
−Removed: (1) Prior period results have been adjusted to reflect the four -for-one stock split effected in the form of a stock dividend in June 2024.
−Removed: See the Business section in Item 1 of Part I of this report for details.
The accompanying notes are an integral part of these consolidated financial statements.
7 unchanged sentences
Non-cash operating lease expense
−Removed: Investment (accretion) amortization and (gains) losses recognized
+Added: Investment amortization (accretion) and losses (gains) recognized
Losses recognized on disposal of property and equipment
24 unchanged sentences
Payments on credit-line borrowings
−Removed: Payments on long-term debt
Repurchase of common stock
−Removed: Common stock repurchased on vesting of stock awards
+Added: Common stock repurchased on vesting of restricted stock units
+Added: and performance awards
Dividends paid
15 unchanged sentences
The Company supports clients with a local presence in 69 markets throughout the United States.
−Removed: Approximately 72 %, 72 % and 73 %, respectively, of our revenue during 2024, 2023 and 2022 was attributable to our California operations.
+Added: Approximately 72 % of our revenue during each of 2025, 2024 and 2023 was attributable to our California operations.
BBSI was incorporated in Maryland in 1965.
5 unchanged sentences
All intercompany account balances and transactions between BBSI, AICE, and Ecole have been eliminated in consolidation.
−Removed: Common stock split
−Removed: On June 4, 2024, we amended our Charter to increase the number of authorized shares of common stock from 20,500,000 shares to 82,000,000 shares, and our Board of Directors declared a four -for-one split of the Company’s common stock effected in the form of a stock dividend (the “2024 Stock Split”).
−Removed: Each stockholder of record at the close of business on June 14, 2024 received a dividend of three additional shares of common stock for each then-held share, distributed after close of trading on June 21, 2024.
−Removed: All share and per share amounts presented herein have been retroactively adjusted to reflect the impact of the 2024 Stock Split.
−Removed: The shares of common stock retain a par value of $ 0.01 per share.
−Removed: Accordingly, an amount equal to the par value of the increased shares resulting from the stock split was reclassified from additional paid-in capital to common stock.
Reportable segment
11 unchanged sentences
In addition, our client service agreements provide for immediate termination upon any payment default of the client regardless of when notice is given.
−Removed: PEO customers are invoiced following the end of each payroll processing cycle, with payment generally due on the invoice date.
+Added: PEO customers are invoiced following the end of each payroll
+Added: processing cycle, with payment generally due on the invoice date.
Staffing customers are generally invoiced weekly based on agreed rates per employee and actual hours worked, typically with payment terms of 30 days.
1 unchanged sentence
We report PEO revenues net of direct payroll costs because we are not the primary obligor for these payments to our clients’ employees.
−Removed: Direct payroll costs include salaries, wages, health insurance, and employee out-of-pocket expenses incurred incidental to employment.
+Added: Direct payroll costs include salaries and wages, client-provided health insurance, and employee out-of-pocket expenses incurred incidental to employment.
Cost of revenues
4 unchanged sentences
Benefit costs primarily comprise health insurance premiums paid to third-party carriers as part of our fully insured PEO benefits programs and underwriting and benefit consultant payroll.
−Removed: Workers' compensation costs consist primarily of premiums paid to third-party insurers, claims reserves, claims administration fees, legal fees, medical cost containment (“MCC”) expense, state administrative agency fees, third-party broker commissions, risk manager payroll, as well as costs associated with operating our two wholly owned insurance companies, AICE and Ecole.
+Added: Workers' compensation costs consist primarily of premiums paid to third-party insurers, claims reserves, third-party broker commissions, risk manager payroll, claims administration fees, legal fees, medical cost containment (“MCC”) expense, state administrative agency fees, as well as costs associated with operating our two wholly owned insurance companies, AICE and Ecole.
Cash and cash equivalents
3 unchanged sentences
The Company classifies investments as available-for-sale.
−Removed: The Company’s investments are reported at fair value with unrealized gains and losses, net of taxes, shown as a component of accumulated other comprehensive loss in stockholders' equity.
+Added: The Company’s investments are reported at fair value with unrealized gains and losses, net of taxes, shown as a component of accumulated other comprehensive income (loss) in stockholders' equity.
Investments are recorded as current on the consolidated balance sheets as the invested funds are available for current operations.
6 unchanged sentences
These investments are categorized as available-for-sale.
−Removed: They are reported at fair value with unrealized gains and losses, net of taxes, shown as a component of accumulated other comprehensive loss in stockholders’ equity.
+Added: They are reported at fair value with unrealized gains and losses, net of taxes, shown as a component of accumulated other comprehensive income (loss) in stockholders’ equity.
Restricted cash and investments are classified as current and noncurrent on the consolidated balance sheets based on the nature of the restriction.
3 unchanged sentences
Restricted cash and investments also includes investments held as part of the Company’s deferred compensation plan.
−Removed: These investments are classified as trading securities and are recorded at fair value with unrealized gains and losses reported as a component of income from operations.
+Added: These investments are classified as trading securities and are recorded at fair value with unrealized gains and losses reported as a component of income (loss) from operations.
Concentration of credit risk
5 unchanged sentences
The balance in trade accounts receivable is comprised primarily of unbilled receivables of $ 241.5 million and $ 218.8 million at December 31, 2025 and 2024, respectively.
−Removed: The remaining balance of $ 16.6 million and $ 14.4 million in trade accounts receivable at December 31, 2024 and 2023, respectively, is primarily related to outstanding billings to PEO and staffing clients, offset by an allowance for expected credits losses of $ 0.9 million at December 31, 2024 and 2023, respectively.
+Added: The remaining balance of $ 7.5 million and $ 16.6 million in trade accounts receivable at December 31, 2025 and 2024, respectively, is primarily related to outstanding billings to staffing and PEO clients, offset by an allowance for expected credits losses of $ 0.4 million and $ 0.9 million at December 31, 2025 and 2024, respectively.
Allowance for expected credit losses
−Removed: The Company had an allowance for expected credit losses of $ 0.9 million at December 31, 2024 and 2023.
+Added: The Company had an allowance for expected credit losses of $ 0.4 million and $ 0.9 million at December 31, 2025 and 2024, respectively.
We make estimates of the collectability of our accounts receivable for services provided to our customers based on future expected credit losses.
30 unchanged sentences
We capitalize software development costs incurred during the application development stage, which is the stage when preliminary project planning ends and software development begins.
−Removed: Capitalized costs generally include both internal and external costs associated with coding and testing.
+Added: Capitalized costs generally include both internal and external costs directly related to the development of the software.
Capitalized costs are amortized on a straight-line basis over the estimated useful life, commencing when the software is placed into service.
22 unchanged sentences
Our lease agreements generally do not contain material variable lease payments or restrictive covenants.
−Removed: Workers’ compensation claims liabilities
−Removed: Our workers’ compensation claims liabilities do not represent an exact calculation of liability but rather management’s best estimate of future obligation amounts under workers' compensation programs where the Company retains risk.
−Removed: These estimates utilize actuarial expertise and projection techniques, at a given reporting date, and are based on an evaluation of information provided by our third-party administrator for workers’ compensation claims, coupled with an actuarial estimate of future loss development with respect to reported claims and incurred but not reported claims (together, “IBNR”).
−Removed: Workers’ compensation claims liabilities include case reserve estimates for reported losses, plus additional amounts for estimated IBNR claims, MCC and legal costs, unallocated loss adjustment expenses and estimated future recoveries.
−Removed: The estimate of incurred costs expected to be paid within one year is included in current liabilities, while the estimate of incurred costs expected to be paid beyond one year is included in long-term liabilities on our consolidated balance sheets.
−Removed: These estimates are reviewed at least quarterly and adjustments to estimated liabilities are reflected in current operating results as they become known.
−Removed: The process of arriving at an estimate of unpaid claims and claims adjustment expense involves a high degree of judgment and is affected by both internal and external events, including changes in claims handling practices, changes in reserve estimation procedures, inflation, trends in the litigation and settlement of pending claims, and legislative changes.
−Removed: Our estimates are based on actuarial analysis and informed judgment, derived from individual experience and expertise applied to multiple sets of data and analyses.
+Added: Workers’ compensation costs
+Added: For all claims incurred under the Company’s self-insured workers’ compensation programs, we record an estimate for the total amount of workers’ compensation costs, which represents the amount necessary to pay claims and related expenses associated with workplace injuries that have occurred under the self-insured program.
+Added: In addition to our self-insured program, the Company provides workers' compensation coverage through a fully insured arrangement.
+Added: The Company's fully insured policies allow for return premiums if claims develop favorably, ranging from $ 20.0 million to $ 30.0 million depending on the policy period.
+Added: For the policy period beginning July 1, 2021, BBSI can incur additional premiums up to $ 7.5 million if claims develop adversely.
+Added: For all other policy years, no additional premiums can be charged based on claim performance.
+Added: Our estimate of the losses associated with workers’ compensation claims directly impacts our estimate of the return premiums we may realize or the additional premiums that we may incur.
+Added: When a claim involving a probable loss is reported, our independent third-party administrator for workers’ compensation claims (“TPA”) establishes a case reserve for the estimated amount of ultimate loss.
+Added: The estimate reflects a judgment based on established case reserving practices and the experience and knowledge of the TPA regarding the nature and expected amount of the claim, as well as the estimated expenses of settling the claim, including legal and other fees and expenses of claims administration.
+Added: adequacy of such case reserves depends in part on the professional judgment of the TPA to evaluate the economic consequences of each claim properly and comprehensively.
+Added: Our estimate of ultimate losses includes an additional component for potential future increases in the cost to finally resolve open injury claims and claims incurred in prior periods but not reported (together, "IBNR") based on actuarial estimates provided by the Company’s independent actuary.
+Added: IBNR does not apply to a specific claim but rather applies to the entire population of claims arising from a specific time period.
+Added: IBNR primarily covers costs relating to:
+Added: • Future claim payments in excess of case reserves on recorded open claims;
+Added: • Additional claim payments on closed claims;
+Added: • Claims that have occurred but have not yet been reported to us.
+Added: The process of estimating claims and claims adjustment expense involves a high degree of judgment and is affected by both internal and external events, including changes in claims handling practices, modifications in reserve estimation procedures, changes in individuals involved in the reserve estimation process, inflation, trends in the litigation and settlement of pending claims, and legislative changes.
+Added: Our estimates are based on actuarial analyses and informed judgment, derived from individual experience and expertise applied to multiple sets of data and analyses.
We consider significant facts and circumstances known both at the time that loss reserves are initially established and as new facts and circumstances become known.
−Removed: Due to the inherent uncertainty underlying loss reserve estimates, the expenses incurred through final resolution of our liability for our workers’ compensation claims will likely vary from the related loss reserves at the reporting date.
−Removed: Therefore, as specific claims are paid out in the future, actual paid losses may be materially different from our current loss reserves.
+Added: Due to the inherent uncertainty underlying loss estimates, the ultimate expense incurred will likely vary from the related loss estimate at the reporting date.
+Added: Therefore, as specific claims are paid out in the future, actual paid losses may be materially different from our current loss estimates.
A basic premise in most actuarial analyses is that historical data and past patterns demonstrated in the incurred and paid historical data form a reasonable basis upon which to project future outcomes, absent a material change.
−Removed: Significant structural changes to the available data can materially impact the reserve estimation process.
−Removed: To the extent a material change affecting the ultimate claim liability becomes known, such change is quantified to the extent possible through an analysis of internal Company data and, if available and when appropriate, external data.
−Removed: Nonetheless, actuaries exercise a considerable degree of judgment in the evaluation of these factors and the need for such actuarial judgment is more pronounced when faced with material uncertainties.
+Added: Significant structural changes to the available data can materially impact the estimation process.
+Added: To the extent a material change affecting the ultimate claim amount becomes known, such change is quantified to the extent possible through an analysis of internal company data and, if available and when appropriate, external data.
+Added: Actuaries exercise a considerable degree of judgment in the evaluation of these factors and the need for such actuarial judgment is more pronounced when faced with material uncertainties.
Customer deposits
−Removed: We require deposits from certain PEO customers to cover a portion of our accounts receivable due from such customers in the event of default of payment.
−Removed: Comprehensive income
−Removed: Comprehensive income includes all changes in equity during a period except those that resulted from investments by or distributions to the Company's stockholders.
−Removed: Other comprehensive income refers to revenues, expenses, gains and losses that under U.S.
−Removed: generally accepted accounting principles (“GAAP”) are included in comprehensive income, but excluded from net income as these amounts are recorded directly as an adjustment to stockholders' equity.
−Removed: Our other comprehensive income comprises unrealized holding gains and losses on our available-for-sale investments.
+Added: We require deposits from certain PEO and staffing customers to cover a portion of our accounts receivable due from such customers in the event of default of payment.
+Added: Comprehensive income (loss)
+Added: Comprehensive income (loss) includes all changes in equity during a period except those that resulted from transactions with the Company's stockholders.
+Added: Other comprehensive income (loss) comprises unrealized holding gains and losses on our available-for-sale investments, net of tax.
Statements of cash flows
Interest paid in 2025, 2024 and 2023 did not materially differ from interest expense.
−Removed: Income taxes paid by the Company totaled $ 14.9 mil lion, $ 22.2 million, and $ 21.0 million in 2024, 2023 and 2022, respectively.
+Added: Income taxes paid, net of income tax refunds received by the Company, totaled $ 15.4 million during 2025 , comprised of $ 12.5 million in federal tax and $ 2.9 million in state tax, of which $ 2.3 million was paid to California.
+Added: Income taxes paid net of income tax refunds received by the Company totaled $ 13.7 million during 2024 , comprised of $ 13.1 million in federal tax and $ 0.6 million in state tax.
+Added: No individual state made up more than 5 % of income taxes paid net of income tax refunds received by the Company during 2024 .
+Added: taxes paid net of income tax refunds received by the Company totaled $ 22.2 million in 2023 , comprised of $ 16.6 million in federal tax and $ 5.6 million in state tax, of which $ 4.0 million was paid to California.
Bank deposits and other cash equivalents that are restricted for use are classified as restricted cash.
17 unchanged sentences
Actual results may or may not differ from such estimates.
−Removed: Reclassifications
−Removed: To conform to the current period’s presentation, the prior period balance of accrued payroll, payroll taxes and related benefits on the consolidated balance sheets of $ 234.1 million was disaggregated into accrued payroll and related benefits of $ 160.9 million and payroll taxes payable of $ 73.2 million.
−Removed: In the consolidated statements of cash flows, the 2023 amount of net cash inflows from accrued payroll, payroll taxes and related benefits of $ 12.7 million was disaggregated into net cash inflows from accrued payroll and related benefits of $ 5.7 million and net cash inflows from payroll taxes payable of $ 7.0 million.
−Removed: For 2022, net cash inflows from accrued payroll, payroll taxes and related benefits of $ 24.9 million was disaggregated into net cash inflows from accrued payroll and related benefits of $ 12.2 million and net cash inflows from payroll taxes payable of $ 12.7 million.
−Removed: To conform to the current period’s presentation, safety incentives liability of $ 1.3 million was reclassified to other accrued liabilities in the prior period consolidated balance sheets, and net cash outflows from safety incentives liability of $ 0.8 million and $ 2.3 million were reclassified to other accrued liabilities in the prior period consolidated statements of cash flows for the years ended December 31, 2023 and 2022, respectively.
−Removed: All share and per share amounts presented herein have been retroactively adjusted to reflect the impact of the 2024 Stock Split.
−Removed: To conform to the current period’s presentation, additional paid-in-capital of approximately $ 0.2 million was reclassified to common stock in the prior period consolidated balance sheets and prior periods' consolidated statements of stockholders' equity.
Recent accounting pronouncements
The following Accounting Standards Updates (ASUs) have been recently issued by the Financial Accounting Standards Board (FASB).
−Removed: ASU 2023-07, Segment Reporting (Topic 280):
−Removed: Improvements to Reportable Segment Disclosures
−Removed: In November 2023, the FASB issued ASU 2023-07, which expands annual and interim reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses.
−Removed: ASU 2023-07 is effective for fiscal years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024.
−Removed: We have adopted this ASU on a retrospective basis for the annual reporting period of our fiscal year beginning January 1, 2024 with no material effects on the Company’s financial condition, results of operations, or cash flows.
ASU 2023-09, Income Taxes (Topic 740):
2 unchanged sentences
The ASU applies to all entities subject to income taxes.
−Removed: The new requirements will be effective for annual periods beginning after December 15, 2024.
−Removed: The guidance will be applied on a prospective basis with the option to apply the standard retrospectively.
−Removed: Early adoption is permitted.
−Removed: We plan to adopt this ASU for the annual reporting period of our fiscal year beginning January 1, 2025.
−Removed: We are evaluating the impact of applying this new accounting guidance to our income tax disclosures but do not expect the adoption of this ASU to have any material effects on the Company’s financial condition, results of operations, or cash flows.
+Added: The new requirements are effective for annual periods beginning after December 15, 2024.
+Added: We have adopted this ASU on a retrospective basis for the annual reporting period of our fiscal year beginning January 1, 2025, with no material effects on the Company’s financial condition, results of operations, or cash flows.
ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40):
4 unchanged sentences
The amendments in this ASU should be applied either (1) prospectively to financial statements issued for reporting periods after the effective date or (2) retrospectively to any or all prior periods presented in the financial statements.
−Removed: We are evaluating the impact of this new accounting standard but do not expect the adoption of this ASU to have any material effects on the Company’s financial condition, results of operations, or cash flows.
+Added: We are evaluating the impact of this new accounting standard on the Company's consolidated financial statements and related disclosures.
+Added: We do not expect that the adoption of this ASU will have a material effect on the Company’s financial condition, results of operations, or cash flows.
+Added: ASU 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40):
+Added: Targeted Improvements to the Accounting for Internal-Use Software
+Added: In September 2025, the FASB issued ASU 2025-06, which amends the capitalization criteria of software development costs.
+Added: The ASU eliminates the prior project-stage model and implements a probable-to-complete recognition threshold.
+Added: The amendments in this ASU are effective for annual reporting periods beginning after December 15, 2027 and interim reporting periods within those annual reporting periods.
+Added: Early adoption is permitted as of the beginning of an annual reporting period.
+Added: The amendments in this ASU should be applied using either a prospective transition approach, modified transition approach, or retrospective transition approach.
+Added: We are evaluating the impact of this new accounting standard on the Company's consolidated financial statements and related disclosures.
+Added: We do not expect that the adoption of this ASU will have a material effect on the Company’s financial condition, results of operations, or cash flows.
Note 2 - Fair Value Measurement
26 unchanged sentences
Corporate bonds
−Removed: government agency securities
Mortgage-backed securities
Asset-backed securities
−Removed: Emerging markets
+Added: government agency securities
Total current investments
14 unchanged sentences
Cash equivalents:
+Added: Money market funds
Corporate bonds
−Removed: agency securities
Mortgage-backed
Asset-backed securities
−Removed: Emerging markets
+Added: agency securities
Restricted cash and investments:
3 unchanged sentences
Asset-backed securities
+Added: Money market funds
Emerging markets
14 unchanged sentences
Corporate bonds
−Removed: government agency securities
Money market funds
+Added: government agency securities
Asset-backed securities
−Removed: Emerging markets
December 31, 2024
15 unchanged sentences
Corporate bonds
−Removed: government agency securities
Mortgage-backed securities
+Added: government agency securities
Asset-backed securities
4 unchanged sentences
government agency securities
−Removed: Asset-backed securities
Total restricted investments
−Removed: Total investments and restricted investments
+Added: Total investments and
+Added: restricted investments
December 31, 2024
5 unchanged sentences
Asset-backed securities
−Removed: Emerging Markets
Total investments
5 unchanged sentences
Total restricted investments
−Removed: Total investments and restricted investments
+Added: Total investments and
+Added: restricted investments
We have determined that the gross unrealized losses on our investments as of December 31, 2025 and 2024 were temporary in nature.
9 unchanged sentences
We recognized $ 4.6 million, $ 3.9 million, and $ 3.5 million in amortization of capitalized software development costs in 2025, 2024 and 2023, respectively.
−Removed: We capitalized $ 12.4 million, $ 6.0 million and $ 5.3 million of software development costs in 2024, 2023 and 2022 , respectively.
−Removed: Note 4 - Workers' Compensation Claims
+Added: We capitalize d $ 16.0 million, $ 12.4 million and $ 6.0 million of software development costs in 2025, 2024 and 2023 , respectively.
+Added: Note 4 - Workers' Compensation Claims Liabilities
The following table summarizes the aggregate workers' compensation reserve activity (in thousands):
17 unchanged sentences
Approximately 86 % of the Company’s workers’ compensation exposure is covered through the insured program.
−Removed: Effective July 1, 2021, the Company entered into a fully insured arrangement for its insured program, whereby third-party insurers assume substantially all risk of loss for claims incurred under the program.
−Removed: This fully insured arrangement has been extended annually and covers claims incurred between July 1, 2021 and June 30, 2025, with an option to renew through June 30, 2026.
−Removed: Each annual fully insured policy allows BBSI to participate in savings if claims develop favorably up to a maximum per policy year ranging from $ 20.5 million to $ 28.5 million, depending on the policy period.
−Removed: For only the policy period from July 1, 2021 to June 30 2022, BBSI can also incur additional premium up to $ 7.5 million if claims develop adversely.
−Removed: No additional premium can be charged based on claim performance for other policy years.
+Added: The Company maintains a fully insured arrangement for its insured program, whereby third-party insurers assume substantially all risk of loss for claims incurred under the program.
+Added: This fully insured arrangement covers claims incurred between July 1, 2021 and June 30, 2026.
+Added: The Company’s fully insured policies allow for return premiums if claims develop favorably, ranging from $ 20.0 million to $ 30.0 million, depending on the policy period.
+Added: For the policy period beginning July 1, 2021, BBSI can incur additional premiums up to $ 7.5 million if claims develop adversely.
+Added: For all other policy years, no additional premiums can be charged based on claim performance.
Premiums incurred but not paid are recorded as either current or long-term premium payable on the consolidated balance sheets based on the expected timing of the payments.
5 unchanged sentences
2021 - July 1 and after
−Removed: ( 1) The loss portfolio transfers excluded approximately 10 % of claims from 2018 and included an approximately offsetting amount of claims from 2019.
The Company is required to maintain minimum collateral levels for certain policies issued under the insured program, which is held in a trust account (the “trust account”).
−Removed: The balance in the trust account was $ 197.1 million and $ 210.9 million at December 31, 2024 and December 31, 2023, respectively.
+Added: The balance in the trust account was $ 175.3 million an d $ 197.1 million at December 31, 2025 and December 31, 2024, respectively.
The trust account balance is included as a component of the current and long-term restricted cash and investments in the Company’s consolidated balance sheets.
9 unchanged sentences
Claims liabilities
−Removed: The Company provided a total of $ 128.4 million and $ 167.8 million at December 31, 2024 and 2023 , respectively, as an estimated future liability for unsettled workers' compensation claims liabilities.
−Removed: Of this amount, $ 6.0 million on December 31, 2024 and 2023 , represent case reserves and IBNR in excess of the Company’s retention.
−Removed: The accrual for costs incurred in excess of retention is offset by a receivable from insurance carriers of $ 6.0 million at December 31, 2024 and 2023 , included in other assets in the consolidated balance sheets.
−Removed: Note 5 - Revolving Credit Facility and Long-Term Debt
+Added: The Company provided a total of $ 108.6 million and $ 128.4 million at December 31, 2025 and 2024 , respectively, as the estimated future liability for unsettled workers' compensation claims liabilities.
+Added: Of this amount, $ 9.7 million and $ 6.0 million at December 31, 2025 and 2024 respectively, represent case reserves and IBNR in excess of the Company’s retention.
+Added: The accrual for costs incurred in excess of retention is offset by a receivable from insurance carriers of $ 9.7 million and $ 6.0 million at December 31, 2025 and 2024 respectively, which is included in other assets in the consolidated balance sheets.
+Added: Note 5 - Revolving Credit Facility
The Company maintains an agreement (the “Agreement”) with Wells Fargo Bank, N.A.
4 unchanged sentences
The credit facility is collateralized by the Company’s accounts receivable and other rights to receive payment.
−Removed: The revolving credit facility will mature on July 1, 2026 , unless extended.
+Added: The revolving credit facility will mature on August 1, 2028 , unless extended.
The Agreement requires the satisfaction of certain financial covenants as follows:
10 unchanged sentences
We have a 401(k) Retirement Savings Plan for the benefit of our eligible employees.
−Removed: Employees covered under a PEO arrangement may participate in the plan at the sole discretion of the PEO client.
+Added: Employees covered under a PEO arrangement may participate in the plan at the discretion of the PEO client.
We make matching contributions to the 401(k) plan under a safe harbor provision.
The determination of any discretionary Company contributions to the plan is at the sole discretion of our Board of Directors.
−Removed: No discretionary Company contributions were made to the plan for the years ended December 31, 2024, 2023 and 2022 .
+Added: No discretionary Company contributions were made to the plan for the years ended December 31, 2025, 2024 or 2023.
We made matching contributions of $ 2.8 million , $ 2.6 million and $ 2.4 million in 2025, 2024 and 2023, respectively.
2 unchanged sentences
The current portion of the deferred compensation plan liability was $ 1.7 million and $ 1.5 million at December 31, 2025 and 2024, respectively, and is recorded in other accrued liabilities on the consolidated balance sheets.
−Removed: The fair value of the long-term asset portion o f this plan was $ 9.5 million and $ 7.9 million at D ecember 31, 2024 and 2023 , respectively, and is recorded in noncurrent restricted cash and investments on the consolidated balance sheets.
+Added: The fair value of the long-term asset portion of this plan was $ 11.9 million and $ 9.5 million at D ecember 31, 2025 and 2024, respectively, and is recorded in noncurrent restricted cash and investments on the consolidated balance sheets.
The fair value of the current asset portion of this plan was $ 1.7 million and $ 1.5 million at December 31, 2025 and 2024 , respectively, and is recorded in current restricted cash and investments on the consolidated balance sheets.
25 unchanged sentences
Total operating lease liabilities
−Removed: The Company has additional operating leases of $ 7.1 million that have not commenced as of December 31, 2024 , and as such, have not been recognized in the Company’s Consolidated Balance Sheets.
−Removed: These operating leases are expected to commence in 2025 with lease terms of 5 to 7 years.
+Added: The Company has no additional operating leases that have not commenced as of December 31, 2025 .
Note 8 - Income Taxes
1 unchanged sentence
Year Ended December 31,
+Added: Current provision for income taxes
Total current provision for income taxes
+Added: Deferred provision for income taxes
Total deferred provision for income taxes
+Added: Provision for income taxes
Total provision for income taxes
2 unchanged sentences
Deferred compensation
−Removed: Tax effect of unrealized losses, net
−Removed: Operating lease liability
Workers' compensation claims liabilities
+Added: Operating lease liability
+Added: Tax effect of unrealized losses, net
Equity based compensation
12 unchanged sentences
Statutory federal tax rate
−Removed: State taxes, net of federal benefit
−Removed: Nondeductible expenses and other, net
−Removed: Adjustment for final positions on filed returns
−Removed: Federal and state tax credits
+Added: State and local income taxes,
+Added: net of federal income tax effect (1)
+Added: Nontaxable or nondeductible items
+Added: Nondeductible Officers' Compensation (162(m))
+Added: Equity-based compensation windfall tax difference
+Added: Other nondeductible expenses (no item >5%)
+Added: Changes in unrecognized tax benefits
+Added: Changes in valuation allowances
Effective tax rate
+Added: (1) State taxes in California made up the majority (greater than 50 percent) of the tax effect in this category in all years reported.
+Added: On July 4, 2025, the One Big Beautiful Bill Act was signed into law, extending key provisions of the 2017 Tax Cuts and Jobs Act including, but not limited to, federal bonus depreciation and deductions for domestic research and development expenditures.
+Added: This new legislation does not have a material impact on the Company's results of operations.
Under ASC 740, “Income Taxes,” management evaluates the realizability of the deferred tax assets on a quarterly basis under a “more-likely-than-not” standard.
1 unchanged sentence
One component of this analysis is to determine whether the Company was in a cumulative loss position for the most recent 12 quarters.
−Removed: The Company was in a cumulative income position for the 12 quarters ended at both December 31, 2024 and December 31, 2023.
−Removed: The Company’s realization of a portion of net deferred tax assets is based in part on our estimates of the timing of reversals of certain temporary differences and on the generation of taxable income before such reversals.
+Added: The Company was in a cumulative income position for the 12 quarters ended December 31, 2025.
+Added: At December 31, 2025 and December 31, 2024, the Company had not recorded a valuation allowance against its deferred tax assets.
The Company is subject to income taxes in U.S.
1 unchanged sentence
The Internal Revenue Service (the "IRS") is examining the Company’s federal tax returns for the years ended December 31, 2017 through 2021 .
−Removed: BBSI received notices that the IRS intends to disallow certain wage-based tax credits claimed for the years 2017 through 2021 , which could result in estimated total additional taxes of $ 8.0 million and penalties of $ 1.9 million plus related interest.
+Added: BBSI received notices that the IRS intends to disallow certain wage-based tax credits claimed for the years 2017 through 2021 , which could result in estimated total additional taxes of $ 8.0 million and penalties and interest of $ 5.2 million.
The Company disagrees with the IRS determination to disallow certain wage-based credits taken by the Company and has filed U.S.
4 unchanged sentences
As of December 31, 2025, total gross unrecognized tax benefits, excluding interest and penalties, of $ 0.8 million would affect the Company's effective tax rate if recognized in future periods.
−Removed: The Company does not anticipate any material changes to the reserve in the next 12 months.
The Company had unrecognized tax benefit of $ 0.5 million and $ 0.8 million as of December 31, 2024 and December 31, 2023, respectively.
1 unchanged sentence
Depending on the percentage of this income as compared to total consolidated income, the Company's state effective tax rate could fluctuate from expectations.
−Removed: At December 31, 2024, the Company had no state operating loss carryforwards.
−Removed: At December 31, 2024 , the Company did no t have a federal general business tax credit carryforward or an alternative minimum tax credit carryforward.
+Added: At December 31, 2025, the Company had no state or federal operating loss carryforwards or tax credit carryforwards.
Note 9 - Stock Incentive Plans
The Company's 2020 Stock Incentive Plan (the "2020 Plan"), which provides for share-based awards to Company employees, non-employee directors and outside consultants or advisors, was approved by stockholders on May 27, 2020, and amended with stockholder approval on June 5, 2023, to increase the number of shares available for issuance under the 2020 Plan from 1,500,000 to 2,900,000 .
−Removed: On June 3, 2024, the Company's stockholders approved an amendment of the Company's Amended and Restated Charter to increase the number of authorized shares of Common Stock of the Company from 20,500,000 to 82,000,000 (the "Charter Amendment").
−Removed: The Company's Board of Directors proposed the Charter Amendment in part to permit a four -for-one split of the Company's common stock.
−Removed: As such, the number of shares available for issuance under the 2020 Plan increased from 725,000 to 2,900,000 .
The number of shares available for grants of awards at December 31, 2025 was 592,654 .
6 unchanged sentences
Outstanding at December 31, 2024
−Removed: Options granted at market price
Options exercised
7 unchanged sentences
Weighted average fair value per share
+Added: No stock options were granted during the years ended December 31, 2025 or 2023.
The weighted average fair value of stock options granted for the year ended December 31, 2024 was $ 12.16 .
There were no stock options granted with an exercise price below market price during 2024.
−Removed: No stock options were granted during 2023 or 2022.
The intrinsic value of stock options exercised for the years ended December 31, 2025, 2024 and 2023 was $ 4.0 million , $ 0.6 million, and $ 0.1 million, respectively.
−Removed: The fair value of stock options vested for the years ended December 31, 2024 and December 31, 2022 was $ 728,000 .
−Removed: No stock options vested during the years ended December 31, 2023.
+Added: The fair value of stock options vested for the years ended December 31, 2024 was $ 728,000 .
+Added: No stock options vested during the years ended December 31, 2025 or 2023.
As of December 31, 2025 , unrecognized compensation expense related to stock options was $ 0.5 million with a weighted average remaining amortization period of 1.9 years.
Restricted Stock Units
−Removed: Restricted stock units generally vest in four equal annual installments beginning one year following the date of grant, other than restricted stock units granted to nonemployee directors since 2019, which vest one year following the date of grant.
+Added: Restricted stock units generally vest in four equal annual installments beginning one year following the date of grant, other than restricted stock units granted to nonemployee directors, which vest one year following the date of grant.
The following table presents restricted stock unit activity:
13 unchanged sentences
Nonvested at December 31, 2025
−Removed: The total grant date fair value of PSUs vested during the years ended December 31, 2024, 2023 and 2022 was $ 1.7 million, $ 1.6 million, and $ 259,000 , respectively.
+Added: The total grant date fair value of PSUs vested during the years ended December 31, 2025, 2024 and 2023 was $ 1.8 million, $ 1.7 million, and $ 1.6 million, respectively.
Employee Stock Purchase Plan
5 unchanged sentences
The Company maintains a stock repurchase program approved by the Board of Directors, which authorizes the repurchase of shares from time to time in open market purchases.
−Removed: On July 31, 2023, the Board of Directors authorized the repurchase of up to $ 75.0 million of the Company’s common stock over a two-year period beginning July 31, 2023 .
−Removed: The new repurchase program replaces the program approved in February 2022 .
+Added: On August 4, 2025, the Board of Directors authorized the repurchase of up to $ 100.0 million of the Company’s common stock over a two-year period beginning August 4, 2025 .
+Added: The new repurchase program replaces the program approved in July 2023 .
The Company repurchased 1,035,638 , 848,958 and 1,500,456 shares at an aggregate purchase price of $ 42.0 million, $ 29.1 million and $ 34.2 million during 2025, 2024 and 2023, respectively.
−Removed: In addition, shares of restricted stock units withheld to satisfy tax-withholding obligations from the vesting of restricted stock units were 153,372 , 131,552 and 92,452 in 2024, 2023 and 2022 , respectively, which are not subject to the current repurchase program.
−Removed: Revolving Credit Facility and Long-Term Debt” for related restrictions on share repurchases.
+Added: In addition, shares of restricted stock units withheld to satisfy tax-withholding obligations from the vesting of restricted stock units were 144,463 , 153,372 and 131,552 in 2025, 2024 and 2023, respectively, which are not subject to the current repurchase pr ogram.
+Added: Revolving Credit Facility” for related restrictions on share repurchases.
Note 11 - Litigation
−Removed: On April 5, 2011, several individual plaintiffs filed a wage and hour class action in the California Superior Court, County of Fresno, naming as defendants their employer, a Merry Maids franchisee;
+Added: On April 5, 2011, several individual plaintiffs filed a wage and hour class action in the California Superior Court, County of Fresno, which was subsequently removed to the United States District Court for the Eastern District of California, naming as defendants their employer, a Merry Maids franchisee;
BBSI, which was providing PEO services to the franchisee;
1 unchanged sentence
Plaintiffs claimed, among other things, that BBSI and the franchisor were their joint employer with the franchisee and therefore jointly responsible for the alleged wage and hour violations.
−Removed: BBSI continues to maintain that it was not the plaintiff's joint employer.
−Removed: Notwithstanding, in January 2025, the plaintiffs and BBSI reached an agreement in principle to settle the matter, subject to the completion of definitive documentation and customary court approval.
−Removed: BBSI is subject to other legal proceedings and claims that arise in the ordinary course of our business.
+Added: BBSI's position is that it was not the plaintiffs' joint employer.
+Added: Notwithstanding, the plaintiffs and BBSI reached an agreement to settle the matter, which was filed with the trial court for court approval pursuant to the rules for class action settlements.
+Added: The settlement was granted final approval in October 2025 and in November 2025 BBSI satisfied all payment obligations under the settlement agreement.
+Added: As of December 31, 2025, no amount remains recorded in other accrued liabilities in the consolidated balance sheets related to this matter.
+Added: BBSI is subject to legal proceedings and claims that arise in the ordinary course of our business.
There are significant uncertainties surrounding litigation.
−Removed: For the matter discussed above, as well as other cases, management has recorded estimated liabilities totaling $ 1.7 million in other accrued liabilities in the consolidated balance sheets.
+Added: In consideration of these factors, management has recorded estimated liabilities totaling $ 0.5 million within other accrued liabilities in the consolidated balance sheets.
Note 12 - Subsequent Events
16 unchanged sentences
Control systems, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control systems' objectives are being met.
−Removed: Further, the design of any control systems must reflect the fact that there are resource constraints, and the benefits of all controls must be considered relative to their costs.
+Added: Further, the design of any control systems
+Added: must reflect the fact that there are resource constraints, and the benefits of all controls must be considered relative to their costs.
Due to the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected.
These inherent limitations include the realities that judgments in decision making can be faulty and that breakdowns can occur because of simple errors or mistakes.
−Removed: systems can also be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls.
+Added: Control systems can also be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls.
The design of any system of controls is based in part on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.
30 unchanged sentences
OT HER INFORMATION
+Added: Rule 10b5-1 Trading Arrangements
+Added: During the quarter ended December 31, 2025, the executive officers of the Company listed below adopted a “Rule 10b5-1 trading arrangement” (as defined in Item 408 of Regulation S-K adopted under the Exchange Act).
+Added: There were no “non-Rule 10b5-1 trading arrangements” (as defined in Item 408(c)) adopted , modified , or terminated by the Company’s directors and executive officers during the quarter ended December 31, 2025.
+Added: The Rule 10b5-1 trading arrangements listed below were adopted in accordance with the Company’s Insider Trading Policy.
+Added: Actual sale transactions made pursuant to the Rule 10b5-1 trading arrangements described below will be disclosed publicly in Section 16 filings with the SEC in accordance with applicable securities laws, rules, and regulations.
+Added: Number of Shares
+Added: That May Be Sold
+Added: Name and Title
+Added: Under the Plan
+Added: Plan Expiration Date
+Added: Gerald Blotz , Executive Vice President and Chief Operating Officer
+Added: December 15, 2025
+Added: Indeterminable (1)
+Added: July 10, 2026
+Added: James Potts , Executive Vice President and General Counsel
+Added: December 15, 2025
+Added: Indeterminable (2)
+Added: July 31, 2026
+Added: Blotz's Rule 10b5-1 Trading Plan (the "Blotz Plan") provides for the potential sale of up to (i) 18,257 shares of common stock beginning on July 3, 2026 upon the vesting of restricted stock units ("RSUs") that are expected to vest on July 1, 2026, and (ii) 14,354 shares of common stock beginning on March 16, 2026 from performance stock units ("PSUs") that vested on February 23, 2026.
+Added: Shares in the Blotz Plan underlying RSUs and PSUs may only be sold following satisfaction of the applicable time-based and performance-based vesting requirements.
+Added: Additionally, shares will only be sold provided that the market price of the Company’s common stock is higher than minimum threshold prices specified in the Blotz Plan.
+Added: Due to the minimum threshold prices, the time-based and performance-based vesting requirements, and the number of shares to be withheld to satisfy applicable tax obligations, the exact number of shares to be sold pursuant to the Blotz Plan is not yet determinable.
+Added: For purposes of this disclosure, we have included the maximum number of shares available to be sold without regard to vesting or withholding conditions.
+Added: The Blotz Plan is intended to satisfy the affirmative defense of Rule 10b5-1(c) under the Exchange Act.
+Added: Potts’s Rule 10b5-1 Trading Plan (the "Potts Plan") provides for the potential sale of up to (i) 11,508 shares of common stock beginning on July 3, 2026 upon the vesting of RSUs that are expected to vest on July 1, 2026, and (ii) 6,350 shares of common stock beginning on March 16, 2026 from PSUs that vested on February 23, 2026.
+Added: Shares in the Potts Plan underlying RSUs and PSUs may only be sold following satisfaction of the applicable time-based and performance-based vesting requirements.
+Added: Additionally, shares will only be sold provided that the market price of the Company’s common stock is higher than minimum threshold prices specified in the Potts Plan.
+Added: Due to the minimum threshold prices, the time-based and performance-based vesting requirements, and the number of shares to be withheld to satisfy applicable tax obligations, the exact number of shares to be sold pursuant to the Potts Plan is not yet determinable.
+Added: For purposes of this disclosure, we have included the maximum number of shares available to be sold without regard to vesting or withholding conditions.
+Added: The Potts Plan is intended to satisfy the affirmative defense of Rule 10b5-1(c) under the Exchange Act.
DIS CLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS
3 unchanged sentences
The Company believes that its insider trading policy and repurchase procedures are reasonably designed to promote compliance with insider trading laws, rules and regulations, and the Nasdaq Stock Market LLC listing standards applicable to the Company.
−Removed: A copy of the Company’s insider trading policy is filed as Exhibit 19.1 to this Form 10-K.
+Added: A copy of the Company’s insider trading policy was filed with our 2024 Annual Report on Form 10-K as Exhibit 19.1.
Additional information required by this item is incorporated by reference to the information set forth under the captions or subcaptions “Proposal 1:
−Removed: Election of Directors,” “Audit and Compliance Committee,” “Background and Experience of Executive Officers," “Code of Ethics,” and “Delinquent Section 16(a) Reports” in our definitive Proxy Statement to be filed with the Securities and Exchange Commission pursuant to Regulation 14A within 120 days after the end of the fiscal year covered by this report (the “Proxy Statement”).
+Added: Election of Directors,” “Audit and Compliance Committee,” “Background and Experience of Executive Officers," and “Code of Ethics” in our definitive Proxy Statement to be filed with the Securities and Exchange Commission pursuant to Regulation 14A within 120 days after the end of the fiscal year covered by this report (the “Proxy Statement”).
EXE CUTIVE COMPENSATION
25 unchanged sentences
Third Amended and Restated Credit Agreement between the Registrant and Wells Fargo Bank, National Association (“Wells Fargo”), dated as of March 1, 2022.
−Removed: First Amendment, effective as of June 12, 2023, to Third Amended and Restated Credit Agreement
−Removed: between the Registrant and Wells Fargo
−Removed: Bank, National Association.
+Added: Second Amendment, effective as of August 1, 2025, to Third Amended and Restated Credit Agreement between the Registrant and Wells Fargo Bank, National Association.
Amended and Restated Security Agreement:
1 unchanged sentence
Amended and Restated Standby Letter of Credit Agreement dated as of June 20, 2018, between the Registrant and Wells Fargo .
−Removed: Fifth Amended and Restated Revolving Line of Credit Note effective June 12, 2023 of the Registrant.
+Added: Sixth Amended and Restated Revolving Line of Credit Note effective August 1, 2025 of the Registrant.
Description of the Registrant's Capital Stock.
2015 Stock Incentive Plan of the Registrant (the "2015 Plan").
−Removed: 2015 Stock Incentive Plan of the Registrant (the "2015 Plan").
Amended and Restated 2020 Stock Incentive Plan of the Registrant (the "2020 Plan").
Form of Performance Share Award Agreement under the 2020 Plan.
−Removed: Nonqualified Stock Option Award Agreement between the Registrant and Thomas J.
−Removed: Carley dated July 1, 2016.
Form of Employee Nonqualified Stock Option Award Agreement for grants to Gerald R.
1 unchanged sentence
Kramer effective March 28, 2018, under the 2015 Plan.
−Removed: Form of Incentive Stock Option Award Agreement relating to February 2, 2015, grants under the 2009 Plan .
−Removed: Form of Restricted Stock Units Award Agreement for Executive Officers for awards granted beginning in 2018 under the 2015 Plan .
Form of Restricted Stock Units Award Agreement for Executive Officers under the 2020 Plan .
51 unchanged sentences
/s/ Joseph S.
−Removed: Vice Chairman of the Board and Director
+Added: Chairman of the Board and Director
/s/ Thomas B.
/s/ Anthony Meeker
−Removed: Chairman of the Board and Director
Anthony Meeker
3 unchanged sentences
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.