10-K

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-K

x Annual Report Under Section 13 or 15(d) of the Securities Exchange Act of 1934

For the fiscal year ended September 30, 2012

o Transition Report Under Section 13 or 15(d) of the Securities Exchange Act of 1934

Commission File Number 1-05707

GENERAL EMPLOYMENT ENTERPRISES, INC

(Exact name of registrant as specified in its charter)

Illinois	36-6097429
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification Number)

One Tower Lane, Suite 2200, Oakbrook Terrace, IL	60181
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (630) 954-0400

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Name of each exchange on which registered
Common Stock, no par value	NYSE MKT

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Yes     o             No       x

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.

Yes     o             No       x

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes     o             No      x

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes    x          No      o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to the Form 10-K.  o

Indicate by checkmark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company.  See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act (check one):

Large accelerated filer	o	Accelerated filer	o
Non-accelerated filer	o	Smaller reporting company	x

Indicate by checkmark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes     o             No       x

The aggregate market value of shares of common stock held by non-affiliates of the registrant on March 31, 2012 was 3,306,305 x 0.57 = $1,884,594.

The number of shares outstanding of the registrant’s common stock as of March 28, 2013 was 21,699,675.

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TABLE OF CONTENTS

		Page
PART I
Item 1.	Business.	1
Item 1A.	Risk Factors.	4
Item 1B.	Unresolved Staff Comments.	9
Item 2.	Properties.	9
Item 3.	Legal Proceedings.	10
Item 4.	Mine Safety Disclosures	10
PART II
Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.	10
Item 6.	Selected Financial Data.	11
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations.	11
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	19
Item 8.	Financial Statements and Supplementary Data.	20
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.	41
Item 9A.	Controls and Procedures	41
Item 9B.	Other Information.	42
PART III
Item 10.	Directors, Executive Officers and Corporate Governance.	43
Item 11.	Executive Compensation.	48
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.	55
Item 13.	Certain Relationships and Related Transactions, and Director Independence.	56
Item 14.	Principal Accountant Fees and Services.	57
PART IV
Item 15.	Exhibits and Financial Statement Schedules.	59
	Signatures	63

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PART I

Forward Looking Statement

This Annual Report on Form 10-K includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The Company has based these forward-looking statements on the Company’s current expectations and projections about future events. These forward-looking statements are subject to known and unknown risks, uncertainties and assumptions about us and the Company’s subsidiaries that may cause the Company’s actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “could,” “would,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “continue” or the negative of such terms or other similar expressions. Factors that might cause or contribute to such a material difference include, but are not limited to, those discussed elsewhere in this Annual Report, including the section entitled “Risks Factors” and the risks discussed in the Company’s other Securities and Exchange Commission filings. The following discussion should be read in conjunction with the Company’s audited Financial Statements and related Notes thereto included elsewhere in this report.

Item 1. Business.

General

General Employment Enterprises, Inc. (the “Company”, “us”, “our” or “we”) was incorporated in the State of Illinois in 1962 and is the successor to employment offices doing business since 1893.  In 1987 the Company established Triad Personnel Services, Inc., a wholly-owned subsidiary, incorporated in the State of Illinois.  In June 2010, the Company purchased certain assets of On-Site Services, a temporary staffing agricultural business.  In December 2010, the Company purchased certain assets of DMCC Staffing, LLC (“DMCC”) and RFFG of Cleveland, LLC (“RFFG of Cleveland”) an industrial staffing business located in the state of Ohio.  In August 2011, the Company purchased certain assets of Ashley Ellis, LLC (“Ashley Ellis”), a professional staffing and placement business. The principal executive office of the Company is located at One Tower Lane, Suite 2200, Oakbrook Terrace, Illinois.

Changes in Control of the Company

On January 3, 2012, each of Trinity HR Services, LLC, a Delaware limited  liability company (“Trinity Services”), Trinity HR, LLC, a Kentucky limited liability company (“Trinity HR”), Brandon Simmons, Jeff Moody and J. Sherman Henderson III (collectively, the “Trinity Group”) filed Schedule 13Ds (the “Schedule 13D Filings”) with the Securities and Exchange Commission disclosing that each of Messrs. Simmons, Moody and Henderson, as co-managers of Trinity Services and Trinity HR, may be deemed to beneficially own, in the aggregate, 12,825,281 shares of the Company’s common stock, no par value (the “Common Stock”), or approximately 59.1% of the issued and outstanding Common Stock based on the number of shares outstanding as of September 30, 2011, reported by the Company in its Annual Report on Form 10-K for the period ended September 30, 2011, filed on December 29, 2011, constituting a change of control for the Company.

According to the Schedule 13D Filings, Gregory L. Skaggs, the sole member of PSQ, LLC, a Kentucky limited liability company (“PSQ”), which owned 9,325,281 shares of Common Stock, or approximately 43% of the issued and outstanding Common Stock (the “PSQ Shares”), had sold his entire membership interest in PSQ to Trinity Services, effective as of December 12, 2011, which Trinity Services distributed to itself on December 13, 2011.  The PSQ Shares were purchased by Trinity Services for $500,000, payable in monthly installments through seller financing from Mr. Skaggs and approximately $45,000 of short term borrowings from Derby Capital, LLC, an affiliate of Messrs. Henderson and Moody.  Trinity Services pledged the PSQ Shares to Mr. Skaggs as collateral for payment of the balance of the purchase price.

The Schedule 13D Filings also disclosed that Trinity HR had acquired 3,500,000 shares of Common Stock (the “RFFG Shares” and, together with the PSQ Shares, the “Shares”) or approximately 16.1% of the issued and outstanding Common Stock, from RFFG, LLC (“RFFG”), a wholly owned subsidiary of Trinity HR, on December 21, 2011 as a distribution from RFFG.  Trinity HR acquired RFFG from WTS Acquisition LLC on September 8, 2011.  RFFG previously obtained beneficial ownership of the RFFG Shares in early September 2011 as a prospective purchase price payment from the Company to RFFG in connection with the sale by RFFG to the Company of a portion of its business on December 30, 2010.

On August 28, 2012, Brandon Simmons filed an Amendment No. 1 to Schedule 13D (the “Trinity 13D Filing”) with the SEC disclosing that on August 21, 2012, (i) Trinity Services sold 9,325,281 shares (the “Services Shares”) of Common Stock to LEED HR (owned and controlled by Michael Schroering our Chairman of the Board and Chief Executive Officer) and (ii) Trinity HR sold 2,974,719 shares (the “HR Shares” and, together with the Services Shares, the “Transferred Shares”) of Common Stock to LEED (collectively, the “Trinity Transfer”).  As a result of the Trinity Transfer, LEED acquired an aggregate of 12,300,000 shares of Common Stock, or approximately 57% of the issued and outstanding Common Stock based on the number of shares outstanding as of August 13, 2012, reported by the Company in its Quarterly Report on Form 10-Q for the period ended June 30, 2012, filed on August 14, 2012, constituting a change of control for the Company.

According to the Trinity 13D Filing and the exhibits attached thereto, the Services Shares were purchased by LEED for a purchase price of $2,274,000, payable as follows: (i) $37,900 in cash at closing, (ii) $721,000 within 45 days thereof, and (iii) the balance by delivery of a promissory note.  As additional consideration, LEED also agreed to promptly pay Trinity Services, 40% of any proceeds in excess of $4,662,641 received by LEED from (x) the sale of the first 2,974,719 Transferred Shares either sold by LEED or subject to a “Deemed Sale” (defined as shares deemed to be sold if, after the third anniversary date from August 21, 2012, the market price of the Transferred Shares exceeds $0.50, subject to certain exclusions), and (y) all dividends or distributions made by the Company.  Under the promissory note, LEED is required to pay to Trinity Services, $1,515,100 plus interest accrued at an annual rate of one percent (1%), not later than January 21, 2014.  LEED is also required to pay Trinity Services under the promissory note, one-half (1/2) of the net proceeds of any sales of the Transferred Shares yielding aggregate proceeds to LEED in excess of $250,000 in any twelve-month period.

According to the Trinity 13D Filing and the exhibits attached thereto, the HR Shares were purchased by LEED for a purchase price of $726,000, payable as follows: (i) $12,100 in cash at closing, (ii) $229,000 within 45 days thereof, and (iii) the balance by delivery of a promissory note.  As additional consideration, LEED also agreed to promptly pay Trinity HR, 40% of any proceeds in excess of $1,487,359.50 received by LEED from (x) the sale of the first 2,974,719 Transferred Shares either sold by LEED or subject to a Deemed Sale (as defined above), and (y) all dividends or distributions made by the Company.  Under the promissory note, LEED is required to pay to Trinity HR, $484,900 plus interest accrued at an annual rate of one percent (1%), not later than January 21, 2014.  LEED is also required to pay Trinity HR under the promissory note, one-half (1/2) of the net proceeds of any sales of the Transferred Shares yielding aggregate proceeds to LEED in excess of $250,000 in any twelve-month period.

On August 24, 2012, the Company was informed of the transfer of 3,357,410 shares of Common Stock, constituting approximately 15.5% of the issued and outstanding Common Stock, from Big Red Investment Partnership, Ltd. to LEED, pursuant to a privately negotiated transaction (the “Big Red Transfer”).  As a result of the Trinity Transfer and the Big Red Transfer, LEED may be deemed to beneficially own 15,657,410 shares of Common Stock, constituting approximately 74% of the issued and outstanding Common Stock.  LEED is controlled by our current Chief Executive officer and Chairman of the Board, Michael Schroering.

Services Provided

The Company provides the following distinctive services: (a) professional placement services specializing in the placement of information technology, engineering, and accounting professionals for direct hire and contract staffing, (b) temporary staffing services in the agricultural industry and (c) temporary staffing services in light industrial staffing.

The Company’s placement services include placing candidates into regular, full-time jobs with client-employers. The Company’s contract services include professional employees and light industrial employees on temporary assignments, under contracts with client companies. Professional and light industrial contract workers are employees of the Company, typically working at the client location and at the direction of client personnel for periods of one week to one year.  The Company’s light industrial staffing provides services to clients through five offices in Ohio and one office in Pennsylvania.  The Company’s temporary staffing in the agricultural industry provides agricultural workers for farms and groves primarily located in Florida.  Most of the workers migrate from location to location because the work is seasonal depending on the type of crop.

2

In conjunction with the purchase of the assets of DMCC and RFFG of Cleveland in fiscal 2011, the Company entered into a management service agreement (the “Management Agreement”) with RFFG to operate its day to day business, but due to an unresolved issue with the Ohio Bureau of Workers Compensation, the former owners of RFFG ceased operations as of July 15, 2011.  As a result the consolidated statements of operations reflect a loss on impairment of intangible assets of $1,126,000, offset by income of $1,276,000 from the reduction of an associated earn-out liability.   We do not provide management services to any other company and management does not currently intend to provide management services to any other company in the foreseeable future.

The percentage of revenues derived from each of the Company’s distinctive services is as follows:

	Year Ended September 30
	2012			2011
Agricultural contract services		15	%		34	%
Industrial contract services		54	%		33	%
Professional contract services		17	%		19	%
Direct hire placement services		14	%		12	%
Management services		-	%		2	%

Marketing

The Company markets its services using the trade names General Employment Enterprises, Omni One, Business Management Personnel, Ashley Ellis, Triad Personnel Services, Triad Staffing, Generation Technologies, BMCH, BMCHPA and On-Site Services. As of September 30, 2012, it operated twenty two branch offices located in downtown or suburban areas of major U.S. cities in eleven states. The offices were located in Arizona, California (4), Florida (2), Georgia, Illinois (2), Indiana, Massachusetts, North Carolina, Ohio (7), Pennsylvania and Texas.

The Company markets its staffing services to prospective clients primarily through telephone marketing by its recruiting and sales consultants, and through mailing of employment bulletins, which list candidates available for placement and contract employees available for assignment.  The Company’s agricultural staffing services are marketed directly through contact and relationships built and maintained by the division’s general manager.

There was no customer that represented more than 10% of the Company’s consolidated revenue in fiscal 2012; however the Company did have two large customers that represented approximately 17.4% and 11.5% of the Company’s consolidated revenue for fiscal 2011.

Competition

The staffing industry is highly competitive. There are relatively few barriers to entry by firms offering placement services, while significant amounts of working capital typically are required for firms offering contract services. The Company’s competitors include a large number of sole-proprietorship operations, as well as regional and national organizations. Many of them are large corporations with substantially greater resources than the Company.

The Company’s professional and industrial staffing services compete by providing highly qualified candidates who are well matched for the position, by responding quickly to client requests, and by establishing offices in convenient locations. As part of its service, the Company provides professional reference checking, scrutiny of candidates’ work experience and optional background checks. In general, pricing is considered to be secondary to quality of service as a competitive factor. During slow hiring periods, however, competition can put pressure on the Company’s pricing.

3

The agricultural staffing service is considered a niche business that requires a high capital reserve to cover the weekly payroll.  There are few businesses in this market and the Company does not anticipate a significant change in the pricing for the next year.

Recruiting

The success of the Company’s services is highly dependent on its ability to obtain qualified candidates. Prospective employment candidates are generally recruited through telephone contact by the Company’s employment consultants or through postings on the Internet. For Internet postings, the Company maintains its own web page at www.generalemployment.com and uses other Internet job posting bulletin board services. The Company maintains database records of applicants’ skills to assist in matching them with job openings and contract assignments. The Company generally screens and interviews all applicants who are presented to its clients.  The Company’s agricultural service employees are generally seasonal migrant workers, who are typically recurring workers or are directly recruited by the customers.

Employees

As of September 30, 2012, the Company had approximately 140 regular employees and the number of contract service employees varied week to week from a minimum of 200 to a maximum of 4,000.

Available Information

We file annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, proxy and information statements and amendments to reports filed or furnished pursuant to Sections 139a), 14 and 15(d) if the Securities and Exchange Act of 1934, as amended.  The public may obtain these filings at the Securities and Exchange Commission (SEC)’s Public Reference Room at 100 F Street, NE, Washington DC 20549 or by calling the SEC at 1-800-SEC-0330.  The SEC also maintains a web site at http//www.sec.gov that contains reports, proxy and information statements and other information regarding the General Employment Enterprise’s and other companies that file material with the SEC electronically.   Copies of the Company’s reports can be obtained, free of charge, electronically through our internet website, http//www.generalemployment.com.

Item 1A. Risk Factors.

WE HAVE EXPERIENCED LOSSES FROM OPERATIONS AND MAY NOT BE PROFITABLE IN THE FUTURE

The Company experienced significant losses for the year ended September 30, 2012. There can be no assurance that the Company will not incur losses in the future. The Company’s operating expenses have increased as the business has grown and can be expected to increase significantly because of expansion efforts. There is no assurance that the Company will be able to generate sufficient revenue to meet its operating expenditures or continue to operate profitably.

RECENT GLOBAL TRENDS IN THE FINANCIAL MARKETS COULD ADVERSELY AFFECT OUR BUSINESS, LIQUIDITY AND FINANCIAL RESULTS

Recent global economic conditions, including disruption of financial markets, could adversely affect our business and results of operations, primarily through limiting our access to credit, our ability to refinance debt and disrupting our customers’ businesses, which are heavily dependent on retail and e-commerce transactions. Although we currently believe that we will be able to obtain the necessary financing in the future, there is no assurance that these institutions will be able to loan us the necessary capital, which could have a material adverse impact on our business. In addition, continuation or worsening of general market conditions in the United States economy important to our businesses may adversely affect our customers’ level of spending, ability to obtain financing for purchases and ability to make timely payments to us for our services, which could require us to increase our allowance for doubtful accounts, negatively impact our days sales outstanding and adversely affect our results of operations.

4

WE DEPEND ON ATTRACTING, INTEGRATING, MANAGING, AND RETAINING QUALIFIED PERSONNEL.

Our success depends upon our ability to attract, integrate, manage and retain personnel who possess the skills and experience necessary to fulfill our clients’ needs. Our ability to hire and retain qualified personnel could be impaired by any diminution of our reputation, decrease in compensation levels relative to our competitors or modifications to our total compensation philosophy or competitor hiring programs. If we cannot attract, hire and retain qualified personnel, our business, financial condition and results of operations may suffer. Our future success also depends upon our ability to manage the performance of our personnel. Failure to successfully manage the performance of our personnel could affect our profitability by causing operating inefficiencies that could increase operating expenses and reduce operating income.

OUR CHIEF EXECUTIVE OFFICER AND CHAIRMAN OF THE BOARD, TOGETHER WITH HIS AFFILIATES, CONTROL A MAJORITY OF THE COMBINED VOTING POWER OF OUR COMMON STOCK, WHICH MAY GIVE RISE TO CONFLICTS OF INTERESTS

Michael Schroering, our Chief Executive Officer and Chairman of the Board, together with his affiliates control approximately 74% of the Company’s voting shares outstanding. As a result, Mr. Schroering and his affiliates are able to control all matters requiring the Company’s stockholders’ approval, including the election of directors and approval of significant corporate transactions. This concentration of ownership may delay, prevent or deter a change in control, and could deprive the Company’s stockholders of an opportunity to receive a premium for their common stock as part of a sale of the Company or its assets.  The interests of Mr. Schroering and his affiliates may not always coincide with your interests or the interests of other stockholders, and they may act in a manner that advances their best interests and not necessarily those of other stockholders.

In addition, there have been two civil actions brought against Mr. Schroering and certain of his affiliates questioning the validity of the two transactions that have resulted in Mr. Schroering’s ownership of approximately 74% of the Company, including a lawsuit in which the Company has been named.  In the event Mr. Schroering is deemed to not have properly acquired these shares, it is unclear whether Mr. Schroering will remain our Chief Executive Officer and Chairman of the Board and/or who will control the Company thereafter.

WE MAY NOT BE ABLE TO COMPETE EFFECTIVELY

Competition in the market for placement and staffing services is intense. The Company faces competition from many larger, more established companies. In addition, other companies could seek to introduce competing services and increased competition could result in a decrease in the price charged by the Company’s competitors for their services or reduce demand for the Company’s products and services, which would have a material adverse effect on the Company’s business, operating results and financial condition.  There can be no assurance that the Company will be able to compete successfully with its existing or potential competitors, which may have substantially greater financial, technical, and marketing resources, longer operating histories, greater name recognition or more established relationships in the industry than the Company. If any of these competitors provides competitive services to the marketplace in the future, the Company cannot be sure that it will have the resources or expertise to compete successfully.

CHANGES IN GOVERNMENT REGULATION COULD LIMIT OUR GROWTH OR RESULT IN ADDITIONAL COSTS OF DOING BUSINESS

We are subject to the same federal, state and local laws as other companies conducting placement and staffing services, which is extensive.  The adoption or modification of laws related to the placement and staffing industry, such as the Healthcare for America Plan, could harm our business, operating results and financial condition by increasing our costs and administrative burdens.

5

INTERRUPTION OF THE COMPANY’S BUSINESS COULD RESULT FROM INCREASED SECURITY MEASURES IN RESPONSE TO TERRORISM

The continued threat of terrorism within the United States and the ongoing military action and heightened security measures in response to such threat has and may cause significant disruption to commerce. The U.S. economy in general is being adversely affected by terrorist activities and potential activities. Any economic downturn could adversely impact the Company’s results of operations, impair the Company’s ability to raise capital or otherwise adversely affect the Company’s ability to grow the business. It is impossible to predict how this may affect the Company’s business or the economy in the U.S. and in the world. In the event of further threats or acts of terrorism, the Company’s business and operations may be severely and adversely affected or destroyed.

SUBSTANTIAL ALTERATION OF THE COMPANY’S CURRENT BUSINESS AND REVENUE MODEL COULD HURT SHORT-TERM RESULTS

The Company’s present business and revenue model represents the current view of the optimal business and revenue structure, which is to derive revenues and achieve profitability in the shortest period. There can be no assurance that current models will not be altered significantly or replaced with an alternative model that is driven by motivations other than near-term revenues and/or profitability (for example, building market share before the Company’s competitors). Any such alteration or replacement of the business and revenue model may ultimately result in the deferring of certain revenues in favor of potentially establishing larger market share. The Company cannot assure that any adjustment or change in the business and revenue model will prove to be successful.

THE REQUIREMENTS OF BEING A PUBLIC COMPANY MAY STRAIN OUR RESOURCES AND DISTRACT MANAGEMENT.

As a public company, we are subject to the reporting requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”).  These requirements are extensive.  The Exchange Act requires that we file annual, quarterly and current reports with respect to our business and financial condition.  The Sarbanes-Oxley Act requires that we maintain effective disclosure controls and procedures and internal controls over financial reporting.

We may incur significant costs associated with our public company reporting requirements and costs associated with applicable corporate governance requirements.  We expect all of these applicable rules and regulations to significantly increase our legal and financial compliance costs and to make some activities more time consuming and costly.  This may divert management’s attention from other business concerns, which could have a material adverse effect on our business, financial condition and results of operations.  We also expect that these applicable rules and regulations may make it more difficult and more expensive for us to obtain director and officer liability insurance and we may be required to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage.  As a result, it may be more difficult for us to attract and retain qualified individuals to serve on our board of directors or as executive officers.  We are currently evaluating and monitoring developments with respect to these rules, and we cannot predict or estimate the amount of additional costs we may incur or the timing of such costs.

FAILURE TO ACHIEVE AND MAINTAIN EFFECTIVE INTERNAL CONTROLS IN ACCORDANCE WITH SECTION 404 OF THE SARBANES-OXLEY ACT OF 2002 COULD HAVE A MATERIAL ADVERSE EFFECT ON OUR BUSINESS AND OPERATING RESULTS. IN ADDITION, CURRENT AND POTENTIAL STOCKHOLDERS COULD LOSE CONFIDENCE IN OUR FINANCIAL REPORTING, WHICH COULD HAVE A MATERIAL ADVERSE EFFECT ON OUR STOCK PRICE.

Effective internal controls are necessary for us to provide reliable financial reports and effectively prevent fraud. If we cannot provide reliable financial reports or prevent fraud, our operating results could be harmed. We are required to document and test our internal control procedures in order to satisfy the requirements of Section 404 of the Sarbanes-Oxley Act, which requires annual management assessments of the effectiveness of our internal controls over financial reporting. During the course of our testing, we may identify deficiencies which we may not be able to remediate in time for compliance with the requirements of Section 404. In addition, if we fail to maintain the adequacy of our internal controls, as such standards are modified, supplemented or amended from time to time; we may not be able to ensure that we can conclude on an ongoing basis that we have effective internal controls over financial reporting in accordance with Section 404 of the Sarbanes-Oxley Act. Failure to achieve and maintain an effective internal control environment could also cause investors to lose confidence in our reported financial information, which could have a material adverse effect on our stock price.

6

We cannot provide assurance as to the result of these efforts. We cannot be certain that any measures we take will ensure that we implement and maintain adequate internal controls in the future. Any failure to implement required new or improved controls, or difficulties encountered in their implementation, could harm our operating results or cause us to fail to meet our reporting obligations

WE HAVE EXPERIENCED A SIGNIFICANT CHANGE IN THE COMPOSITION OF OUR BOARD OF DIRECTORS (THE “BOARD”) AND SENIOR MANAGEMENT, INCLUDING THE DEPARTURE OF OUR FORMER CHIEF EXECUTIVE OFFICER, CHIEF FINANCIAL OFFICER, AND PRESIDENT. FAILURE OF ANY NEW MANAGEMENT AND BOARD MEMBERS TO INTEGRATE THEMSELVES INTO, AND EFFECTIVELY MANAGE, OUR BUSINESS, INCLUDING ANY NEW STRATEGIES THEY MAY ADOPT, COULD RESULT IN MATERIAL HARM TO THE COMPANY.

On February 22, 2013, Jarett A. Misch, our former Chief Financial Officer and Treasurer resigned from all positions with the Company.  To assist the Company in completion of the fiscal 2012 audit, the Company engaged Andrew J. Norstrud, a Consultant with Norco Accounting & Consulting, who subsequently became our Chief Financial Officer effective March 28, 2013.  On January 31, 2013, Herbert F. Imhoff Jr., our former President and a director, retired from all positions with the Company.  On December 26, 2012, Salvatore J. Zizza, our former Chief Executive Officer and Chairman of the Board, retired from all positions with the Company, and Mr. Schroering was appointed by the Board as Chief Executive Officer and Chairman of the Board.  On October 2, 2012, Edward O. Hunters was appointed to the Board to fill the vacancy created by the resignation of Charles W.B. Wardell III on September 4, 2012.

The failure of our Directors or any new members of management to perform effectively or the loss of any of the Directors or former or current members of management could have a significant negative impact on our business, financial condition and results of operations. In addition, our Board and management may institute strategies that differ from those we are applying currently. If any new strategies are adopted, it may take management a significant amount of time to fully implement such new strategies. If any new strategies are unsuccessful or if we are unable to execute them successfully, there could be a significant negative impact on our business, financial condition, and results of operations.

WE HAVE NOT REGISTERED WITH THE SEC OR LISTED WITH THE NYSE MKT, THE SHARES UNDERLYING OPTIONS ISSUED UNDER OUR 2011 INCENTIVE PLAN.

We have issued options to purchase 1.5 million shares of our common stock under the Company's 2011 Incentive Plan, all of which are fully vested and exercisable.  We have not yet filed a registration statement on Form S-8, registering the shares underlying such options, nor have we listed such shares with the NYSE MKT.  If we do not register these shares, the Company may be subject to civil or other penalties (including sanctions) by regulatory authorities and/or stockholders for certain violations of federal or state securities laws.  We may also be subject to the suspension of trading in, or removal from listing from, the NYSE MKT for failure to comply with our NYSE MKT listing agreement.

WE ARE NOT CURRENTLY IN COMPLIANCE WITH THE NYSE MKT LLC’S REPORTING REQUIREMENTS AND FAILURE TO REGAIN AND MAINTAIN COMPLIANCE WITH THIS STANDARD COULD RESULT IN DELISTING AND ADVERSELY AFFECT THE MARKET PRICE AND LIQUIDITY OF OUR COMMON STOCK AND OUR ABILITY TO RAISE ADDITIONAL CAPITAL.

Our common stock is currently listed on the NYSE MKT LLC (“NYSE MKT”). Companies trading on the NYSE MKT, such as us, must be reporting issuers under Section 12 of the Exchange Act and must be current in their reports filed under Section 13 of the Exchange Act. If we fail to remain current on our reporting requirements, we could be removed from the NYSE MKT.

7

On January 17, 2013 and February 21, 2013, the Company received notices from the NYSE MKT staff indicating that the Company is below certain of the NYSE MKT’s continued listing standards due to its delinquency in filing its Annual Report on Form 10-K for the fiscal year ended September 30, 2012 and the delinquency in filing its Quarterly Report on Form 10-Q for the quarter ended December 31, 2012, as set forth in sections 134 and 1101 of the NYSE MKT Company Guide. The Company was afforded the opportunity to submit a plan of compliance to the NYSE MKT and on January 31, 2013 presented its plan for both reports to the NYSE MKT.  On March 5, 2013, the NYSE MKT notified the Company that it accepted the Company’s plan of compliance and granted the Company an extension until April 17, 2013 to regain compliance with the continued listing standards.  The Company will be subject to periodic review by the NYSE MKT staff during the extension period.  Failure to make progress consistent with the plan or to regain compliance with the continued listing standards by the end of the extension period could result in the Company being delisted from the NYSE MKT LLC. If we are delisted and cannot obtain listing on another major market or exchange, our stock’s liquidity would suffer, and we would likely experience reduced investor interest. Such factors may result in a decrease in our stock’s trading price. Delisting may also restrict us from issuing additional securities or securing financing.

VOLATILITY OF THE MARKET PRICE OF THE COMPANY’S STOCK IS LIKELY TO OCCUR DUE TO THE LOW TRADING VOLUME OF OUR STOCK

The market price of the Company’s common stock may be volatile, which could cause the value of your investment to decline. Any of the following factors could affect the market price of our common stock:

· Changes in earnings estimates and outlook by financial analysts;

· Our failure to meet investors’ performance expectations;

· General market and economic conditions;

· Our small trading volume.

ACCORDING TO THE SEC, THE MARKET FOR PENNY STOCKS HAS SUFFERED FROM PATTERNS OF FRAUD AND ABUSE

Such patterns include:

· Control of the market for the security by one or a few broker–dealers that are often related to the promoter or issuer;

· Manipulation of prices through prearranged matching of purchases and sales and false and misleading press releases;

· “Boiler room” practices involving high-pressure sales tactics and unrealistic price projections by inexperienced sales persons;

· Excessive and undisclosed bid–ask differentials and markups by selling broker–dealers; and

· The wholesale dumping of the same securities by promoters and broker–dealers after prices have been manipulated to a desired level, along with the inevitable collapse of those prices with consequent investor losses.

In addition, many of the risks described elsewhere in this “Risk Factors” section could adversely affect the Company’s stock price. The stock markets have experienced price and volume volatility that have affected many companies’ stock prices. Stock prices for many companies have experienced wide fluctuations that have often been unrelated to the operating performance of those companies. These types of fluctuations may affect the market price of our common stock.

APPLICABILITY OF LOW PRICED STOCK RISK DISCLOSURE REQUIREMENTS COULD DISCOURAGE BROKERS FROM MAKING A MARKET IN OUR STOCK

The Company’s common stock may be considered a low priced security under rules promulgated under the Exchange Act. Under these rules, broker-dealers participating in transactions in low priced securities must first deliver a risk disclosure document which describes that risks associated with such stock, the broker-dealer’s duties, the customer’s rights and remedies, and certain market and other information, and make a suitability determination approving the customer for low priced stock transactions based on the customer’s financial situation, investment experience and objectives. Broker-dealers must also disclose these restrictions in writing and provide monthly account statements to the customer, and obtain specific written consent of the customer. With these restrictions, the likely effect of designation as a low price stock would be to decrease the willingness of broker-dealers to make a market for the stock, to decrease the liquidity of the stock and to increase the transaction costs of sales and purchase of such stocks compared to other securities.

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NO DIVIDENDS ANTICIPATED

The Company intends to retain all future earnings for use in the development of the Company’s business and does not anticipate paying any cash dividends on the Common Stock in the near future.

WE MAY NOT BE ABLE TO OBTAIN THE NECESSARY ADDITIONAL FINANCING TO ACHIEVE OUR STRATEGIC GOALS

There is no guarantee that we will be able to obtain financing required to continue to expand our business or that our present funding sources will continue to extend terms under which we can operate efficiently.  If we are unable to secure financing under favorable terms, we may be materially adversely affected.  On January 14, 2013, the Company and Wells Fargo Bank, National Association entered into a Fifth Amendment (the “Fifth Amendment”) to its Account Purchase Agreement dated as of December 14, 2010 (the “AR Credit Facility”).  The Fifth Amendment extended the term of the AR Credit Facility to December 14, 2013.  Notwithstanding the foregoing extension, Wells Fargo may issue a written notice to the Company shortening the term of the of the AR Credit Facility  to a date 60 days following such notice in the event that (i) the Company is not dismissed without prejudice from a recently brought lawsuit entitled Derby Capital LLC and Derby Capital JOB LLC, as plaintiffs, vs. Trinity HR Services, LLC, et al., as defendants, a lawsuit seeking to establish relative ownership among stockholders which the Company believes it should not be a party to, (ii) the Company fails to furnish Wells Fargo its audited financial statements for its fiscal year ended September 30, 2012 by March 15, 2013 or if the results in such audited financial statements are not satisfactory to Wells Fargo in its sole discretion,  (iii) background checks of newly appointed officers of the Company are unsatisfactory to Wells Fargo in its sole discretion, or (iv) significant changes have occurred to the composition of the Company’s Board of Directors as determined by Wells Fargo in its sole discretion.  In March of 2013 the Company and Wells Fargo entered into a Sixth Amendment that extended the required delivery date on certain documents, such as the audited financial statements, until April 30, 2013.

Our continued viability depends on our ability to raise capital.  Changes in economic, regulatory or competitive conditions may lead to cost increases.  Management may also determine that it is in our best interest to expand more rapidly than currently intended, to expand marketing activities, to develop new or enhance existing services or products, to respond to competitive pressures or to acquire complementary services, businesses or technologies. In any such case or other change of circumstance, additional financing will be necessary. If any additional financing is required, there can be no assurances that we will be able to obtain such additional financing on terms acceptable to us and at times required by us, if at all. In such event, we may be required to materially alter our business plan or curtail all or a part of our expansion plans.

WE MAY NOT BE ABLE TO MANAGE EXPECTED GROWTH AND INTERNAL EXPANSION

We have not yet undergone the significant managerial and internal expansion that we expect will occur, and our inability to manage growth could hurt our results of operations. Expansion of our operations will be required to address anticipated growth of our customer base and market opportunities. Expansion will place a significant strain on our management, operational and financial resources. Currently, we have a limited number of employees. We will need to improve existing procedures and controls as well as implement new transaction processing, operational and financial systems, procedures and controls to expand, train and manage our employee base. Our failure to manage growth effectively could have a damaging effect on our business, results of operations and financial condition.

Item 1B. Unresolved Staff Comments.

None.

Item 2. Properties.

The Company’s policy is to lease commercial office space for all of its offices.  The Company’s headquarters are located in a modern 31-story building near Chicago, Illinois. The Company leases 8,200 square feet of space at that location under a lease that will expire in 2015.

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The Company’s staffing offices are located in downtown and suburban business centers in eleven states.  The states that we have locations in are; Arizona, California, Florida, Georgia, Illinois, North Carolina, Indiana, Ohio, Texas, Massachusetts and Pennsylvania. Established offices are operated from leased space ranging from 800 to 2,000 square feet, generally for initial lease periods of one to five years, with cancellation clauses after certain periods of occupancy in some cases.  Management believes that existing facilities are adequate for the Company’s current needs and that its leasing strategies provide the Company with sufficient flexibility to open or close offices to accommodate business needs.

Item 3. Legal Proceedings.

In March 2012, the Company became aware of a lien on the business by the Ohio Bureau of Workers Compensation for $229,000, which has been fully accrued for.  The Company believes this claim represents unpaid workers compensation premium for a period prior to the acquisition of certain assets of RFFG of Cleveland in November 2010.  The Company is currently defending its position in this matter.

As of March 28, 2013, there were no other material legal proceedings pending against the Company.

Item 4. Mine Safety Disclosures

None.

PART II

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

Market Information

The Company’s common stock is listed on the NYSE MKT and is traded under the symbol “JOB.”  The following table sets forth the quarterly high and low sales prices per share of the Company’s common stock on the consolidated market for each quarter within the last two fiscal years.

	Fourth Quarter		Third Quarter		Second Quarter		First Quarter
Fiscal 2012:
High	$	.33	$	.53	$	.69	$	.65
Low		.18		.22		.41		.25
Fiscal 2011:
High	$	.33	$	.53	$	.69	$	.65
Low		.18		.22		.41		.25

Holders of Record

There were approximately 600 holders of record of the Company’s common stock on March 28, 2013.

Dividends

No dividends were declared or paid during the years ended September 30, 2011 and September 30, 2012. We do not anticipate paying any cash dividends for the foreseeable future.

Stock Repurchases by Issuer

During the two years ended September 30, 2012 and 2011, no equity securities of the Company were repurchased by the Company.

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Securities Authorized for Issuance under Equity Compensation Plans

As of September 30, 2012, there were stock options outstanding under the Company’s 1995 Stock Option Plan, Second Amended and Restated 1997 Stock Option Plan, 1999 Stock Option Plan and the 2011 Company Incentive Plan.  All four plans were approved by the shareholders.  The 1995 Stock Option Plan and the 1999 Stock Option Plan have expired, and no further options may be granted under those plans.  During fiscal 2009, the Second Amended and Restated 1997 Stock Option Plan was approved by the Board and shareholders to make an additional 592,000 options available for granting and as of September 30, 2012 there were 700,840 shares available for issuance under such plan.  As of September 30, 2012 there were 500,000 shares available for issuance under the 2011 Company Incentive Plan.  The plans granted specified numbers of options to non-employee directors, and they authorized the Compensation Committee of the Board of Directors to grant either incentive or non-statutory stock options to employees.  Vesting periods are established by the Compensation Committee at the time of grant.

Equity Compensation Plan Information

(number of shares in thousands)

Plan category	Number of securities to be issued upon exercise of outstanding options, warrants and rights		Weighted-average exercise price of outstanding options, warrants and rights		Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in first column)
Equity compensation plans approved by security holders		1,747	$	0.38		1,201
Equity compensation plans not approved by security holders		—		—		—
Total		1,747	$	0.38		1,201

Item 6. Selected Financial Data.

Not Applicable.

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

You should read the following discussion in conjunction with our consolidated financial statements and related notes included elsewhere in this report.

Overview

The Company provides staffing services through a network of branch offices located in major metropolitan areas throughout the United States.  The Company’s professional staffing services provide information technology, engineering and accounting professionals to clients on either a regular placement basis or a temporary contract basis.  The Company’s agricultural staffing services provide agricultural workers for farms and groves.  The Company’s industrial staffing business provides weekly temporary staffing for light industrial clients in Ohio and Pennsylvania.  

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The Company’s professional staffing services business is highly dependent on national employment trends in general and on the demand for professional staff in particular.  As an indicator of employment conditions, the national unemployment rate was 7.8% in September 2012 and 9.1% in September 2011.  In the past 12 months the unemployment rate has slowly decreased by approximately 1%; overall the trend has been flat over the past several years.

Results of Operations

Net Revenues

Consolidated net revenues are comprised of the following:

	Year Ended September 30
(In Thousands)	2012		2011
Agricultural contract services	$	7,852	$	12,412
Industrial contract services		28,206		12,349
Professional contract services		9,132		7,160
Direct hire placement services		7,215		4,430
Management services		-		838
Consolidated net revenues	$	52,405	$	37,189

Consolidated net revenues for the year ended September 30, 2012 increased by approximately 41% to approximately $52 million compared with the prior year of approximately $37 million.  The increase in revenue was due to a significant increase in revenue from contract services and direct placement, which was partially offset by the loss of a major customer in the Agriculture division and the termination of the management services agreement.    Contract service revenues, including On-Site Services, Inc., RFFG of Cleveland, LLC, DMCC, LLC and Ashley Ellis, LLC increased by approximately 42%, and direct hire placement service revenues increased by approximately 63%.

Cost of Contract Services

Consolidated cost of contract services are comprised of the following:

	Year Ended September 30
(In Thousands)	2012		2011
Agricultural contract services	$	7,506	$	11,835
Industrial contract services		23,368		10,551
Professional contract services		7,362		5,019
Consolidated cost of contract services	$	38,236	$	27,405

Cost of contract services for the year ended September 30, 2012 increased by approximately 40% to approximately $38 million compared with the prior year of approximately $27 million.  Cost of contract services, as a percentage of contract revenue, for the year ended September 30, 2012 decreased approximately 1%.  The overall increase in cost of contract services was directly related to the increase in revenue.  The decrease of approximately 1% of cost of  contract services as a percentage of contract services revenue was related to the decrease in the agricultural business.

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Selling, General and Administrative Expenses

Selling, general and administrative expenses include the following categories:

· Compensation in the operating divisions, which includes commissions earned by the Company’s employment consultants and branch managers on permanent and temporary placements.  It also includes salaries, wages, unrecovered advances against commissions, payroll taxes and employee benefits associated with the management and operation of the Company’s staffing offices.

· Administrative compensation, which includes salaries, wages, payroll taxes and employee benefits associated with general management and the operation of the finance, legal, human resources and information technology functions.

· Occupancy costs, which includes office rent, depreciation and amortization, and other office operating expenses.

· Recruitment advertising, which includes the cost of identifying job applicants.

· Other selling, general and administrative expenses, which includes travel, bad debt expense, fees for outside professional services and other corporate-level expenses such as business insurance and taxes.

The Company’s largest selling, general and administrative expense is for compensation in the operating divisions.  Most of the Company’s employment consultants are paid on a commission basis and receive advances against future commissions. When commissions are earned, prior advances are applied against them and the consultant is paid the net amount.  At that time, the Company recognizes the full amount as commission expense, and advance expense is reduced by the amount recovered.  Thus, the Company’s advance expense represents the net amount of advances paid, less amounts applied against commissions.

Selling, general and administrative expenses for the year ended September 30, 2012 increased by approximately $6 million to approximately $15 million as compared to the prior year of approximately $9 million.  The increase in selling, general and administrative expense was primarily related to the increase business; however there were also significant increases in stock compensation expense, bad debt expense, certain compensation expense related to the change of control, impairment of long-term assets and some general onetime expenses.    Selling, general and administrative expenses are not expected to continue to grow at a higher pace than revenue as the Company is able to eliminate many of the onetime expenses incurred in fiscal 2012 and the Company is able to capitalize on the consolidation of the acquisitions.

For the year ended September 30, 2012 there was a decrease in the amortization of intangible assets of approximately $143,000, which was primarily due to the impairment of long term intangible assets and a reduction of earn-out liabilities in the prior year.

Due to an unresolved issue with the Ohio Bureau of Workers Compensation, the former owners of RFFG have ceased operations as of July 15, 2011 and as a result the Management Agreement was effectively terminated and no future cash flows from this agreement are expected.  As a result, the Company recorded a loss on impairment of intangible assets of $1,126,000 and a reduction in the associated earn-out liability of $1,276,000, in 2011.

During the year ended September 30, 2012, the Company wrote off the intangible assets and goodwill of approximately $274,000 related to the Agricultural division due to the loss of a large customer in 2012.

Taxes

There were no credits for income taxes as a result of the pretax losses incurred during the periods because there was not sufficient assurance that future tax benefits would be realized.

Liquidity and Capital Resources

As of September 30, 2012, the Company had cash and cash equivalents of $364,000, which was an increase of approximately $50,000 from approximately $314,000 at September 30, 2011.  Net working capital at September 30, 2012 was approximately $530,000, which was a decrease of approximately $457,000 from September 30, 2011.  The Company’s current ratio was approximately 1.1 a decrease of approximately 0.1 from the prior year.  Shareholders’ equity as of September 30, 2012 was approximately $4,105,000 which represented approximately 37% of total assets.

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During the year ended September 30, 2012, net cash provided by operating activities was approximately $95,000.  The net loss for the year ended September 30, 2012 was approximately $1,011,000, adjusting the net loss for depreciation and amortization, stock compensation expense, impairment of goodwill and other non-cash charges; there was approximately $231,000 provided by operations.  Considering the changes in current assets and current liabilities, in addition to the significant increase in provision for doubtful accounts of $491,000 there was a net decrease of approximately $136,000, resulting in the positive cash flow from operations.

The Company used $511,000 in investing activities during fiscal 2012.  As part of the Ashley Ellis acquisition, and the Company used $200,000 in investing activities.  In addition, the Company used cash to acquire equipment in the amount of approximately $261,000.

The Company provided $466,000 of net cash from financing activities in 2012 by the increase in short term debt of approximately $466,000.

During the year ended September 30, 2011, net cash used by operating activities was $2,290,000.  The net income for the year ended September 30, 2012, adjusted for depreciation and amortization and other non-cash charges, was $929,000, while the large increase in accounts receivables and accrued compensation caused the working capital items to decrease by $3,219,000.  Overall, the increase in cash used in operations during fiscal 2011 is due to the significant increase in accounts receivables generated by the acquisitions of On-Site Services, Inc., RFFG of Cleveland, LLC, DMCC, LLC and Ashley Ellis, LLC.

The Company used $284,000 in investing activities during fiscal 2011.  As part of the Ashley Ellis, LLC acquisition, the Company used $200,000 in investing activities.  The Company provided $1,943,000 of net cash from financing activities in 2011 by the increase in short term debt and the exercising of stock options.

On August 31, 2011, the Company entered into an asset purchase agreement with Ashley Ellis LLC, an Illinois limited liability company (“Ashley Ellis”), and Brad A. Imhoff, for the purchase of certain assets of Ashley Ellis, including customer lists, comprising Ashley Ellis’ services business.  Ashley Ellis’ services business was operated from offices in Illinois, Texas and Georgia and provided services related to the recruitment and placement of technical personnel.  The asset purchase agreement was deemed effective on September 1, 2011.  Brad A. Imhoff is the brother of Herbert F. Imhoff, Jr., a former director of the Company and our former President.  Mr. Imhoff, Jr. resigned from all positions of the Company effective January 31, 2013.  The assets purchased from Ashley Ellis constitute a business and as such, the acquisition of these assets was accounted for as a business combination. The assets purchased related to the Ashley Ellis, LLC acquisition was not considered a significant acquisition.  The results of operations of Ashley Ellis, LLC are included in the Company’s statement of operations from the effective date of the acquisition, September 1, 2011.

As consideration for the assets, the Company paid Ashley Ellis $200,000 on the date of closing and agreed to pay Ashley Ellis an additional $200,000 within six months of closing.  The Company also issued to Ashley Ellis 1,250,000 shares of the Company’s common stock

In December 2010, the Company purchased certain assets of RFFG of Cleveland, LLC (“RFFG of Cleveland”) and DMCC Staffing, LLC (“DMCC”) and entered into a management agreement with RFFG, LLC (the previous parent company of RFFG of Cleveland and DMCC Staffing, LLC) to provide services to RFFG to operate its day-to-day business, including services related to accounting, sales, finance, workers compensation, benefits, physical locations, IT, and employees.  Thomas J. Bean, a 10% shareholder of the Company at the time (prior to consideration of common shares issued in this transaction), was the manager of RFFG. The assets purchased related to RFFG of Cleveland and DMCC Staffing constitute businesses and as such the acquisition of these assets will be accounted for as a business combination.

14

In consideration of the services provided under the management agreement, RFFG was to pay the Company approximately 6% of its gross revenues.  Gross revenues of RFFG were expected to approximate $18,000,000 on an annual basis, resulting in an expected management fee of approximately $1,000,000 per year.  The Company added employees to provide the services required under the management agreement.  In consideration for the assets acquired and the rights under the management agreement, the Company paid $2,400,000 through the issuance of its common stock.  In addition, the purchase agreement requires the Company to make additional payments of up to a total of $2,400,000 over the next four years if certain performance targets are achieved.  Under the terms of the purchase agreement, the maximum amount payable under the earn-out agreement for fiscal 2011 is $450,000.  The Management Agreement was terminated when RFFG’s operations were closed and as of September 30, 2012, there are no services being provided.  In addition, since the Company was providing certain management services, RFFG and the transactions between the RFFG and the Company were considered to be related party in nature because Thomas Bean, a manager, was a 10% owner of the Company at the time. The Company is currently in discussions with RFFG to amend the original purchase agreement as it relates to the earn-out since the value of the management agreement was of significant value with respect to the original purchase.  The Company has made payment of approximately $50,000 related to the earn-out liability and has a current liability of approximately $182,000, net of applicable off-sets at September 30, 2012.  At September 30, 2012 there is approximately $834,000 accrued for earn-out payments related to the original purchase agreement.

All of the Company’s office facilities are leased.  As of September 30, 2012, future minimum lease payments under non-cancelable lease commitments having initial terms in excess of one year, including closed offices, totaled approximately $2,200,000.

In connection with the completion of the sale of shares of common stock to PSQ in fiscal 2009, Herbert F. Imhoff, Jr., the Company’s then Chairman and Chief Executive Officer retired from those positions and his employment agreement with the Company was replaced by a new consulting agreement.  Under the consulting agreement, the Company became obligated to pay an annual consulting fee of $180,000 over a five-year period and to issue 500,000 shares of common stock to Mr. Imhoff, Jr. for no additional consideration, and the Company recorded a liability for the net present value of the future fee payments in the amount of $790,000.  As of September 30, 2012, $280,000 remains payable under this agreement and is included in accrued compensation and long-term obligations on the Company’s balance sheet.  On January 31, 2013, Mr. Imhoff Jr. retired from all positions with the Company, however he will continue to receive his monthly payments related to the accrued compensation of $280,000.

In December 2010, the Company terminated its agreement with Crestmark Bank and entered into a two-year, $3,000,000 account purchase agreement (“AR Credit Facility”) with Wells Fargo Bank N.A. (“Wells Fargo”).  The AR Credit Facility has been subsequently amended and  provides for borrowings on a revolving basis of up to 85% of the Company’s eligible accounts receivable less than 90 days old and bears interest at a rate equal to the three month LIBOR (minimum of .5%) plus 5.25% for a total interest rate of 5.75%.  Upon the terms and subject to the conditions in the agreement, Wells Fargo may determine which receivables are eligible receivables, may determine the amount it will advance on any such receivables, and may require the Company to repay advances made on receivables and thereby repay amounts outstanding under the AR Credit Facility.  Wells Fargo also has the right to require the Company to repurchase receivables that remain outstanding 90 days past their invoice date.  The Company continues to be responsible for the servicing and administration of the receivables purchased.  The Company will carry the receivables and any outstanding borrowings on its consolidated balance sheet.  The outstanding borrowings at September 30, 2012 are $2,404,000 and the remaining borrowing availability is $596,000.

On January 14, 2013, the Company and Wells Fargo Bank, National Association entered into a Fifth Amendment (the “Fifth Amendment”) to its AR Credit Facility.  The Fifth Amendment extended the term of the AR Credit Facility to December 14, 2013.  Notwithstanding the foregoing extension, Wells Fargo may issue a written notice to the Company shortening the term of the of the AR Credit Facility to a date 60 days following such notice in the event that (i) the Company is not dismissed without prejudice from a recently brought lawsuit entitled Derby Capital LLC and Derby Capital JOB LLC, as plaintiffs, vs. Trinity HR Services, LLC, et al., as defendants, a lawsuit seeking to establish relative ownership among stockholders which the Company believes it should not be a party to, (ii) the Company fails to furnish Wells Fargo its audited financial statements for its fiscal year ended September 30, 2012 by March 15, 2013 or if the results in such audited financial statements are not satisfactory to Wells Fargo in its sole discretion,  (iii) background checks of newly appointed officers of the Company are unsatisfactory to Wells Fargo in its sole discretion, or (iv) significant changes have occurred to the composition of the Company’s Board of Directors as determined by Wells Fargo in its sole discretion.  In March 2013, the Company and Wells Fargo entered into a Sixth Amendment that extended the required delivery date on certain of the foregoing requirements, such as the audited financial statements, until April 30, 2013.  To date, the Company has not received notice from Wells Fargo of any intent to shorten the term of the AR Credit Facility.

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The AR Credit Facility with Wells Fargo Bank includes certain covenants which require compliance until termination of the agreement.  As of September 30, 2012, the Company was in compliance with all such covenants.  

The Company believes that the borrowing availability under the AR Credit Facility will be adequate to fund the increase in working capital needs resulting from the acquisitions of On-Site, RFFG of Cleveland, DMCC Staffing, and Ashley Ellis.  In recent years, the Company has incurred significant losses and negative cash flows from operations.  Management has implemented a strategy which included cost reduction efforts as well as identifying strategic acquisitions, financed primarily through the issuance of common stock, to improve the overall profitability and cash flows of the Company.  In addition, as discussed above, the Company entered into an AR Credit Facility with Wells Fargo to provide working capital financing.

As of September 30, 2012, there were approximately $8,900,000 of losses available to reduce federal taxable income in future years through 2030, and there were approximately $7,525,000 of losses available to reduce state taxable income in future years, expiring from 2012 through 2031.  Due to the sale of shares of common stock to PSQ during fiscal 2009 and the change in ownership of PSQ in November 2010, the Company will be limited by Section 382 of the Internal Revenue Code as to the amount of net operating losses that may be used in future years.  The Company is currently evaluating the effects of any such limitation. Future realization of the tax benefits of net operating loss carryforwards ultimately depends on the existence of sufficient taxable income within the carryforward period.  Based on the weight of available evidence, the Company determined that it is more likely than not that all of the deferred tax assets will not be realized.  Accordingly, the Company maintained a full valuation allowance as of September 30, 2012.

Due to the sale of shares of common stock to LEED HR during fiscal 2012 and the resulting change in control, the Company will be limited by Section 382 of the Internal Revenue Code as to the amount of net operating losses that may be used in future years.

Management believes with current cash flow from operations and the availability under the AR Credit Facility, the Company will have sufficient cash for the next 12 months.

Off-Balance Sheet Arrangements

As of September 30, 2012 and 2011, and during the two years then ended, there were no transactions, agreements or other contractual arrangements to which an unconsolidated entity was a party, under which the Company (a) had any direct or contingent obligation under a guarantee contract, derivative instrument or variable interest in the unconsolidated entity, or (b) had a retained or contingent interest in assets transferred to the unconsolidated entity.

Critical Accounting Policies

The consolidated financial statements are prepared in conformity with accounting principles generally accepted in the United States of America and the rules of the United States Securities and Exchange Commission.

Management makes estimates and assumptions that can affect the amounts of assets and liabilities reported as of the date of the financial statements, as well as the amounts of reported revenues and expenses during the periods presented.  Those estimates and assumptions typically involve expectations about events to occur subsequent to the balance sheet date, and it is possible that actual results could ultimately differ from the estimates.  If differences were to occur in a subsequent period, the Company would recognize those differences when they became known.  Significant matters requiring the use of estimates and assumptions include deferred income tax valuation allowances, accounts receivable allowances, accounting for acquisitions, and evaluation of impairment of long-lived assets.  Management believes that its estimates and assumptions are reasonable, based on information that is available at the time they are made.

The following accounting policies are considered by management to be “critical” because of the judgments and uncertainties involved, and because different amounts would be reported under different conditions or using different assumptions.

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Income Taxes

We record a provision for income taxes for the anticipated tax consequences of the reported results of operations using the asset and liability method. Under this method, we recognize deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the financial reporting and tax basis of assets and liabilities, as well as for operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using the tax rates that are expected to apply to taxable income for the years in which those tax assets and liabilities are expected to be realized or settled. We record a valuation allowance to reduce our deferred tax assets to the net amount that we believe is more likely than not to be realized.

We recognize tax benefits from uncertain tax positions only if we believe that it is more likely than not that the tax position will be sustained on examination by the taxing authorities based on the technical merits of the position. Although we believe that we have adequately reserved for our uncertain tax positions, we can provide no assurance that the final tax outcome of these matters will not be materially different. We make adjustments to these reserves when facts and circumstances change, such as the closing of a tax audit or the refinement of an estimate. To the extent that the final tax outcome of these matters is different than the amounts recorded, such differences will affect the provision for income taxes in the period in which such determination is made and could have a material impact on our financial condition and operating results. The provision for income taxes includes the effects of any accruals that we believe are appropriate, as well as the related net interest and penalties.

Accounts Receivable

The Company extends credit to its various customers based on evaluation of the customer’s financial condition and ability to pay the Company in accordance with the payment terms. An allowance for placement falloffs is recorded, as a reduction of revenues, for estimated losses due to applicants not remaining employed for the Company’s guarantee period.  An allowance for doubtful accounts is recorded, as a charge to bad debt expense, where collection is considered to be doubtful due to credit issues.  These allowances together reflect management’s estimate of the potential losses inherent in the accounts receivable balances, based on historical loss statistics and known factors impacting its customers.  The nature of the contract service business, where companies are dependent on employees for the production cycle allows for a small accounts receivable allowance.  Based on management’s review of accounts receivable, an allowance for doubtful accounts of approximately $259,000 and $137,000 is considered necessary as of September 30, 2012 and September 30, 2011, respectively.  The Company charges uncollectible accounts against the allowance once the invoices are deemed unlikely to be collectible.  The Company does not accrue interest on past due receivables.

Goodwill

Goodwill represents the excess of cost over the fair value of the net assets acquired in the June 1, 2010 acquisition of On-Site Services, Inc., the November 1, 2010 purchase of DMCC Staffing, LLC and RFFG of Cleveland, LLC and Ashley Ellis, LLC on September 1, 2011.  The Company early adopted, the option to first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If the entity determines that this threshold is not met, then performing the two-step impairment test is unnecessary.  An impairment loss would be recognized to the extent the carrying value of goodwill exceeds its implied fair value.

Fair Value Measurement

The Company follows the provisions of the accounting standard which defines fair value, establishes a framework for measuring fair value and enhances fair value measurement disclosure. Under these provisions, fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (i.e., the “exit price”) in an orderly transaction between market participants at the measurement date.

The standard establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use on unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The hierarchy is described below:

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Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs.

Level 2: Observable prices that are based on inputs not quoted on active markets, but corroborated by market data.

Level 3: Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs.

Intangible Assets

Customer lists and non-compete agreements were recorded at their estimated fair value and are amortized over their estimated useful lives ranging from two to five years using accelerated and straight-line methods, respectively.

Impairment of Long-lived Assets

The Company records impairment on long-lived assets (including amortizable intangible assets) used in operations, other than goodwill, when events or circumstances indicate that the asset might be impaired and the estimated undiscounted cash flows to be generated by those assets over their remaining lives are less than the carrying amount of those items.  The net carrying value of assets not recoverable is reduced to fair value, which is typically calculated using the discounted cash flow method.

Segment Data

The Company has three operating business segments a) Contract staffing services, b) Direct hire placement services and c) Management services.  These operating segments were determined based primarily on how the chief operating decision maker views and evaluates our operations. Operating results are regularly reviewed by the chief operating decision maker to make decisions about resources to be allocated to the segment and to assess its performance. Other factors, including type of business, type of employee, length of employment, revenue recognition are considered in determining these operating segments.  Management services are no longer in operations during the year ended September 30, 2012.

Revenue Recognition

Placement service revenues are recognized when applicants accept offers of employment, less a provision for estimated losses due to applicants not remaining employed for the Company’s guarantee period.  Contract service revenues are recognized when services are rendered.

Recent Accounting Pronouncements

In May 2011, the FASB issued ASU No. 2011-04, “Fair Value Measurements (Topic 820): Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs,” (“ASU 2011-04”). ASU 2011-04 expands the disclosures for fair value measurements that are estimated using significant unobservable (Level 3) inputs. This new guidance is to be applied prospectively. This guidance was effective for the Company beginning January 1, 2012. The adoption of this standard did not materially affect the consolidated financial statements.

In July 2012, the FASB issued ASU 2012-02 – Testing indefinite-Lived Intangible Assets for Impairments (“ASU 2012-02”, which amends the guidance in ASC 350-30 on testing indefinite-lived intangible assets, other than goodwill, for impairments.  FASB issued ASU 2012-12 in response to feedback on ASU 2011-08, which amended the goodwill impairment testing requirements by allowing an entity to perform a qualitative impairment assessment before proceeding to the two-step impairment test.  Similarly, under ASU 2012-02, an entity testing an indefinite-lived intangible asset for impairment has the option of performing a qualitative assessment before calculating the fair value of the asset. If the entity determines, on the basis of quantitative factors, that the fair value of the indefinite-lived intangible asset is not more likely than note (i.e. a likelihood of more than 50 percent) impaired, the entity would not need to calculate the fair value of the asset.  ASU 2012-02 does note revise the requirement to test indefinite-lived intangible assets annually for impairment.  In addition, the ASU 2012-02 does not amend the requirement to test these assets for impairment between annual tests if there is a change in the events or circumstances; however, it does revise the examples of events and circumstances that an entity should consider in interim periods. ASU 201-02 is effective for annual and interim impairment tests performed for fiscal years beginning after September 15, 2012.  Early adoption is permitted.  The Company does not expect the adoption of this guidance to have a material effect on the Company’s consolidated financial statements.

18

Other recent accounting pronouncements issued by FASB, including its Emerging Issues Task Force (“EITF”), the American Institute of Certified Accountants (“AICPA”), and the SEC did not or are not believed by management to have a material impact on the Company’s present or future financial statements.

Item 7A. Quantitative and Qualitative Disclosure About Market Risk.

Not applicable.

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Item 8. Financial Statements and Supplementary Data.

	Page
Report of Independent Registered Public Accounting Firm	21
Consolidated Balance Sheet as of September 30, 2012 and September 30, 2011	22
Consolidated Statement of Operations for the years ended September 30, 2012 and September 30, 2011	23
Consolidated Statement of Shareholders’ Equity for the years ended September 30, 2012 and September 30, 2011	24
Consolidated Statement of Cash Flows for the years ended September 30, 2012 and September 30, 2011	25
Notes to Consolidated Financial Statements	26

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders

General Employment Enterprises, Inc.

Oakbrook Terrace, Illinois

We have audited the accompanying consolidated balance sheets of General Employment Enterprises, Inc. (the “Company”) as of September 30, 2012 and 2011, and the related consolidated statements of operations, shareholders’ equity, and cash flows for the years then ended. These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of General Employment Enterprises, Inc. as of September 31, 2012 and 2011, and the consolidated results of its operations and cash flows for each of the years then ended in conformity with US generally accepted accounting principles

/s/ FRIEDMAN LLP

New York, New York

March 29, 2013

21

GENERAL EMPLOYMENT ENTERPRISES, INC.
CONSOLIDATED BALANCE SHEETS
(In Thousands)
	September 30,			September 30,
	2012			2011
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	364		$	314
Accounts receivable, less allowances (2012 - $259; 2011 - $137)		6,761			6,604
Other		246			190
Total Current Assets		7,371			7,108
Property and equipment, net (2012 - $3,240; 2011 - $3,104)		518			409
Goodwill		1,106			1,280
Intangible assets, net		2,204			2,699
TOTAL ASSETS	$	11,199		$	11,496
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Short-term debt	$	2,404		$	1,938
Accounts payable		173			485
Accrued compensation		3,068			2,391
Other current liabilities		1,196			1,307
Total Current Liabilities		6,841			6,121
Long-term liabilities		253			681
Commitments and Contingencies
SHAREHOLDERS' EQUITY
Preferred stock; authorized - 100 shares; no par value;  issued and outstanding - none		-			-
Common stock, no-par value; authorized - 50,000 shares; issued and outstanding - 21,699 at September 30, 2012 and September 30, 2011		10,453			10,031
Accumulated deficit		(6,348	)		(5,337	)
Total Shareholders' Equity		4,105			4,694
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	$	11,199		$	11,496

The accompanying notes are an integral part of these consolidated financial statements.

22

GENERAL EMPLOYMENT ENTERPRISES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In Thousands, Except Per Share Data)
	Years Ended September 30,
	2012			2011
NET REVENUES:
Contract staffing services	$	45,190		$	31,921
Direct hire placement services		7,215			4,430
Management services		-			838
NET REVENUES		52,405			37,189
Cost of contract services		38,236			27,405
Selling, general and administrative expenses		14,308			8,841
Amortization of intangible assets		394			537
Loss on impairment of intangible assets and goodwill		274			1,126
Reduction of earn-out liability		-			(1,276	)
INCOME (LOSS) FROM OPERATIONS		(807	)		556
Interest expense		(204	)		(198	)
NET (LOSS) INCOME	$	(1,011	)	$	358
NET INCOME(LOSS) PER SHARE - BASIC	$	(0.05	)	$	0.02
NET INCOME(LOSS) PER SHARE - DILUTED	$	(0.05	)	$	0.02
WEIGHTED AVERAGE NUMBER OF SHARES - BASIC		21,699			18,394
WEIGHTED AVERAGE NUMBER OF SHARES - DILUTED		21,699			18,648

The accompanying notes are an integral part of these consolidated financial statements.

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GENERAL EMPLOYMENT ENTERPRISES, INC.
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
(In Thousands)
								Total
	Common Stock				Accumulated			Shareholders'
	Shares		Amount		Deficit			Equity
Balance, September 30, 2010		14,856	$	7,287	$	(5,695	)	$	1,592
Issuance of common stock for acquisitions		6,831		2,731		-			2,731
Exercises of stock options		12		5		-			5
Stock compensation expense		-		8		-			8
Net income		-		-		358			358
Balance, September 30, 2011		21,699	$	10,031	$	(5,337	)	$	4,694
Stock compensation expense				422					422
Net loss		-		-		(1,011	)		(1,011	)
Balance, September 30, 2012		21,699	$	10,453	$	(6,348	)	$	4,105

The accompanying notes are an integral part of these consolidated financial statements.

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GENERAL EMPLOYMENT ENTERPRISES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)
	Years Ended September 30,
	2012			2011
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income (Loss)	$	(1,011	)	$	358
Adjustments to reconcile net income (loss) to net cash and cash equivalents provided by (used in) operating activities:
Depreciation and amortization		546			713
Reduction of earn-out liability		-			(1,276	)
Loss on impairment of goodwill		173
Loss on impairment of other intangible assets		101			1,126
Stock compensation expense		422			8
Non cash interest expense		-			120
Provision for doubtful accounts		491			66
Changes in assets and  liabilities -
Accounts receivable		(648	)		(5,250	)
Accounts payable		(312	)		378
Accrued compensation		677			1,622
Other current items, net		(164	)		398
Long-term liabilities		(180	)		(553	)
Net cash provided by (used by) operating activities		95			(2,290	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of property and equipment		(261	)		(84	)
Partial payment of earn-out		(50	)		-
Acquisition of Ashley Ellis		(200	)		(200	)
Net cash used in investing activities		(511	)		(284	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Exercise of stock options		-			5
Net proceeds from short-term debt		466			1,938
Net cash provided by financing activities		466			1,943
Net increase (decrease) in cash and cash equivalents		50			(631	)
Cash and cash equivalents at beginning of year		314			945
Cash and cash equivalents at end of year	$	364		$	314
SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid for interest	$	182		$	66
Cash paid for taxes	$	-		$	-

NON-CASH FINANCING AND INVESTING ACTIVITIES:

In August 2011, the Company purchased certain assets of Ashley Ellis, LLC as discussed in Note 4 in exchange for 1,250 shares of stock valued at $331.

In November 2010, the Company purchased certain assets of DMCC Staffing, LLC and RFFG of Cleveland, LLC as discussed in Note 4 in exchange for 5,581 shares of stock valued at $2,400.

The accompanying notes are an integral part of these consolidated financial statements.

25

GENERAL EMPLOYMENT ENTERPRISES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. Description of Business

General Employment Enterprises, Inc. (the “Company”) provides staffing services through a network of branch offices located in major metropolitan areas throughout the United States.  The Company’s professional staffing services provide information technology, engineering and accounting professionals to clients on either a regular placement basis or a temporary contract basis.  The Company’s agricultural staffing services provide agricultural workers for farms and groves.  The Company’s industrial staffing business provides weekly temporary staffing for light industrial clients in Ohio and Pennsylvania.  There was no customer that represented more than 10% of the Company’s consolidated revenue in fiscal 2012, however the Company did have two large customers that represented approximately 17.4% and 11.5% of the Company’s consolidated revenue in fiscal 2011.

The Company experienced significant losses for the year ended September 30, 2012.  Management has implemented a strategy which included cost reduction efforts as well as identifying strategic acquisitions, financed primarily through the issuance of stock, to improve the overall profitability and cash flows of the Company.  In December 2010, the Company entered into an account purchase agreement with Wells Fargo Business Credit to provide working capital financing.  The account purchase agreement allows Wells Fargo to advance the Company funds on accounts receivable at its sole discretion.  In the event Wells Fargo elects not to advance us funds on our accounts receivable balance or the performance of theacquired entities does not meet our expectations, the Company could experience liquidity constraints.

2. Significant Accounting Policies and Estimates

The consolidated financial statements are prepared in conformity with accounting principles generally accepted in the United States of America and the rules of the United States Securities and Exchange Commission.

Principles of Consolidation

The consolidated financial statements include the accounts and transactions of the Company and its wholly-owned subsidiaries.  All significant inter-company accounts and transactions are eliminated in consolidation.

Estimates and Assumptions

Management makes estimates and assumptions that can affect the amounts of assets and liabilities reported as of the date of the financial statements, as well as the amounts of reported revenues and expenses during the periods presented.  Those estimates and assumptions typically involve expectations about events to occur subsequent to the balance sheet date, and it is possible that actual results could ultimately differ from the estimates.  If differences were to occur in a subsequent period, the Company would recognize those differences when they became known.  Significant matters requiring the use of estimates and assumptions include, but may not be limited to, deferred income tax valuation allowances, accounts receivable allowances, accounting for acquisitions, and evaluation of impairment.  Management believes that its estimates and assumptions are reasonable, based on information that is available at the time they are made.

Revenue Recognition

Direct hire placement service revenues are recognized when applicants accept offers of employment, less a provision for estimated losses due to applicants not remaining employed for the Company’s guarantee period.  Contract staffing service revenues are recognized when services are rendered.

Cost of Contract Staffing Services

The cost of contract services includes the wages and the related payroll taxes and employee benefits of the Company’s employees while they work on contract assignments.

26

Income Taxes

We record a provision for income taxes for the anticipated tax consequences of the reported results of operations using the asset and liability method. Under this method, we recognize deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the financial reporting and tax basis of assets and liabilities, as well as for operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using the tax rates that are expected to apply to taxable income for the years in which those tax assets and liabilities are expected to be realized or settled. We record a valuation allowance to reduce our deferred tax assets to the net amount that we believe is more likely than not to be realized.

We recognize tax benefits from uncertain tax positions only if we believe that it is more likely than not that the tax position will be sustained on examination by the taxing authorities based on the technical merits of the position. Although we believe that we have adequately reserved for our uncertain tax positions, we can provide no assurance that the final tax outcome of these matters will not be materially different. We make adjustments to these reserves when facts and circumstances change, such as the closing of a tax audit or the refinement of an estimate. To the extent that the final tax outcome of these matters is different than the amounts recorded, such differences will affect the provision for income taxes in the period in which such determination is made and could have a material impact on our financial condition and operating results. The provision for income taxes includes the effects of any accruals that we believe are appropriate, as well as the related net interest and penalties.

 Income or Loss per Share

Basic income or loss per share is based on the average number of common shares outstanding.  Diluted income per share is based on the average number of common shares and the dilutive effect of stock options.  Stock options are not considered to be dilutive during loss periods.  The diluted net loss per share in fiscal 2012 excludes approximately 589,000 stock options as they had an anti-dilutive effect.  The diluted net income per share includes the effect of 254,000 stock options in fiscal 2011.

Cash and Cash Equivalents

Highly liquid investments with a maturity of three months or less when purchased are considered to be cash equivalents.  At September 2012 and 2011, there were no cash equivalents.  The Company maintains deposits in financial institutions in excess of amounts guaranteed by the Federal Deposit Insurance Corporation.  Cash and cash equivalents are maintained at financial institutions and, at times, balances may exceed federally insured limits. We have never experienced any losses related to these balances. All of our non-interest bearing cash balances were fully insured at September 30, 2012 due to a temporary federal program in effect from December 31, 2010 through December 31, 2012. Under the program, there is no limit to the amount of insurance for eligible accounts. Beginning 2013, insurance coverage will revert to $250,000 per depositor at each financial institution, and our non-interest bearing cash balances may again exceed federally insured limits.

Accounts Receivable

The Company extends credit to its various customers based on evaluation of the customer’s financial condition and ability to pay the Company in accordance with the payment terms. An allowance for placement falloffs is recorded, as a reduction of revenues, for estimated losses due to applicants not remaining employed for the Company’s guarantee period.  An allowance for doubtful accounts is recorded, as a charge to bad debt expense, where collection is considered to be doubtful due to credit issues.  These allowances together reflect management’s estimate of the potential losses inherent in the accounts receivable balances, based on historical loss statistics and known factors impacting its customers.  The nature of the contract service business, where companies are dependent on employees for the production cycle allows for a small accounts receivable allowance.  Based on management’s review of accounts receivable, an allowance for doubtful accounts of approximately $259,000 and $137,000 is considered necessary as of September 30, 2012 and September 30, 2011, respectively.  The Company charges uncollectible accounts against the allowance once the invoices are deemed unlikely to be collectible.  The Company does not accrue interest on past due receivables.

Property and Equipment

Property and equipment are recorded at cost.  Depreciation expense is calculated on a straight-line basis over estimated useful lives of five years for computer equipment and two to ten years for office equipment, furniture and fixtures.  The Company capitalizes computer software purchased or developed for internal use and amortizes it over an estimated useful life of five years.  The carrying value of property and equipment is reviewed for impairment whenever events or changes in circumstances indicate that it may not be recoverable.  If the carrying amount of an asset group is greater than its estimated future undiscounted cash flows, the carrying value is written down to the estimated fair value.  There was no impairment of property and equipment for the years ended September 30, 2012 and September 30, 2011.

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Goodwill

Goodwill represents the excess of cost over the fair value of the net assets acquired in the June 1, 2010 acquisition of On-Site Services, Inc., the November 1, 2010 purchase of DMCC Staffing, LLC and RFFG of Cleveland, LLC and the Ashley Ellis, LLC acquisition on September 1, 2011.  The Company assesses goodwill for impairment at least annually.  The Company early adopted, Intangibles – Goodwill and Other (Topic 350): Testing Goodwill for Impairment, which allows the Company to first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If the entity determines that this threshold is not met, then performing the two-step impairment test is unnecessary.  An impairment loss would be recognized to the extent the carrying value of goodwill exceeds its implied fair value.

Fair Value Measurement

The Company follows the provisions of the accounting standard which defines fair value, establishes a framework for measuring fair value and enhances fair value measurement disclosure. Under these provisions, fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (i.e., the “exit price”) in an orderly transaction between market participants at the measurement date.

The standard establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use on unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The hierarchy is described below:

Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs.

Level 2: Observable prices that are based on inputs not quoted on active markets, but corroborated by market data.

Level 3: Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs.

The fair value of the Company’s current assets and current liabilities approximately their carrying values due to their short term nature.  The carrying value of the Company’s long-term liabilities represents their fair value based on level 3 inputs further disclosed in note 11.  The Company’s goodwill and other intangible assets are measured at fair value on a non-recurring basis using level 3 inputs, as further disclosed in Notes 4,5 and 8.

Intangible Assets

Customer lists, non-compete agreements, customer relationships, management agreements and trade names were recorded at their estimated fair value at the date of acquisition and are amortized over their estimated useful lives ranging from two to ten years using both accelerated and straight-line methods.

Impairment of Long-lived Assets

The Company records an impairment of long-lived assets used in operations, other than goodwill, when events or circumstances indicate that the asset might be impaired and the estimated undiscounted cash flows to be generated by those assets over their remaining lives are less than the carrying amount of those items.  The net carrying value of assets not recoverable is reduced to fair value, which is typically calculated using the discounted cash flow method.

Stock-Based Compensation

Compensation expense is recorded for the fair value of stock options issued to directors and employees.  The expense is measured as the estimated fair value of the stock options on the date of grant and is recorded over the vesting periods.

Advertising

The Company expenses advertising costs as incurred.  Advertising costs were approximately $870,000 and $541,000 for the years ended September 30, 2012 and 2011, respectively.

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Segment Data

The Company has three operating business segments a) Contract staffing services, b) Direct hire placement services and c) Management services.  These operating segments were determined based primarily on how the chief operating decision maker views and evaluates our operations. Operating results are regularly reviewed by the chief operating decision maker to make decisions about resources to be allocated to the segment and to assess its performance. Other factors, including type of business, type of employee, length of employment, revenue recognition are considered in determining these operating segments.  Management services are no longer in operations during the year ended September 30, 2012.

3. Recent Accounting Pronouncements

In May 2011, the FASB issued ASU No. 2011-04, “Fair Value Measurements (Topic 820): Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs,” (“ASU 2011-04”). ASU 2011-04 expands the disclosures for fair value measurements that are estimated using significant unobservable (Level 3) inputs. This new guidance is to be applied prospectively. This guidance was effective for the Company beginning January 1, 2012. The adoption of this standard did not materially affect the consolidated financial statements.

In July 2012, the FASB issued ASU 2012-02 – Testing indefinite-Lived Intangible Assets for Impairments (“ASU 2012-02”, which amends the guidance in ASC 350-30 on testing indefinite-lived intangible assets, other than goodwill, for impairments.  FASB issued ASU 2012-12 in response to feedback on ASU 2011-08, which amended the goodwill impairment testing requirements by allowing an entity to perform a qualitative impairment assessment before proceeding to the two-step impairment test.  Similarly, under ASU 2012-02, an entity testing an indefinite-lived intangible asset for impairment has the option of performing a qualitative assessment before calculating the fair value of the asset. If the entity determines, on the basis of quantitative factors, that the fair value of the indefinite-lived intangible asset is not more likely than note (i.e. a likelihood of more than 50 percent) impaired, the entity would not need to calculate the fair value of the asset.  ASU 2012-02 does note revise the requirement to test indefinite-lived intangible assets annually for impairment.  In addition, the ASU 2012-02 does not amend the requirement to test these assets for impairment between annual tests if there is a change in the events or circumstances; however, it does revise the examples of events and circumstances that an entity should consider in interim periods. ASU 201-02 is effective for annual and interim impairment tests performed for fiscal years beginning after September 15, 2012.  Early adoption is permitted.  The Company does not expect the adoption of this guidance to have a material effect on the Company’s consolidated financial statements.

Other recent accounting pronouncements issued by FASB, including its Emerging Issues Task Force (“EITF”), the American Institute of Certified Accountants (“AICPA”), and the SEC did not or are not believed by management to have a material impact on the Company’s present or future financial statements.

4. Acquisitions

In connection with the application of purchase accounting, the Company recorded its identifiable intangible assets at fair value.  Fair value of the intangible assets was determined primarily through the use of a discounted cash flow analysis.  The discounted cash flow analysis projected the estimated future cash flows to be generated by the underlying assets and discounted these at a rate reflecting perceived business and financial risks.  The projected cash flow estimates used in the discounted cash flow analysis are based on management’s best estimate and actual results may differ.  The valuation of these intangible assets is based predominately on Level 3 inputs.

Ashley Ellis, LLC

On August 31, 2011, General Employment Enterprises, Inc. (the “Company”) entered into an asset purchase agreement with Ashley Ellis LLC, an Illinois limited liability company (“Ashley Ellis”), and Brad A. Imhoff (the “Ashley Ellis Asset Purchase Agreement”), for the purchase of certain assets of Ashley Ellis, primarily customer lists, comprising Ashley Ellis’ services business.  Ashley Ellis’ services business was operated from offices in Illinois, Texas and Georgia and provided services related to the recruitment and placement of technical personnel.  The Ashley Ellis Asset Purchase Agreement was deemed effective on September 1, 2011.

29

Brad A. Imhoff is the brother of Herbert F. Imhoff, Jr., a former director and President of the Company who retired from all positions effective January 31, 2013.  Brad A. Imhoff and Ashley Ellis, an entity of which Brad A. Imhoff is the sole member and Chief Executive Officer, were parties to the transaction.  As consideration for the assets, the Company paid Ashley Ellis $200,000 on the date of closing and paid Ashley Ellis an additional $200,000 within six months of closing.  The Company also issued to Ashley Ellis 1,250,000 restricted shares of the Company’s common stock.  As the sole member of Ashley Ellis, Brad A. Imhoff has an interest in the entire consideration paid by the Company to Ashley Ellis for the assets.

In connection with the transactions contemplated by the Ashley Ellis Asset Purchase Agreement, on August 31, 2011, the Company and Ashley Ellis entered into a registration rights agreement (the “Registration Rights Agreement”), pursuant to which Ashley Ellis was granted certain piggyback registration rights with respect to the Shares to be issued to Ashley Ellis under the Ashley Ellis Asset Purchase Agreement.  The Registration Rights Agreement contains certain indemnification provisions for the benefit of the Company and Ashley Ellis and other customary provisions.  The total consideration is summarized as follows:

In Thousands
Stock consideration	$	331
Cash consideration		400
Total consideration for acquisition	$	731

The following table summarizes the approximate fair value of the assets acquired and liabilities assumed at the date of closing.

In Thousands
Property and Equipment	$	114
Intangible assets – trade name		17
Intangible assets – customer relationships		577
Goodwill		23
Total fair value of assets acquired	$	731

The assets purchased from Ashley Ellis constitute a business and as such, the acquisition of these assets was accounted for as a business combination. The assets purchased related to the Ashley Ellis, LLC acquisition was not considered a significant acquisition.  The results of operations of Ashley Ellis, LLC are included in the Company’s statement of operations from the effective date of the acquisition, September 1, 2011.  Goodwill and the intangible assets acquired in this transaction are deductible for tax purposes.

Acquisition of DMCC Staffing, LLC and RFFG of Cleveland, LLC

Effective November 1, 2010, the Company, through its wholly-owned subsidiary, Triad Personnel Services, Inc. (Triad), entered into an asset purchase agreement (the “Asset Purchase Agreement”), dated as of October 29, 2010, with DMCC Staffing, LLC (“DMCC”), RFFG of Cleveland, LLC (“RFFG of Cleveland”), and Thomas J. Bean, for the purchase of certain assets of DMCC and RFFG of Cleveland, primarily customer lists, comprising DMCC’s and RFFG of Cleveland’s services business.  Thomas Bean was the beneficial owner of approximately 9.9% of the Company’s outstanding shares prior to this acquisition.  The business is primarily operated from offices in Ohio and provides labor and human resource solutions, including temporary staffing, human resources and payroll outsourcing services, labor and employment consulting and workforce solutions.  When the assets were purchased, there was only one primary customer.

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The closing of the Asset Purchase Agreement was subject to certain conditions, including entry into a definitive management and services agreement for the management of the businesses of certain affiliates of DMCC, RFFG of Cleveland and Mr. Bean (the “Management Agreement”) by the Company.  On November 30, 2010, Business Management Personnel, Inc. (“BMP”), a wholly-owned subsidiary of the Company, entered into the Management Agreement, effective as of November 1, 2010, with RFFG, LLC (“RFFG”). The Management Agreement was terminated in July 2011. Refer to Note 5, Entry into Management Agreement for a further description.

The assets purchased from RFFG of Cleveland and DMCC constitute businesses and as such the acquisition of these assets were accounted for as a business combination. Pursuant to the Asset Purchase Agreement, the Company agreed to issue $2,400,000 in shares of its common stock (5,581,395 shares based on the December 30, 2010 closing date) to DMCC and RFFG of Cleveland upon receipt of (a) stockholder approval of the transaction and of an increase to the Company’s authorized Common Stock and (b) approval of an additional listing application by the NYSE MKT.  On March 24, 2011, the Company received written consents in lieu of a meeting of shareholders from the holders of 71.9% of the shares of Common Stock, (i) approving the issuance of 5,581,395 shares of the Common Stock to DMCC Staffing and RFFG of Cleveland pursuant to the Asset Purchase Agreement and the issuance of any additional shares of Common Stock to DMCC and RFFG of Cleveland as may be necessary pursuant to certain earn-out payment provisions under the Asset Purchase Agreement; and (ii) approving an amendment to the Articles of Incorporation of the Company to increase the number of authorized shares of capital stock from 20,100,000 shares to 50,100,000 shares and to increase the number of authorized shares of Common Stock from 20,000,000 shares to 50,000,000 shares.

Commencing in 2011, if the aggregate EBITDA of the businesses acquired, plus any management fees paid to the Company under the Management Agreement meets certain targets (each, an “EBITDA Target”) over a four-year period ending December 31, 2014 (the “Earnout Period”), the Company will be required to make earn-out payments to DMCC and RFFG of Cleveland, each payable in three equal installments.  In the event that an EBITDA Target for a certain period is not met, the earn-out payment in respect to such period will be reduced proportionately.  The EBITDA Targets are $300,000, $600,000, $900,000 and $1,200,000 for each of the three-, six-, nine- and twelve-month periods, respectively, in the fiscal year ending December 31, 2011, and earn-out payments will consist of quarterly payments of $150,000, payable in three equal monthly installments, if the relevant EBITDA Targets are met.  Starting in the fiscal year ending December 31, 2012, the EBITDA Targets will be adjusted annually to reflect the EBITDA for the twelve-month period ending on December 31st of the most recently completed fiscal year (each, an “Annual EBITDA Target”) and earn-out payments for the year will be adjusted to equal 50% of the relevant Annual EBITDA Target divided by four.  At the end of each fiscal year during the Earnout Period, if the aggregate EBITDA for the 12-month period then ended is greater than the Annual EBITDA Target for such year, then the Company will pay to DMCC and RFFG of Cleveland the amount of such excess, 50% in cash and 50% in shares of common stock.  Through September 30, 2012, $232,000 has been earned related to the purchase agreement earn-out, net of off-sets, and the Company made one $50,000 cash payment against this liability.

The Company is currently in discussions with RFFG to amend the Asset Purchase Agreement as it relates to the earn-out since the value of the Management Agreement was a significant value of the original agreement and was terminated in July 2011.

The accounting guidance requires that contingent consideration be added to the purchase price and the resultant liability be recorded at fair value.  Given the terms of the earn-out provisions of the Asset Purchase Agreement, the Company believes that the earn-out will be paid and accordingly, has included the fair value of the projected total earn-out payments in the total consideration paid for the acquisition.  Any subsequent changes in the estimated fair value of this contingent consideration will be recorded in the Company’s statement of operations.  At September 30, 2012 the expected earn-out liability is approximately $845,000 based on the originally present value accounting for the transaction.

The total consideration is summarized as follows:

In Thousands
Stock consideration	$	2,400
Earn-out consideration		2,198
Total consideration for acquisition	$	4,598

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The following table summarizes the approximate fair value of the assets acquired and liabilities assumed at the date of closing.

In Thousands
Property and equipment	$	5
Intangible assets - management agreement		1,396
Intangible assets - customer relationships		2,113
Goodwill		1,084
Total fair value of assets acquired	$	4,598

Goodwill and the intangible assets acquired in this transaction are deductible for tax purposes.

The Company wrote off the intangible asset associated with the management agreement of approximately $1,126,000 and reduced the earn-out liability by $1,276,000 when it was determined that RFFG ceased doing business on July 15, 2011 and therefore, future management fees would no longer would be earned, as discussed further in Note 5.

As with any asset purchase of a business the purchaser may be held accountable for the seller’s debts and liabilities where; (i) there is an express or implied agreement of assumption; (ii) the transaction amounts to a de facto consolidation or merger of the buyer or seller corporation; (iii) the purchaser is merely a continuation of the seller; or (iv) the transaction is for the fraudulent purpose of escaping liability for the seller’s obligations.  There are always several factors in the determination of any successor corporation legal liabilities related to the predecessor company.   Other than the current litigation related to the Ohio Bureau of Workers Compensation, the Company has not been noticed of any additional claims, however additional claims could be material to the business.

The loss of a significant customer by Onsite during the year ended September 30, 2012 had a negative effect on future earnings and cash flows from operations, and is a factor indicating the possibility of future impairment to the Company’s goodwill. The Company has determined that based on expected future cash flows there was an impairment of the related intangible assets of approximately $274,000.

5. Entry into Management Service Agreement

In conjunction with the Asset Purchase Agreement for DMCC and RFFG of Cleveland, BMP, an Ohio corporation and a wholly-owned subsidiary of the Company, entered into a management service agreement (the “Management Agreement”) with RFFG effective November 1, 2010.

Pursuant to the Management Agreement, BMP agreed to provide services to RFFG to operate its day-to-day business, including services related to accounting, sales, finance, workers’ compensation, benefits, physical locations, information technologies and employees.  The Management Agreement provided that additional services may be added if BMP and RFFG mutually agree to the cost to be charged by BMP for such services and as long as BMP has the resources to provide such services.

In consideration of the services provided under the Management Agreement, RFFG, LLC agreed to pay BMP monthly fees that approximate 6% of its gross revenues on an annual basis.  For the year ended September 30, 2011, the Company recorded approximately $838,000 of revenue related to this agreement.  As of September 30, 2011, BMP has $225,000 of management fee receivable.

Due to an unresolved issue with the Ohio Bureau of Workers Compensation, RFFG ceased operations as of July 15, 2011 and, as a result, the Management Agreement was effectively terminated.  As a result, the Company recorded a loss on impairment of intangible assets of $1,126,000 (as discussed further in Note 9), offset by income of $1,276,000 for the reduction of an associated earn-out liability.   There was approximately $140,000 unpaid related to this Management Agreement, which was offset against amounts owed related to the earn-out agreement.  In addition, since the Company was providing certain management services, RFFG and the transactions between RFFG and the Company were considered to be related party in nature because Thomas Bean was a 10% owner of the Company at the time.

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There continued to be some expenses related to transportation, fuel and utilities that were paid by the Company to RFFG after RFFG ceased operations and the Management Agreement was effectively terminated.

6. Placement Service Revenues

The provision for falloffs and refunds, which is reflected in the consolidated statements of operations as a reduction of placement service revenues, was $1,026,000 in fiscal 2012 and $695,000 in fiscal 2011.

7. Property and Equipment

Property and equipment consisted of the following as of September 30th:

(In Thousands)	Useful Lives	2012			2011
Computer software	5 years	$	1,447		$	1,447
Office equipment, furniture and fixtures and leasehold improvements	2 to 10 years		2,311			2,066
Total property and equipment, at cost			3,758			3,513
Accumulated depreciation and amortization			(3,240	)		(3,104	)
Property and equipment, net		$	518		$	409

Disposals of property and equipment, consisting primarily of fully-depreciated office furniture and equipment, had an original cost of $16,000 and $24,000 in fiscal 2012 and 2011, respectively.  Leasehold improvements are amortized over the term of the lease.

Depreciation expense for the years ended September 30, 2012 and 2011 was approximately $152,000 and $176,000, respectively.

8. Goodwill and Intangible Assets

Goodwill

Goodwill represents the excess of cost over the fair value of the net assets acquired from various acquisitions. Goodwill is not amortized.  The Company performs a goodwill impairment test annually, by reporting unit, in the fourth quarter of the fiscal year, or whenever potential impairment triggers occur.  Should the two-step process be necessary, the first step of the impairment test identifies potential impairment by comparing the fair value of a reporting unit to its carrying value including goodwill. In applying a fair-value-based test, estimates are made of the expected future cash flows to be derived from the reporting unit. Similar to the review for impairment of other long-lived assets, the resulting fair value determination is significantly impacted by estimates of future margins, capital needs, economic trends and other factors. If the carrying value of the reporting unit exceeds its fair value, the second step of the impairment test is performed to measure the amount of impairment loss, if any. The second step of the impairment test compares the implied fair value of the reporting unit goodwill with the carrying amount of that goodwill. An impairment loss would be recognized to the extent the carrying value of goodwill exceeds its implied fair value.

The loss of a significant customer by Onsite during the year ended September 30, 2012 had a negative effect on future earnings and cash flows from operations, and is a factor indicating the possibility of future impairment to the Company’s goodwill. The Company has determined that based on expected future cash flows there was an impairment of the related intangible assets of $101,000 and goodwill of approximately $173,000.

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Intangible Assets

As of September 30, 2012

(In Thousands)	Cost		Accumulated Amortization		Loss on impairment of Intangible assets		Net Book Value
Non-Compete	$	89	$	48		41	$	—
Customer Relationships		2,913		662		60		2,191
Management Agreement		1,396		270		1,126		—
Trade Name		17		4		—		13
	$	4,415	$	984	$	1,227	$	2,204

As of September 30, 2011

(In Thousands)	Cost		Accumulated Amortization		Loss on impairment of Intangible assets		Net Book Value
Non-Compete	$	89	$	24		—	$	65
Customer Relationships		2,913		296		—		2,617
Management Agreement		1,396		270		1,126		—
Trade Name		17		—		—		17
	$	4,415	$	590	$	1,126	$	2,699

Amortization expense was approximately $394,000 and approximately $537,000 for the years ended September 30, 2012 and 2011, respectively.

Finite life intangible assets are comprised of a non-compete agreement, management agreement, trade name and customer relationships.  The non-compete agreement and trade name are amortized on a straight – line basis over the estimated useful lives of 5 years.  The customer relationships are amortized based on the future undiscounted cash flows over estimated remaining useful lives of three to 10 years.  The management agreement intangible was being amortized over the five year term of the agreement.  Over the next five years, annual amortization expense for these finite life intangible assets will be $393,000 in 2013, $376,000 in 2014, $359,000 in 2015, $340,000 in 2016 and $322,000 in 2017 and $414,000 thereafter.

Long-lived assets, such as purchased intangibles subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.  The Company evaluates, regularly, whether events and circumstances have occurred that indicate possible impairment and relies on a number of factors, including operating results, business plans, economic projections, and anticipated future cash flows.  The Company uses an estimate of the future undiscounted net cash flows of the related asset or asset group over the remaining life in measuring whether the assets are recoverable.

During the year ended, September 30, 2012, the Company recorded an impairment charge of approximately $101,000 for the remaining unamortized amount of the non-compete and a certain amount of the customer relationship intangible asset related to the agricultural operation.  In addition the Company recorded an impairment charge of approximately $173,000 related to the goodwill of the agriculture operation.   The impairment charge represents the difference between the fair value and the carrying value of the intangible assets.  The agricultural operation has limited margins and lost a large customer and management determined that the present value of the future cash flows associated with the operation did not support the recorded value.

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During the year ended, September 30, 2011, the Company recorded an impairment charge of $1,126,000 for the remaining unamortized amount of the Management Agreement intangible asset.  The impairment charge represents the difference between the fair value and the carrying value of the intangible asset.  No future cash flows associated with the Management Agreement are expected as the management agreement was effectively terminated as a result of the managed entity, RFFG, ceasing operations in July 2011.

9. Short-term Debt

The Company, through December 2010, had a loan and security agreement with Crest mark Bank for the financing of its accounts receivable.  Under the terms, the Company could borrow up to 85% of its eligible accounts receivable, not to exceed $3,500,000.  The loan was secured by accounts receivable and other property of the Company.  Interest was charged at the rate of 1% above the prime rate.  Interest expense under this agreement was $4,500 for the year ending September 30, 2011.  In addition, the agreement required a maintenance fee of $3,500 per month and an annual loan fee of 1% of the maximum borrowing amount under the agreement.  The Company incurred $29,000 of fees related to this agreement during the year ended September 30, 2011.

In December 2010, the Company terminated its agreement with Crest mark Bank and entered into a two-year, $3,000,000 account purchase agreement (“AR Credit Facility”) with Wells Fargo Bank N.A. (“Wells Fargo”) which has been subsequently amended.  The AR Credit Facility as amended, provides for borrowings, on a revolving basis, of up to 85% of the Company’s eligible accounts receivable less than 90 days old and bears interest at a rate equal to the three month LIBOR plus 5.25% (effective rate was 5.65% as of September 30, 2012 and 5.75 % as of September 30, 2011).  Under the terms and subject to the conditions in the agreement, Wells Fargo may determine which receivables are eligible receivables, may determine the amount it will advance on any such receivables, and may require the Company to repay advances made on receivables and thereby repay amounts outstanding under the AR Credit Facility on demand.  Wells Fargo also has the right to require the Company to repurchase receivables that remain outstanding 90 days past their invoice date.  The Company continues to be responsible for the servicing and administration of the receivables purchased and carries the receivables and any outstanding borrowings on its consolidated balance sheet.

On January 14, 2013, the Company and Wells Fargo Bank, National Association entered into a Fifth Amendment (the “Fifth Amendment”) to its AR Credit Facility.  The Fifth Amendment extended the term of the AR Credit Facility to December 14, 2013.  Notwithstanding the foregoing extension, Wells Fargo may issue a written notice to the Company shortening the term of the of the AR Credit Facility to a date 60 days following such notice in the event that (i) the Company is not dismissed without prejudice from a recently brought lawsuit entitled Derby Capital LLC and Derby Capital JOB LLC, as plaintiffs, vs. Trinity HR Services, LLC, et al., as defendants, a lawsuit seeking to establish relative ownership among stockholders which the Company believes it should not be a party to, (ii) the Company fails to furnish Wells Fargo its audited financial statements for its fiscal year ended September 30, 2012 by March 15, 2013 or if the results in such audited financial statements are not satisfactory to Wells Fargo in its sole discretion,  (iii) background checks of newly appointed officers of the Company are unsatisfactory to Wells Fargo in its sole discretion, or (iv) significant changes have occurred to the composition of the Company’s Board of Directors as determined by Wells Fargo in its sole discretion.  In March 2013, the Company and Wells Fargo entered into a Sixth Amendment that extended the required delivery date on certain of the foregoing requirements, such as the audited financial statements, until April 30, 2013.  To date, the Company has not received notice from Wells Fargo of any intent to shorten the term of the AR Credit Facility.

The AR Credit Facility with Wells Fargo Bank includes certain covenants which require compliance until termination of the agreement.  As of September 30, 2012, the Company was in compliance with all such covenants.  

The Company believes that the borrowing availability provided by the AR Credit Facility will be adequate to fund the increase in working capital needs resulting from the acquisitions of certain assets of On-Site, RFFG of Cleveland, DMCC and Ashley Ellis, LLC.

As of September 30, 2012, the borrowing base availability under this agreement was $596,000 and the outstanding borrowings, which are classified as short-term debt on the 2012 consolidated balance sheet, were approximately $2,404,000.  Total interest expense related to the line of credit for the years ending September 30, 2012 and September 30, 2011 approximated $176,000 and $79,000, respectively.

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The AR Credit Facility includes certain covenants which require compliance until termination of the agreement.  As of the date of March 29, 2013, the Company was in compliance with all such covenants.  

10. Other Current Liabilities

Other current liabilities consisted of the following:

	September 30th
(In Thousands)	2012		2011
Accrued expenses	$	282	$	201
Accrued rent		-		31
Second Installment of the Ashley Ellis, LLC purchase price		-		200
Contingent earn-out liability due within one year		834		803
Deferred rent		80		72
Total other current liabilities	$	1,196	$	1,307

11. Long-Term Liabilities

In connection with the completion of the sale of shares of common stock to PSQ in fiscal 2009, the Company’s then Chairman, Chief Executive Officer and President (the “former CEO”) retired from those positions and his employment agreement with the Company was replaced by a new consulting agreement.  Under the consulting agreement, the Company became obligated to pay an annual consulting fee of $180,000 over a five-year period and to issue 500,000 shares of common stock to the former CEO for no additional consideration.  During fiscal 2009, the Company recorded a liability for the net present value of the future payments in the amount of $790,000 and recorded additional common stock in the amount of $280,000 based on a quoted market price of $.56 per share on the date of the award.  As of September 30, 2012, the liability for future payments was reflected on the consolidated balance sheet as accrued compensation of $180,000 and long-term liability of $100,000.  As of September 30, 2011, the liability for future payments was reflected on the consolidated balance sheet as accrued compensation of $180,000 and a long-term liability of $280,000.

In November 2010, in conjunction with the purchase of RFFG of Cleveland and DMCC the Company accrued an earn-out liability as discussed in Note 4, which was subsequently reduced by $1,276,000.  There is no longer a remaining long-term earn-out liability on September 30, 2012.

12. Common Stock

In November 2010, the Company issued 5,581,395 shares of common stock in connection with the acquisition of DMCC and RFFG of Cleveland.

In September 2011, the Company issued 1,250,000 shares of its common stock in connection with the acquisition of Ashley Ellis, LLC.

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13. Stock Option Plans

As of September 30, 2012, there were stock options outstanding under the Company’s 1995 Stock Option Plan, Second Amended and Restated 1997 Stock Option Plan, 1999 Stock Option Plan and the 2011 Company Incentive Plan.  All four plans were approved by the shareholders.  The 1995 Stock Option Plan and the 1999 Stock Option Plan have expired, and no further options may be granted under those plans.  During fiscal 2009, the Second Amended and Restated 1997 Stock Option Plan was approved by the Board and shareholders to make an additional 592,000 options available for granting and as of September 30, 2012 there were 700,840 shares available for issuance under the Second Amended and Restated 1997 Stock Option Plan.  As of September 30, 2012 there were 500,000 shares available for issuance under the 2011 Company Incentive Plan.  The plans granted specified numbers of options to non-employee directors, and they authorized the Compensation Committee of the Board of Directors to grant either incentive or non-statutory stock options to employees.  Vesting periods are established by the Compensation Committee at the time of grant.  All stock options outstanding as of September 30, 2012 were non-statutory stock options, had exercise prices equal to the market price on the date of grant, and had expiration dates ten years from the date of grant.

A summary of stock option activity is as follows:

	Year Ended September 30
(Number of Options in Thousands)	2012			2011
Number of options outstanding:
Beginning of year		301			388
Granted		1,747			—
Exercised		—			(12	)
Terminated		(301	)		(75	)
End of year		1,747			301
Number of options exercisable at end of year		1,658			255
Number of options available for grant at end of year		1,201			731
Weighted average option prices per share:
Granted during the year	$	.41		$	—
Exercised during the year		—			.40
Terminated during the year		—			1.26
Outstanding at end of year		.38			.95
Exercisable at end of year		.40			1.00

Stock options outstanding as of September 30, 2012 were as follows (number of options in thousands):

Range of Exercise Prices	Number Outstanding		Weighted Average Price		Number Exercisable		Weighted Average Price		Average Remaining Life (Years)
Under $1.00		1,747	$	.38		1,658	$	.40		4
$1.25 to $2.39

As of September 30, 2012, the aggregate intrinsic value of outstanding stock options and exercisable stock options was $0.19.  There were no stock options exercised during the year.

The average fair value of stock options granted was estimated to be $0.26 per share in fiscal 2012.  No stock options were issued in fiscal year 2011.   This estimate was made using the Black-Scholes option pricing model and the following weighted average assumptions:

	2012			2011
Expected option life (years)		5.0
Expected stock price volatility		76	%
Expected dividend yield		—	%
Risk-free interest rate		.91	%

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Stock-based compensation expense attributable to stock options was $422,000 in fiscal 2012 and $8,000 in fiscal 2011.  As of September 30, 2012, there was approximately $46,000 of unrecognized compensation expense related to unvested stock options outstanding, and the weighted average vesting period for those options was 2.5 years.

14. Income Taxes

The components of the provision for income taxes are as follows:

	Year Ending September 30,
(In Thousands)	2012			2011
Current tax provision	$	—		$	—
Deferred tax provision (credit) related to:
Temporary differences
Stock option Expense		74			2
Deferred compensation expense		(60	)		(57	)
Vacation expense		39			32
Intangible assets		94			(272	)
Allowance for doubtful accounts		46			19
Other		(45	)		(24	)
Loss carryforwards		(194)			104
Valuation allowances		46			196
Provision for income taxes	$	—		$	—

The differences between income taxes calculated at the 34% statutory U.S. federal income tax rate and the Company’s provision for income taxes are as follows:

	Year Ended September 30,
(In Thousands)	2012			2011
Income tax provision at statutory federal tax rate	$	50			$	122
Valuation allowance		(50	)			(122	)
Provision for income taxes	$	—			$	—

The net deferred income tax asset balance related to the following:

	Year Ended September 30,
(In Thousands)	2012			2011
Temporary differences
Stock option Expense	$	217		$	138
Deferred compensation expense		120			184
Vacation expense		30			47
Intangible assets		107			282
Allowance for doubtful accounts		104			55
Other		85			105
Net operating loss carryforwards		3,560			3,366
Valuation allowances		(4,223	)		(4,177	)
Net deferred income tax asset	$	—		$	—

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As of September 30, 2012 there were approximately $8,900,000 of losses available to reduce federal taxable income in future years through 2031, and there were approximately $7,525,000 of losses available to reduce state taxable income in future years, expiring from 2012 through 2031.  Due to common stock transactions in the current and prior years, it is likely that the Company will be limited by Section 382 of the Internal Revenue Code as to the amount of net operating losses that may be used in future years.  The Company is currently evaluating the effects of any such limitation.

Future realization of the tax benefits of existing temporary differences and net operating loss carryforwards ultimately depends on the existence of sufficient taxable income within the carryforward period.  As of September 30, 2012 and 2011, the Company performed an evaluation to determine whether a valuation allowance was needed.  The Company considered all available evidence, both positive and negative, which included the results of operations for the current and preceding years.  The Company also considered whether there was any currently available information about future years.  Because long-term contracts are not a significant part of the Company’s business, future results cannot be reliably predicted by considering past trends or by extrapolating past results.  Moreover, the Company’s earnings are strongly influenced by national economic conditions and have been volatile in the past.  Considering these factors, the Company determined that it was not possible to reasonably quantify future taxable income.  The Company determined that it is more likely than not that all of the deferred tax assets will not be realized.  Accordingly, the Company maintained a full valuation allowance as of September 30, 2012 and 2011.

As a result of continuing losses, we have determined that it is more likely than not that we will not realize the benefits of the deferred tax assets and therefore we have recorded a valuation allowance to reduce the carrying value of the deferred tax assets to zero. As a result, the valuation allowance on our net deferred tax assets decreased by approximately $131,000 for the year ended September 31, 2012.

We file federal and state income tax returns in jurisdictions with varying statutes of limitations. Due to our net operating loss carryforwards, our income tax returns generally remain subject to examination by federal and most state tax authorities. We are not currently under examination in any federal or state jurisdiction.

15. Contingencies and Commitments

In March 2012, the Company became aware of a lien on the business by the Ohio Bureau of Workers Compensation for $229,000, which has been fully accrued for.  The Company believes this claim represents unpaid workers compensation premium for a period prior to the acquisition of certain assets of RFFG of Cleveland in November 2010.  The Company is currently defending its position in this matter.

As of March 28, 2013, there were no other material legal proceedings pending against the Company.

Lease

The Company leases space for all of its branch offices, which are located either in downtown or suburban business centers, and for its corporate headquarters.  Branch offices are generally leased over periods from three to five years.  The corporate office lease expires in 2015.  The leases generally provide for payment of basic rent plus a share of building real estate taxes, maintenance costs and utilities.

Rent expense was $ 1,028,000 in fiscal 2012 and $617,000 in fiscal 2011.  As of September 30, 2012, future minimum lease payments due under non-cancelable lease agreements having initial terms in excess of one year, including certain closed offices, totaled approximately $2,200,000, as follows: fiscal 2013 - $922,000, fiscal 2014 - $733,000, fiscal 2015 - $424,000, fiscal 2016 - $99,000 and thereafter - 22,000.

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16. Segment Data

As a result of the acquisition of certain of the assets of DMCC and RFFG of Cleveland and entry into the Management Agreement discussed above, the Company’s internal reporting was adjusted and as a result, the Company re-assessed its segment presentation.  Accordingly, the Company’s segment disclosures were revised in the current year.

The Company provides the following distinctive services: (a) direct hire placement services, (b) temporary professional services staffing in the fields of information technology, engineering, and accounting, (c) temporary staffing in the agricultural industry, (d) temporary light industrial staffing and (e) management services.  Inter-segment net service revenues are not significant.  Revenues generated from the temporary professional services staffing, temporary staffing in the agricultural industry and light industrial staffing are classified as contract staffing services revenues in the statements of operations.  Selling, general and administrative expenses are not separately allocated among agricultural, professional services or industrial staffing services within the contract staffing services sector for internal reporting purposes.

As of March 28, 2013, there were no other material legal proceedings pending against the Company.

	Fiscal Year Ended
	September 30
(In Thousands)	2012			2011
Direct Hire Placement Services
Revenue	$	7,215		$	4,430
Placement services gross margin		100	%		100	%
Operating loss		(1,701	)		(678	)
Depreciation & amortization		237			180
Accounts receivable – net		980			699
Intangible assets		465			584
Goodwill		24			24
Total assets		3,334			5,301
Management Services
Revenue	$	—		$	838
Operating income		—			519
Fee receivable		—			225
Total assets		—			225
Contract Staffing Services
Agricultural services revenue	$	7,852		$	12,412
Industrial services revenue		28,206			12,349
Professional services revenue		9,132			7,160
Agricultural services gross margin		4.41	%		4.6	%
Industrial services gross margin		17.15	%		14.6	%
Professional services gross margin		19.38	%		29.9	%
Operating income (loss)	$	894		$	715
Depreciation and amortization		309			533
Accounts receivable – agricultural services		597			666
Accounts receivable – industrial services		4,056			3,837
Accounts receivable – professional services		1,128			1,177
Intangible assets		1,739			2,115
Goodwill		1,083			1,256
Total assets	$	7,865		$	5,970
Consolidated
Total revenue	$	52,405		$	37,189
Operating income (loss)		(807	)		556
Depreciation and amortization		546			713
Total accounts receivables – net		6,761			6,604
Intangible assets		2,204			2,699
Goodwill		1,106			1,280
Total assets	$	11,199		$	11,496

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Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.

On November 26, 2012, the Company dismissed BDO USA, LLP (“BDO”), its independent registered public accounting firm. The decision was approved by the Company’s Audit Committee.

The reports of BDO on the Company’s financial statements for the fiscal years endedSeptember 30, 2011 and 2010 did not contain an adverse opinion or a disclaimer of opinion and were not qualified or modified as to uncertainty, audit scope, or accounting principles. During the fiscal years ended September 30, 2011 and September 30, 2010, (i) there were no disagreements with BDO on any matter of accounting principles or practices, financial statement disclosure or auditing scope or procedures, which disagreements, if not resolved to the satisfaction of BDO would have caused it to make reference to such disagreement in its reports; and (ii) there were no reportable events as defined in Item 304(a)(1)(v) of Regulation S-K.

In connection with the audit of the Company’s financial statements for the fiscal year ended September 30, 2012 (the “2012 Audit”), on October 12, 2012, BDO notified the Company of its need to expand the scope of the procedures to be performed as part of the 2012 Audit, to ascertain the extent of the Company’s business and financial affiliation with Mr. Wilbur Anthony Huff following the indictment of Mr. Huff for various conspiracies and fraudulent schemes.  On October 18, 2012, BDO set out a work plan for such extended audit procedures (the “Work Plan”), which consisted of two phases.  The first phase of the Work Plan had estimated fees of $150,000, without any limit or guarantee.  BDO could not estimate the fees for phase II of the Work Plan.  Through multiple communications, the Company’s Audit Committee expressed its disagreement to BDO regarding the necessity and scope of the extended audit procedures.  After being unable to agree upon the extent of the 2012 Audit, the Company’s Audit Committee informed BDO, on November 26, 2012, that it was terminating the services of BDO due to (i) the open ended nature of fees which may be imposed by BDO for the two phase Work Plan, (ii) the open ended time frame for the completion of both phases of the Work Plan, and (iii) the uncertainty of BDO’s conclusion following the completion of the Work Plan.

 On November 29, 2012, the Company engaged Friedman, LLP (“Friedman”) as the Company’s new independent registered public accounting firm to audit the Company’s financial statements for the fiscal years ending September 30, 2012 and 2011. The appointment of Friedman was approved by the Company’s Audit Committee.

During each of the Company’s two most recent fiscal years and through the interim period preceding the engagement of Friedman, the Company (a) has not engaged Friedman as either the principal accountant to audit the Company’s financial statements, or as anindependent accountant to audit a significant subsidiary of the Company and on whom the principal accountant is expected to express reliance in its report; and (b) has not consulted with Friedman regarding (i) the application of accounting principles to a specific transaction, either completed or proposed, or the type of audit opinion that might be rendered on the Company’s financial statements, and no written report or oral advice was provided to the Company by Friedman concluding there was an important factor to be considered by the Company in reaching a decision as to an accounting, auditing or financial reporting issue; or (ii) any matter that was either the subject of a disagreement, as that term is defined in Item 304(a)(1)(iv) of Regulation S-K or a reportable event, as that term is described in Item 304(a)(1)(v) of Regulation S-K.

Item 9A. Controls and Procedures.

We carried out an evaluation required by Rule 13a-15 of the Exchange Act under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of Empire Resorts, Inc.’s “disclosure controls and procedures” and “internal control over financial reporting” as of the end of the period covered by this Annual Report.

The evaluation of General Employments Inc.’s disclosure controls and procedures and internal control over financial reporting included a review of our objectives and processes, implementation by us and the effect on the information generated for use in this Annual Report. In the course of this evaluation and in accordance with Section 302 of the Sarbanes Oxley Act of 2002, we sought to identify material weaknesses in our controls, to determine whether we had identified any acts of fraud involving personnel who have a significant role in our internal control over financial reporting that would have a material effect on our consolidated financial statements, and to confirm that any necessary corrective action, including process improvements, were being undertaken. Our evaluation of our disclosure controls and procedures is done quarterly and management reports the effectiveness of our controls and procedures in our periodic reports filed with the Securities and Exchange Commission. Our internal control over financial reporting is also evaluated on an ongoing basis by our internal auditors and by other individuals in our organization. The overall goals of these evaluation activities are to monitor our disclosure controls and procedures and internal control over financial reporting and to make modifications as necessary. We periodically evaluate our processes and procedures and make improvements as required.

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Because of inherent limitations, disclosure controls and procedures and internal control over financial reporting may not prevent or detect misstatements. In addition, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate. Management applies its judgment in assessing the benefits of controls relative to their costs. Because of 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. The design of any system of controls is based in part upon 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, regardless of how remote.

Disclosure Controls and Procedures

Disclosure controls and procedures are designed with the objective of ensuring that (i) information required to be disclosed in our reports filed under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission and (ii) information is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosures. Based on their evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures are effective.

Management’s Report on Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a-15(f). Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that (a) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company; (b) provide reasonable assurance that transactions are recorded as necessary to permit the preparation of financial statements in accordance with generally accepted accounting principles and that receipts and expenditures of the Company are being made only in accordance with authorizations of the our management and directors; and (c) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the financial statements. Based on our evaluation under the framework in Internal Control—Integrated Framework, our management concluded that our internal control over financial reporting was effective as of September 30, 2012.

There were no changes in our internal controls over financial reporting during the fourth quarter of the year ended September 30, 2012 that have materially affected, or are reasonably likely to materially affect, the registrant's internal control over financial reporting.

Item 9B. Other Information.

Not applicable.

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PART III

Item 10, Directors, Executive Officers and Corporate Governance.

DIRECTORS AND EXECUTIVE OFFICERS

Executive Officers

The named executive officers and directors of the Company as of March 29, 2013 are as follows:

Name	Age	Position
Michael K. Schroering	55	Chief Executive Officer, Chairman of the Board
Brad A. Imhoff	50	Chief Operating Officer, President of the Professional Staffing Division
Andrew J. Norstrud	39	Chief Financial Officer, Treasurer
Katy M. Imhoff	29	Vice President of Operations, Vice President of the Professional Staffing Division
Edward Hunter	66	Director
Thomas C.  Williams	53	Director
Dennis W. Baker	66	Director

Michael K, Schroering – Chief Executive Officer, Chairman of the Board

Mr. Schroering joined General Employment Enterprises as a director in November 2012 and become the Chairman of the Board and Chief Executive Officer in December 2012. Prior to joining the Company, he served as President of The Schroering Company which he founded in 1993. The Schroering Company is a Louisville-based commercial real estate firm specializing in consulting services, site procurement, owner and tenant representation for the sale/leasing of office and industrial space. Other companies under his leadership have been active in real estate development through GlobalPort United, LLC which owns interest in several million square feet of big box warehouse space. Mr. Schroering received a B.A. in Business Administration in Finance and Management from Loyola University (1979) and went to the University of Louisville School of law (1979 – 1981).

Brad A. Imhoff – Chief Operating Officer, President of the Professional Staffing Division

Mr. Imhoff has served as Chief Operating Officer and President of the Professional Staffing Division since September 1, 2011. Prior to joining the Company, Mr. Imhoff, co-founded Ashley Ellis, LLC (“Ashley Ellis”) a company that provided services related to the recruitment and placement of technical personnel, in January 2009 and served as its Chief Executive Officer and sole member from January 2009 until August 31, 2011, at which time substantially all of the assets of Ashley Ellis were acquired by the Company. Prior to founding Ashley Ellis, Mr. Imhoff worked as a sales consultant and participated in sales training seminars from January 2005 to January 2009. Prior to that, Mr. Imhoff managed and co-owned Camden Aviation LLC, a private jet charter company, from January 2000 to January 2005 and, co-founded and served as Chief Executive Officer of Camden Vale Corporation, an information technology recruiting firm, from January 1995 to October 2001. Mr. Imhoff previously served as Vice President of Staffing of the Company from October 1985 to January 1995.

Andrew J. Norstrud – Chief Financial Officer, Treasurer

Mr. Norstrud joined General Employment Enterprises in March 2013.  Prior to joining the Company, Mr. Norstrud was a consultant with Norco Accounting and Consulting from October 2011 until March 2013.  From October 2005 to October 2011, Mr. Norstrud served as the Chief Financial Officer for Jagged Peak.  Prior to his role at Jagged Peak, Mr. Norstrud was the Chief Financial Officer of Segmentz, Inc., and played an instrumental role in the company achieving its strategic goals by pursuing and attaining growth initiatives, building an exceptional financial team, completing and integrating strategic acquisitions and implementing the structure required of public companies.  Previously, Mr. Norstrud worked for Grant Thornton LLP and PricewaterhouseCoopers LLP and has extensive experience with young, rapid growth public companies.  Mr. Norstrud earned a BA in Business and Accounting from Western State College and a Master of Accounting with a systems emphasis from the University of Florida.  He is a Florida licensed Certified Public Accountant.

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Katy Imhoff – Vice President of Operations, Vice President of Professional Division

Ms. Imhoff has served as Vice President of Operations and Vice President of the Professional Staffing Division since September 1, 2011. Prior to joining the Company, Ms. Imhoff co-founded Ashley Ellis in January 2009, a company that provided services related to the recruitment and placement of technical personnel, and served as its Chief Operations Officer and Vice President until August 31, 2011, when Ashley Ellis become a wholly owned subsidiary of the Company. Prior to founding Ashley Ellis, Ms. Imhoff served as a consultant from 2006 to December1 2008 for the Company and, previously, for Austin Vale, an India-based recruitment firm for technical personnel. In this position, Ms. Gallagher consulted on strategic planning, marketing and training. Prior to that, Ms. Gallagher was the sole owner of Ashton Zane Inc, a provider of sales training seminars across the country, from 2004 to 2006.

Edward Hunter – Director

Mr. Hunter joined the Company in October 2012 as a Director.  Mr. Hunter has practiced as an international business lawyer and litigator for more than 35 years, in both private practice and as in-house counsel. Most recently, he practiced with the business-focused firm of Robinson & Robinson, LLP, from 2002 to 2010, and since then with his own law office in Laguna Hills, California. Within the past five years, he served as a director of En Pointe Technologies, Inc. (formerly NASDAQ-CM: (now privately held)) (2003-2009) and of International Stem Cell Corporation (OTC: ISCO) (2007-2009), where he also served as Chairman of the respective Compensation Committees and as a member of their Audit Committees. From 2006 to 2009, he served on the board of Ovex Technologies (Pvt.) Ltd. of Lahore, Pakistan, chaired its Compensation Committee, and served on its Audit Committee. He previously served on the registrant’s Board of Directors from February 2009 to July 2009. He has been designated a “financial expert” within the meaning of the Sarbanes-Oxley Act of 2002 (“SOX”) and has experience implementing internal control and other procedures to comply with SOX requirements.  In addition to legal training and experience as an attorney, Mr. Hunter has completed the Corporate Directors Certification Program at the UCLA Anderson Graduate School of Management and the certification procedures of the National Association of Corporate Directors. As chair of three previous Compensation Committees, he led each company’s compliance with Regulation S-K (nonfinancial disclosures) and the evolving new rules and standards for executive compensation.

Thomas C. Williams – Director

Mr. Williams has served as a director of the Company since July 2009. Since 2005, Mr. Williams has served as acting Vice Chairman of Capital Management of Bermuda (previously Travelers of Bermuda), a company providing pension benefits for expatriates who have worked outside the U.S. and accrued benefits towards their retirement which are not covered by their domestic pension plans. Mr. Williams served as the Chief Executive Officer of Innova Insurance Ltd., a Bermuda based insurer, which provides extension risk to the Capital Markets on life insurance related assets from 2005 to 2009 when it was acquired.  Mr. Williams is Chairman of the Nominating Committee and is a member of the Audit and Compensation Committees. The Company believes that Mr. Williams is qualified to sit on the board of directors because of his significant management experience.

Dennis W. Baker – Director

Mr. Baker has served as a director of the Company since 2000. From April 1975 to April 2006, Mr. Baker held various positions with CF Industries Holdings, Inc., a fertilizer manufacturing and distribution company, and most recently served as Treasurer from March 1988 to April 2007, when he retired. During this time, he also held the following titles at CF Industries Holdings, Inc.: Assistant Treasurer, Director of Financial Planning and Budgeting, Manager of Financial Planning, Manager of Budgets and Capital Expenditure Control, Capital Expenditure Control Analyst and Financial Analyst. On May 1, 2011 Mr. Baker was elected to the Board of Directors of CIS World, Inc. Mr. Baker is Chairman of the Audit Committee and is a member of the Compensation and Nominating Committees. The Company believes that Mr. Baker is qualified to sit on the board of directors because of his extensive management experience.

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All executive officers are elected annually by the Board of Directors at the first meeting of the board held following each Annual Meeting of Shareholders, and they hold office until their successors are elected and qualified.

Brad A. Imhoff is married to Katy Imhoff, the Vice President of operations for the Company.  Brad A. Imhoff is the brother of Herbert F. Imhoff Jr., our former President and former director.  Herbert Imhoff, Jr. retired from all positions within the Company effective January 31, 2013.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), requires the Company’s directors and officers, and persons who own more than 10% of a registered class of its equity securities, to file reports of ownership and changes in ownership (typically, Forms 3, 4 and/or 5) of such equity securities with the SEC. Such entities are also required by SEC regulations to furnish the Company with copies of all such Section 16(a) reports.

Based solely on a review of Forms 3 and 4 and amendments thereto furnished to the Company and written representations that no Form 5 or amendments thereto were required, the Company believes that during the fiscal year ended September 30, 2012 and 2011, its directors and officers, and greater than 10% beneficial owners, have complied with all Section 16(a) filing, except as follows:

· Michael Schroering was late in filing his initial Form 3 dated September 21, 2012 reflecting the acquisition of 199,334 shares directly and 15,842,410 shares indirectly through LEED HR, LLC on August 16, 2012.

· LEED HR, LLC was late in filing its initial Form 3 dated September 14, 2012 reflecting the acquisition of 15,842,410 shares on August 16, 2012.

Board Leadership Structure and Role in Risk Oversight

The Board of Directors believes that the Company’s Chief Executive Officer is best situated to serve as Chairman because he is the director most familiar with the Company’s business and industry, and most capable of effectively identifying strategic priorities and leading the discussion and execution of strategy. Independent directors and management have different perspectives and roles in strategy development. The Company’s independent directors bring experience, oversight and expertise from outside the company and industry, while the Chief Executive Officer brings company-specific experience and expertise. The Board of Directors believes that the combined role of Chairman and Chief Executive Officer is in the best interest of shareholders because it promotes strategy development and execution, and facilitates information flow between management and the Board of Directors, which are essential to effective governance. The Board of Directors does not have a lead independent director.

The Board of Directors provides overall risk oversight for the Company as part of its normal, ongoing responsibilities. It receives reports from Mr. Schroering and other members of senior management on a periodic basis on areas of risk facing the Company. In addition, board committees oversee specific elements of risk or potential risk.

Director Independence

The Board of Directors has determined that each director, other than Mr. Schroering, is an independent director under the listing standards of the NYSE MKT. In addition, the Board of Directors has determined that each current member of the Audit Committee meets the additional independence criteria required for audit committee membership under the listing standards of the NYSE MKT and Rule 10A-3 of the Exchange Act.

Board and Committee Meetings

The Board of Directors meets on a regularly scheduled basis to review significant developments affecting the Company and to act on matters requiring Board approval. It also holds special meetings when an important matter requires Board action between scheduled meetings. The Board of Directors held eight meetings during the last fiscal year. No director of the Company attended less than 75% of the total meetings of the Board and Committees on which such Board members served during this period.

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There are three standing committees of the Board of Directors, which are the Nominating Committee, the Audit Committee and the Compensation Committee.

Nominating Committee

The functions of the Nominating Committee are to assist the Board of Directors in identifying, interviewing and recommending to the Board of Directors qualified candidates to fill positions on the board.  The Nominating Committee met two times during 2012.

The Company does not have a policy regarding the consideration of diversity, however defined, in identifying nominees for director. Instead, in evaluating candidates to serve on the Company’s Board of Directors, consideration is given to the level of experience, financial literacy and business acumen of the candidate. In addition, qualified candidates for director are those who, in the judgment of the Nominating Committee, have significant decision-making responsibility, with business, legal or academic experience. The Nominating Committee will consider recommendations for board candidates that are received from various sources, including directors and officers of the Company, other business associates and shareholders, and all candidates will be considered on an equal basis, regardless of source.

Shareholders may contact the Nominating Committee to make such recommendations by writing in care of the Secretary of the Company, at One Tower Lane, Suite 2200, Oakbrook Terrace, Illinois 60181. Submissions must be in accordance with the Company’s By-Laws and include: (a) a statement that the writer is a shareholder and is proposing a candidate for consideration by the Nominating Committee; (b) the name, address and number of shares beneficially owned by the shareholder; (c) the name, address and contact information of the candidate being recommended; (d) a description of the qualifications and business experience of the candidate; (e) a statement detailing any relationships between the candidate and the Company and any relationships or understandings between the candidate and the proposing shareholder; and (f) the written consent of the candidate that the candidate is willing to serve as a director if nominated and elected.

The Nominating Committee is presently composed of three non-employee directors: Thomas C. Williams (Chairman), Dennis W. Baker, and Edward Hunter.

The Board of Directors has adopted a written charter for the Nominating Committee. The Nominating Committee Charter is not available on the Company’s website. A copy of the Nominating Committee Charter was attached as an appendix to the proxy statement prepared in connection with the February 10, 2011 Annual Meeting of Shareholders.

Audit Committee

The Audit Committee is primarily concerned with the effectiveness of the Company’s accounting policies and practices, its financial reporting and its internal accounting controls. In addition, the Audit Committee reviews and approves the scope of the annual audit of the Company’s books, reviews the findings and recommendations of the independent registered public accounting firm at the completion of their audit, and approves annual audit fees and the selection of an auditing firm. The Audit Committee met four times during fiscal 2012.

The Audit Committee is presently composed of three non-employee directors: Dennis W. Baker (Chairman), Edward Hunter and Thomas C. Williams. The Board of Directors has determined that Mr. Baker, Mr. Hunter and Mr. Williams are all considered an “audit committee financial expert” as defined by rules of the SEC.  The Board of Directors has determined that each audit committee financial expert meets the additional independence criteria required under the listing standards of the NYSE MKT and Rule 10A-3 of the Exchange Act.

The Board of Directors has adopted a written charter for the Audit Committee. The Audit Committee Charter is not available on the Company’s website. A copy of the Audit Committee Charter is attached as appendix A to the proxy filed with the SEC on January 27, 2012.

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Compensation Committee

The Compensation Committee has the sole responsibility for approving and evaluating the officer compensation plans, policies and programs. It may not delegate this authority. It meets as often as necessary to carry out its responsibilities. The Compensation Committee has the authority to retain compensation consultants, but has not done so. The Compensation Committee met three times during fiscal 2012.

In the past, the Compensation Committee has met each September to consider the compensation of the Company’s executive officers, including the establishment of base salaries and performance targets for the succeeding year, and the consideration of stock option awards. Management provides the Compensation Committee with such information as may be requested by the Compensation Committee, which in the past has included historical compensation information of the executive officers, tally sheets, internal pay equity statistics, and market survey data. Under the guidelines of the NYSE MKT, the chief executive officer may not be present during the Compensation Committee’s deliberations regarding his compensation. If requested by the committee, the chief executive officer may provide recommendations regarding the compensation of the other officers.

The Compensation Committee also has the responsibility to make recommendations to the Board of Directors regarding the compensation of directors.

The Compensation Committee is presently composed of three non-employee directors: Edward Hunter (Chairman), Dennis W. Baker, and Thomas C. Williams.

The Board of Directors has adopted a written charter for the Compensation Committee. The Compensation Committee Charter is not available on the Company’s website. A copy the Compensation Committee Charter was attached as an appendix to the proxy statement prepared in connection with the March 22, 2010 Annual Meeting of Shareholders.

Shareholder Communications

The Board of Directors has established a procedure by which shareholders of the Company can communicate with the Board of Directors. Shareholders interested in communicating with the Board of Directors as a group or with individual directors may do so, in writing. Correspondence to the directors should be sent by regular mail c/o the Secretary, General Employment Enterprises, Inc., One Tower Lane, Suite 2200, Oakbrook Terrace, Illinois 60181. Any such correspondence will be reviewed by the Secretary, who will then forward it to the appropriate parties. Communications that are solicitations or deemed to be irrelevant to the Board of Directors’ responsibilities may be discarded, at the discretion of the Secretary.

The Company has a code of ethics that applies to all of its directors and employees, including its principal executive officer, principal financial officer and principal accounting officer.  The code of ethics is filed as an exhibit to this Annual Report.

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Item 11, Executive Compensation.

EXECUTIVE COMPENSATION

Summary Compensation Information

The following table summarizes all compensation awarded to, earned by or paid to all individuals serving as the Company’s principal executive officer, its two most highly compensated executive officers other than the principal executive officer, and up to two additional individuals who were serving as executive officers at the end of the last completed fiscal year, for each of the last two completed fiscal years. These individuals are referred to throughout this proxy statement as the “named executive officers.”

Summary Compensation Table

Name and Principal Position	Fiscal Year	Salary ($)	Bonus ($)	Stock Awards ($)	Option Awards ($)		NonEquity Incentive Plan Compensation ($)	Nonqualified Deferred Compensation Earnings ($)	All Other Compensation ($)		Total ($)
Salvatore J. Zizza	2012	120,000		––	76,500	(1)			––		196,500
former Chief Executive Officer and Chairman of the Board(2)	2011	97,667		––	––				––		97,667
Herbert F. Imhoff, Jr.(3)	2012	––		––	76,500	(1)			180,000		256,500
former President	2011	––		––	––				180,000		180,000
Brad Imhoff(4)	2012	180,000		––	––				2,500		182,500
Chief Operating Officer and President, Professional Staffing Division	2011	15,000		––	––				2,500		17,500
Katy Imhoff(5)	2012	150,000		––	––				––		150,000
Vice President, Professional Staffing Division	2011	12,500		––	––				––		12,500
Marilyn L. White(6)	2012	––		––	––				––		––
former Vice President	2011	137,500		––	––				32,500	(7)	170,000
Jarett Misch(8)	2012	108,200		––	––				9,500		117,700
former Chief Financial Officer and Treasurer	2011	––		––	––				––		––
James R. Harlan(9) former Chief Financial Officer and Treasurer	2011	119,167		––	––				––		119,167

(1) Includes an option to purchase 300,000 shares of common stock at a price of $0.41 per share, granted on February 22, 2012.  Due to a change of control, subsequent to year end, all of such options were immediately vested and exercisable.   In connection with Mr. Zizza’s retirement, the Board agreed to extend the period during which Mr. Zizza can exercise his stock options that are vested from one year to eighteen months from the date of his retirement on December 26, 2012.

(2) As of December 26, 2012, Mr. Zizza retired from all positions with the Company.

(3) As of August 31, 2011, Herbert F. Imhoff, Jr. no longer served as Chief Operating Officer of the Company.  Effective January 31, 2013, Mr. Herbert Imhoff, Jr. retired from all positions with the Company.

(4) On August 31, 2011, Mr. Brad Imhoff was appointed Chief Operating Officer and President of the Professional Staffing Division.

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(5) On August 31, 2011, Ms. Imhoff was appointed Vice President, Professional Staffing Division

(6) On August 31, 2011, Marilyn L. White was terminated from her position as Vice President of the Company.

(7) Amount represents severance payment made to Ms. White

(8) On December 30, 2011, James Harlan was terminated from his position as Chief Financial Officer and Treasurer.

(9)  Mr. Misch was appointed Chief Financial Officer and Treasurer of the Company effective January 3, 2012.  On February 22, 2013, Mr. Misch resigned from all positions with the Company.

Employment and Change in Control Agreements

Salvatore J. Zizza: On September 7, 2011, the Company and Salvatore J. Zizza, the Company’s Chairman and Chief Executive Officer, entered into an employment agreement (the “Zizza Employment Agreement”) and a change of control agreement (the “Zizza Change of Control Agreement”), each dated as of September 1, 2011. The Zizza Employment Agreement provides for a two-year term ending on September 1, 2013, unless Mr. Zizza’s employment is earlier terminated by either party in accordance with the provisions thereof. Mr. Zizza is to receive a base salary at the rate of $120,000 per year, subject to increase in the discretion of the Board of Directors of the Company. Mr. Zizza will also receive a life insurance policy with coverage equal to two times his base salary and a disability income insurance policy with coverage equal to 50% of his base salary. Mr. Zizza will be entitled to receive equity compensation on the same terms and conditions as other executives and members of the Board of Directors of the Company. In the event that Mr. Zizza’s employment is terminated (other than as a result of Mr. Zizza’s death or disability) either (i) by the Company for a reason other than Cause or (ii) by Mr. Zizza for Good Reason (each as defined in the Zizza Employment Agreement), Mr. Zizza will continue to receive his base salary and other benefits provided under the Zizza Employment Agreement for the remainder of the term of the Zizza Employment Agreement.

The term of the Zizza Change of Control Agreement commenced on September 1, 2011 and will terminate on the earlier of (i) two years following the date of execution; (ii) termination of Mr. Zizza’s employment; or (iii) the execution of a written agreement between the Company and Mr. Zizza terminating the Zizza Change of Control Agreement. Under the Zizza Change of Control Agreement, in the event that the Company terminates Mr. Zizza’s employment without Cause or Mr. Zizza resigns with Good Reason after a Change of Control (each as defined in the Zizza Change of Control Agreement), Mr. Zizza will receive, subject to his execution of a separation agreement and release of claims in a form reasonably satisfactory to the Company, (i) a lump sum payment equal to all unpaid compensation remaining from the day of separation to the end of the term of the Zizza Employment Agreement; (ii) continuation of health insurance benefits for six months following his separation from service; (iii) reimbursement for the premiums associated with COBRA for 18 months following the six-month continuation of health insurance period; and (iv) the same percentage of Company-paid group-term life insurance benefits as were provided to Mr. Zizza and his family under plans of the Company as of the Change of Control for a total of twenty-four months following the year in which Mr. Zizza separates from service.

On December 26, 2012, Mr. Zizza informed the Board that he was retiring from all positions with the Company, effective immediately.  Under the terms of the Zizza Employment Agreement, Mr. Zizza will continue to receive his base salary of $10,000 per month through August 31, 2013.  Additionally, the Board agreed to extend the period during which Mr. Zizza can exercise his stock options that are vested and outstanding as of December 26, 2012 from one year to eighteen months from the date of his retirement.  As of December 26, 2012, Mr. Zizza had options to purchase 300,000 shares of the Company’s common stock vested and outstanding.

Brad A. Imhoff: In connection with Brad A. Imhoff’s appointment as Chief Operating Officer of the Company, the Company entered into an employment agreement (the “Imhoff Employment Agreement”) and a change of control agreement (the “Imhoff Change of Control Agreement”) with Mr. Imhoff, each dated as of August 31, 2011. The Imhoff Employment Agreement provides for a three-year term ending on September 1, 2014, unless Mr. Imhoff’s employment is earlier terminated in accordance with the provisions thereof. Mr. Imhoff is to receive a base salary at the rate of $180,000 per year for the term of the Imhoff Employment Agreement. Mr. Imhoff is also entitled to receive an annual bonus equal to 10% of the increase in profits earned by the Company’s Professional Staffing Division over the prior fiscal year minus an agreed upon corporate allocation and not including any profits of acquired entities or assets until the applicable earnout periods related thereto have expired. The fiscal year ending September 30, 2011 will be used as the first baseline to determine the profitability bonus and will be used in subsequent years to determine the profitability bonus to the extent that profits in subsequent years are less than profits for the fiscal year ending September 30, 2011. Upon the expiration of the term of the Imhoff Employment Agreement or termination of Mr. Imhoff’s employment by the Company with cause under the circumstances set forth in the Imhoff Employment Agreement, the Company’s obligations are limited generally to paying Mr. Imhoff his base salary through the termination date.

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The term of the Imhoff Change of Control Agreement commenced on August 31, 2011 and will terminate on the earlier of (i) three years following the date of execution; (ii) termination of Mr. Imhoff’s employment; or (iii) the execution of a written agreement between the Company and Mr. Imhoff terminating the Imhoff Change of Control Agreement. Under the Imhoff Change of Control Agreement, in the event that the Company terminates Mr. Imhoff’s employment without Cause or Mr. Imhoff resigns with Good Reason after a Change of Control (each as defined in the Imhoff Change of Control Agreement), Mr. Imhoff will receive, subject to his execution of a separation agreement and release of claims in a form reasonably satisfactory to the Company, (i) a lump sum payment equal to all unpaid compensation remaining from the day of separation to the end of the term of the Imhoff Employment Agreement; (ii) continuation of health insurance benefits for six months following his separation from service; (iii) reimbursement for the premiums associated with COBRA for 18 months following the six-month continuation of health insurance period; and (iv) the same percentage of Company-paid group-term life insurance benefits as were provided to Mr. Imhoff and his family under plans of the Company as of the Change of Control for a total of twenty-four months following the year in which Mr. Imhoff separates from service.

Katy M. Imhoff: On August 31, 2011, the Company and Katy Gallagher, Vice President Operations, entered into an employment agreement (the “Katy Imhoff Employment Agreement”) and a change of control agreement (the “Katy Imhoff Change of Control Agreement”). Ms. Imhoff will serve as the Vice President of Operations and the Vice President of the Professional Staffing Division of the Company. The Katy Imhoff Employment Agreement provides for a three-year term ending on September 1, 2014, unless Ms. Imhoff’s employment is earlier terminated in accordance with the provisions thereof. Ms. Imhoff is to receive a base salary at the rate of $150,000 per year for the term of the Katy Imhoff Employment Agreement. Upon the Death, Disability, expiration of the term of the Katy Imhoff Employment Agreement, or a termination of Ms. Imhoff’s employment with Cause (each as defined in the Katy Imhoff Employment Agreement), the Company’s obligations are limited generally to paying Ms. Imhoff her base salary through the termination date.

The term of the Katy Imhoff Change of Control Agreement commenced on August 31, 2011 and will terminate on the earlier of (i) three years following the date of execution; (ii) termination of Ms. Imhoff’s employment; or (iii) the execution of a written agreement between the Company and Ms. Imhoff terminating the Katy Imhoff Change of Control Agreement. Under the Katy Imhoff Change of Control Agreement, in the event that the Company terminates Ms. Imhoff’s employment without Cause or Ms. Imhoff resigns with Good Reason after a Change of Control (each as defined in the Katy Imhoff Change of Control Agreement), Ms. Imhoff will receive, subject to her execution of a separation agreement and release of claims in a form reasonably satisfactory to the Company, (i) a lump sum payment equal to all unpaid compensation remaining from the day of separation to the end of the term of the Katy Imhoff Employment Agreement; (ii) continuation of health insurance benefits for six months following her separation from service; (iii) reimbursement for the premiums associated with COBRA for 18 months following the six-month continuation of health insurance period; and (iv) the same percentage of Company-paid group-term life insurance benefits as were provided to Ms. Imhoff and her family under plans of the Company as of the Change of Control for a total of twenty-four months following the year in which Ms. Imhoff separates from service.

Consulting Agreement

In connection with the completion of the sale of shares of Common Stock to PSQ on July 1, 2009, Mr. Imhoff, Jr. resigned from his positions as Chairman of the Board and Chief Executive Officer of the Company and his employment agreement with the Company was replaced by a new consulting agreement. Under the consulting agreement, dated as of June 22, 2009, the Company became obligated to pay an annual consulting fee of $180,000 over a five-year period and to issue 500,000 shares of Common Stock to Mr. Imhoff, Jr. in exchange for his service to the Company.  On January 31, 2013, Mr. Herbert Imhoff informed the Board that he was retiring from all positions with the Company, effectively immediately.   Mr. Imhoff Jr. will continue to receive monthly payments of $15,000 through June 30, 2014 as well as medical benefits provided by the Company.  Additionally, under the terms of his stock option agreements, he will have one year to exercise his stock options that are vested and outstanding as of January 31, 2013.  As of January 31, 2013, Mr. Imhoff, Jr, had options to purchase 315,000 shares of the Company’s common stock vested and outstanding.

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Option Awards

The option awards column represents the fair value of the stock options as measured on the grant date. The methods and assumptions used to determine the fair value of stock options granted are disclosed in “Note 15 - Stock Option Plans” in the notes to consolidated financial statements contained elsewhere herein.

All stock options awarded to the named executive officers during fiscal 2012 were at option prices that were equal to the market price on the date of grant, had vesting dates two years or less after the date of grant, and had expiration dates ten years after the date of grant.  Due to a change of control, subsequent to year end, all of such options were immediately vested and exercisable.  There were no stock options awarded in fiscal 2011.

All Other Compensation

Name	Year	Executive Retirement Plan ($)		Consulting Fees ($)		Other ($)			Total All Other Compensation ($)
Salvatore J. Zizza	2012		––		––		76,500	(1)		76,500
former Chief Executive Officer and Chairman of the Board	2011		––		––		––			––
Herbert F. Imhoff, Jr.	2012		––		180,000		76,500	(1)		256,500
former President	2011		––		180,000		––			180,000
Marilyn L. White	2012		––		––		––			––
former Vice President	2011		––		––		32,500	(2)		32,500

(1) Includes an option to purchase 300,000 shares of common stock at a price of $0.41 per share, granted on February 22, 2012. Due to a change of control, subsequent to year end, all of such options were immediately vested and exercisable.  In connection with Mr. Zizza’s retirement, the Board agreed to extend the period during which Mr. Zizza can exercise his stock options that are vested from one year to eighteen months from the date of his retirement on December 26, 2012.

(2) Amount represents severance payment made to Ms. White.

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Outstanding Equity Awards at Fiscal Year-End

OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END

The following table summarizes equity awards granted to Named Executive Officers and Directors that were outstanding as of September 30, 2012:

	Option Awards							Stock Awards
N	Number of Securities Underlying Unexercised Options: # Exercisable		Number of Securities Underlying Unexercised Options: # Unexercisable	Equity Incentive Plan Awards: Number of Securities Underlying Unearned and Unexercisable Options:	Option Exercise Price $		Option Expiration Date	# of Shares or Units of Stock That Have Not Vested #	Market Value of Shares or Units of Stock That Have Not Vested $	Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested #	Equity Incentive Plan Awards: Market of Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested $
Salvatore J. Zizza former Chairman of the Board of Directors, Chief Executive Officer	300,000	(2)	0	0		0.41	6/25/14	0	0	0	0
Herbert F. Imhoff, Jr. President	300,000	(2)	0	0		0.41	1/30/14	0	0	0	0
Dennis Baker, Director	300,000	(2)	0	0		0.41	2/22/17	0	0	0	0
	15,000		0	0		2.39	2/25/17	0	0	0	0
	15,000	(1)	0	0		0.73	2/22/19	0	0	0	0
Charles W. B. Wardell III, Director	300,000	(2)	0	0		0.41	10/4/13	0	0	0	0
(3)	15,000	(1)	0	0		0.73	9/4/13	0	0	0	0
Thomas C. Williams, Director	300,000	(2)	0	0		0.41	2/22/17	0	0	0	0
(2)	15,000	(1)	0	0		0.73	2/22/19	0	0	0	0

(1) The options vest at the rate of 3,000 every year beginning on September 30, 2012. Due to a change of control, subsequent to year end, all of such options were immediately vested and exercisable.

(2) Includes an option to purchase 300,000 shares of common stock at a price of $0.41 per share, granted on February 22, 2012.  Due to a change of control, subsequent to year end, all of such options were immediately vested and exercisable.

(3) Charles W. B. Wardell resigned as of September 4, 2012

Retirement Benefits

The Company does not maintain a tax-qualified defined benefit retirement plan for any of its executive officers or employees. The Company has a 401(k) retirement plan in which all full-time employees may participate after one year of service.

Potential Payments upon Termination of Employment or Change in Control

We have entered into certain agreements (such as the employment agreements discussed above under the caption “Employment and Change in Control Agreements”) and maintain certain plans that require us to provide compensation to the named executive officers in the event of certain terminations of their employment or if the Company experiences a change in control. The amount of compensation that would be payable at September 30, 2012 to each named executive officer for such terminations is shown in the tables below.

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Brad A. Imhoff:

Executive Benefits and Payments Upon Termination	Voluntary Termination		Involuntary Not for Cause Termination		Death or Disability		For Cause Termination		Change in Control		Good Reason
Compensation:
Base Salary Continuance	$	––	$	345,000	$	––	$	––	$	345,000	$	345,000
Vacation Pay		––		31,000		––		––		31,000		31,000
Benefits and Perquisites:
Life Insurance		––		656		––		––		656		656
Disability Insurance		––		1,158		––		––		1,158		1,158
Medical Dental Vision		––		11,287		––		––		11,287		11,287
Total	$	––	$	389,101	$	––	$	––	$	389,101	$	389,101

Katy M. Imhoff:

Executive Benefits and Payments Upon Termination	Voluntary Termination		Involuntary Not for Cause Termination		Death or Disability		For Cause Termination		Change in Control		Good Reason
Compensation:
Base Salary Continuance	$	––	$	287,500	$	––	$	––	$	287,500	$	287,500
Vacation Pay		––		25,862		––		––		25,862		25,862
Benefits and Perquisites:
Life Insurance		––		656		––		––		656		656
Disability Insurance		––		965		––		––		965		965
Medical Dental Vision		––		11,297		––		––		11,297		11,297
Total	$	––	$	326,280	$	––	$	––	$	326,280	$	326,280

DIRECTOR COMPENSATION

Compensation of Directors

Under the Company’s standard compensation arrangements that were in effect during fiscal 2011, each non-employee director received a monthly retainer of $2,000 with the exception of Mr. Baker who received $2,500 per month from March 2011 forward. Directors did not receive any additional compensation for attendance at meetings of the Board of Directors or its committees. Employees of the Company did not receive any additional compensation for service on the Board of Directors.

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The following table sets forth information concerning the compensation paid to each of the directors during fiscal 2012:

Director Compensation

Name	Fees Earned or Paid in Cash ($)		Option Awards (1) ($)		Total ($)
Dennis W. Baker		30,000		76,500		106,500
Herbert F. Imhoff, Jr.		24,000		(2)		24,000
Charles W. B. Wardell III		24,000		76,500		100,500
Thomas C. Williams		24,000		76,500		100,500

(1) The aggregate number of outstanding option awards at the end of fiscal 2012 were as follows for each of the non-employee directors: Mr. Baker – 330,000; Mr. Imhoff, Jr. – 315,000; Mr. Wardell – 315,000; Mr. Williams – 315,000.  Due to a change of control, subsequent to year end, all of such options were immediately vested and exercisable.

(2) Options granted were included in compensation above as Herbert F. Imhoff, Jr. was also an employee. Herbert F. Imhoff, Jr. has since retired from all positions for the Company.

Option Awards

The option awards column represents the fair value of the stock options as measured on the grant date. The methods and assumptions used to determine the fair value of stock options granted are disclosed in “Note 16 - Stock Option Plans” in the notes to consolidated financial statements in the Company’s Annual Report for fiscal 2012 accompanying this proxy statement.

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Item 12, Security Ownership of Certain Beneficial Owners and Management.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

Listed in the following table is information concerning persons known to the Company to be beneficial owners of more than five percent of the Company’s outstanding Common Stock, and information concerning the beneficial ownership of the Company’s outstanding Common Stock by each director, director nominee and named executive officer, as defined below, individually, and by all current directors and executive officers as a group. Unless noted otherwise, the named persons have sole voting and dispositive power over the shares listed. Except as noted otherwise, the information is as of March 28, 2013.

Name and Address of Beneficial Owner	Amount and Nature of Beneficial Ownership			Percent of Class(1)
LEED HR, LLC and Michael Schroering(2) LEED HR, LLC 2650 East Point Parkway, Suite 280 Louisville, KY 40223		16,041,744	(2)		73.9%
Dennis W. Baker.		373,800	(3)		1.7%
Thomas C. Williams		306,000	(4)		1.4%
Brad A. Imhoff		1,252,300	(5)		5.8%
Katy M. Imhoff		1,252,300	(6)		5.8%
Andrew J. Norstrud(7)		––			––
Edward Hunter(8)		––			––
Current directors and executive officers as a group (6 individuals)		17,973,844			82.8%

* Represents less than 1%.

(1)           Based on 21,699,675 shares issued and outstanding as of March 28, 2013.

(2)           Based on the Schedule 13D filed on September 13, 2013 and the Schedule 13D/A filed on September 21, 2012 by each of LEED HR, LLC a Kentucky limited liability company, and Mr. Schroering, which disclosed that LEED HR, LLC owns directly 15,824,410 shares of Common Stock.  Mr. Schroering owns directly 199,334 shares of Common Stock.  Mr. Schroering is the sole manager of LEED HR, LLC.  By virtue of this relationship, Mr. Schroering may be deemed to beneficially own, the  15,824,410 shares of Common Stock owned directly by LEED HR, LLC. 

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(3)           Represents (i) 52,800 shares of Common Stock owned, (and (ii) 321,000 shares issuable upon the exercise of stock options that are currently exercisable.  

(4)           Represents 306,000 shares issuable upon the exercise of stock options that are currently exercisable.

(5)           Represents (i) 1,250,000 shares of Common Stock held directly by Ashley Ellis LLC, of which Mr. Imhoff is the sole member and Chief Executive Officer , (ii) 1,150 shares of Common Stock directly owned and (iii) 1,150 shares of Common Stock owned by Mr. Imhoff’s daughter, Lisa Imhoff.

(6)           Ms. Imhoff is married to Mr. Brad Imhoff and may be deemed to own the shares beneficially owned by him.   Ms. Imhoff disclaims beneficial ownership of such shares except to the extent of her pecuniary interest therein.

(7)           Mr. Norstrud joined the Company effective March 28, 2013.

(8)           Mr. Hunter joined the Company effective October 2, 2012.

Item 13, Certain Relationships and Related Transactions, and Director Independence.

Transactions with Related Persons, Promoters and Certain Control Persons

On August 31, 2011, the Company entered into an asset purchase agreement (the “Ashley Purchase Agreement”) with Ashley Ellis, an Illinois limited liability company, and Brad A. Imhoff for the purchase of certain assets of Ashley Ellis, including customer lists, comprising Ashley Ellis’ services business. Ashley Ellis’ services business was operated from offices in Illinois, Texas and Georgia and provided services related to the recruitment and placement of technical personnel. The Ashley Purchase Agreement was deemed effective on September 1, 2011.

Brad A. Imhoff is the brother of Herbert F. Imhoff, Jr., a former director and the former President of the Company.  Effective January 31, 2013, Herbert Imhoff, Jr. retired from all positions with the Company. Brad A. Imhoff and Ashley Ellis, an entity of which Brad A. Imhoff is the sole member and Chief Executive Officer, were parties to the transaction. As consideration for the assets, the Company paid Ashley Ellis $200,000 on the date of closing and paid Ashley Ellis an additional $200,000 within six months of closing. The Company also issued to Ashley Ellis 1,250,000 restricted shares of the Company’s common stock. As the sole member of Ashley Ellis, Brad A. Imhoff has an interest in the entire consideration paid by the Company to Ashley Ellis for the assets.

In connection with the transactions contemplated by the Ashley Purchase Agreement, on August 31, 2011, the Company and Ashley Ellis entered into a registration rights agreement (the “Registration Rights Agreement”), pursuant to which Ashley Ellis was granted certain piggyback registration rights with respect to the shares to be issued to Ashley Ellis under the Ashley Purchase Agreement. The Registration Rights Agreement contains certain indemnification provisions for the benefit of the Company and Ashley Ellis and other customary provisions.

In conjunction with the acquisition of DMCC and RFFG of Cleveland in December 2011, BMP, an Ohio corporation and a wholly-owned subsidiary of the Company, entered into a management service agreement (the “Management Agreement”) with RFFG effective November 1, 2010.   Thomas J. Bean, a 10% shareholder of the Company at the time (prior to consideration of common shares issued in this transaction), was the manager of RFFG.

Pursuant to the Management Agreement, BMP agreed to provide services to RFFG to operate its day-to-day business, including services related to accounting, sales, finance, workers’ compensation, benefits, physical locations, information technologies and employees.  The Management Agreement provided that additional services may be added if BMP and RFFG mutually agree to the cost to be charged by BMP for such services and as long as BMP has the resources to provide such services.

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In consideration of the services provided under the Management Agreement, RFFG agreed to pay BMP monthly fees that approximate 6% of its gross revenues on an annual basis.  For the year ended September 30, 2011, the Company recorded approximately $838,000 of revenue related to this agreement.  As of September 30, 2011, BMP has $225,000 of management fee receivable.

Due to an unresolved issue with the Ohio Bureau of Workers Compensation, RFFG ceased operations as of July 15, 2011 and, as a result, the Management Agreement was effectively terminated.  As a result, the Company recorded a loss on impairment of intangible assets of $1,126,000 (as discussed further in Note 9), offset by income of $1,276,000 for the reduction of an associated earn-out liability.   There was approximately $140,000 unpaid related to this Management Agreement, which was offset against amounts owed related to certain earn-out payments provided under the original Asset Purchase Agreement.

In November 2009, the Company discovered that it did not receive the proceeds from a bank for a $2,300,000 certificate of deposit that was scheduled to mature in October 2009. Although the Company made a formal inquiry of the bank, it did not receive an adequate explanation for the bank’s non-performance related to the deposit. In December 2009, the Company entered into an agreement to assign its interests in the certificate of deposit, without recourse and the Company was reimbursed for the face value of the deposit.  At that time, management believed the certificate of deposit was purchased by an unrelated third party that had other business interests with the bank.  New information was brought to management’s attention in October 2012 and it now believes Thomas J. Bean was involved and that others, who may or may not have been related to the Company may also have been involved in the transaction.

Director Independence

The Board of Directors has determined that each director, other than Mr. Schroering, is an independent director under the listing standards of the NYSE MKT. In addition, the Board of Directors has determined that each current member of the Nominating Committee, Compensation Committee and Audit Committee meets the additional independence criteria required for such membership under the listing standards of the NYSE MKT and Rule 10A-3 of the Exchange Act.

Item 14, Principal Accountant Fees and Services.

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The Audit Committee is governed by a charter. The Audit Committee held four meetings during fiscal year 2012. The Audit Committee is comprised solely of independent directors as defined by the NYSE Amex Stock Exchange listing standards and Rule 10A-3 of the Securities Exchange Act of 1934.

Audit Committee of the Board of Directors

Dennis W. Baker, Committee Chair

Thomas C. Williams

Edward Hunter

INDEPENDENT PUBLIC ACCOUNTANTS

The Audit Committee of the Company’s Board of Directors has selected Friedman, LLP to serve as the Company’s independent registered public accounting firm and to audit the Company’s consolidated financial statements for the fiscal years ending September 30, 2012 and 2011. Friedman LLP has served as the Company’s independent registered public accounting firm since November 29, 2012.

PRINCIPAL ACCOUNTANT FEES

The following table presents fees billed or expected to be billed by BDO USA, LLP and Friedman, LLP for professional services rendered for the audit of the Company’s financial statements for the fiscal years ended September 30, 2012 and 2011, and fees billed by BDO USA, LLP during those years for other professional services:

	Fiscal		Fiscal
	2012(1)(2)		2011
Audit fees	$	350,000	$	122,000
Audit-related fees		18,000		4,000
Tax fees		—		—
All other fees		—		52,000

“Audit fees” relate to services for the audit of the Company’s consolidated financial statements for the fiscal year and for reviews of the interim consolidated financial statements included in the Company’s quarterly reports filed with the SEC.

“Audit-related fees” relate to services that are reasonably related to the audit of the Company’s consolidated financial statements and are not included in “audit fees.” These services include audits of the Company’s 401(k) retirement plan, the acquisition of certain assets of On-Site Services, Inc. and consultations on certain accounting matters.

“All other fees” relate to services rendered in connection with the subpoena issued to the Company by the SEC on February 14, 2011.

(1) Friedman, LLP performed an audit of the Company’s financial statements for the years ended, September 30, 2012 and September 30, 2011

(2) BDO USA, LLP charged the Company $50,000 for services for the year ended September 30, 2012, however did not complete the audit due to a dispute related to the audit fees required to complete the audit.

The Audit Committee’s policy is to pre-approve all audit and non-audit services provided by the independent registered public accounting firm, and to not engage them to perform the specific non-audit services proscribed by law or regulation. At the beginning of each fiscal year, the Audit Committee meets with the independent registered public accounting firm and approves the fees and services to be performed for the ensuing year. On a quarterly basis, the Audit Committee reviews the fees billed for all services provided for the year to date, and it pre-approves additional services if necessary. The Audit Committee’s pre-approval policies allow management to engage the independent registered public accounting firm for consultations on tax or accounting matters up to an aggregate of $10,000 annually. All fees listed in the table above were approved in accordance with the Audit Committee’s policies.

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PART IV

Item 15, Exhibits and Financial Statement Schedules.

Exhibits

The following exhibits are filed as part of this report:

No.	Description of Exhibit
2.01	Securities Purchase and Tender Offer Agreement, dated March 30, 2009, by and among General Employment Enterprises, Inc. and PSQ, LLC.  Incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K dated March 30, 2009, Commission File No. 1-05707.
2.02	Acquisition of Assets of On-Site Services dated June 2. 2010. Incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K dated June 8, 2010, File No. 1-05707.
2.03	Financial Statements of On-Site Services dated August 16, 2010, Incorporated by reference to Exhibit 99.1, Exhibit 99.2 and Exhibit 99.3 to the Company’s Current Report on Form 8-K dated August 16, 2010, File No. 1-05707.
3.01	Articles of Incorporation and amendments thereto. Incorporated by reference to Exhibit 3 to the Company’s Quarterly Report on Form 10-QSB for the quarter ended March 31, 1996, Commission File No. 1-05707.
3.02	By-Laws of General Employment Enterprises, Inc., as amended June 30, 2009.  Incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K dated March 30, 2009, Commission File No. 1-05707
4.01	Rights Agreement dated as of February 4, 2000, between General Employment Enterprises, Inc. and Continental Stock Transfer and Trust Company, as Rights Agent. Incorporated by reference to Exhibit 1 to the Company’s Registration Statement on Form 8-A filed with the Securities and Exchange Commission on February 7, 2000, Commission File No. 1-05707.
4.02	Amendment No. 1 to Rights Agreement, dated as of March 30, 2009, by and between General Employment Enterprises, Inc. and Continental Stock Transfer and Trust Company, as Rights Agent. Incorporated by reference to Exhibit 4.1 to the Company’s Registration Statement on Form 8-A/A filed with the Securities and Exchange Commission on March 31, 2009, Commission File No. 1-05707.
10.01*	Key Manager Plan, adopted May 22, 1990. Incorporated by reference to Exhibit 10(h) to the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 1990, Commission File No. 1-05707.
10.02*	General Employment Enterprises, Inc. 1995 Stock Option Plan. Incorporated by reference to Exhibit 4.1 to the Company’s Form S-8 Registration Statement dated April 25, 1995, Registration No. 33-91550.
10.03*	Second Amended and Restated General Employment Enterprises, Inc. 1997 Stock Option Plan.
10.04*	General Employment Enterprises, Inc. 1999 Stock Option Plan. Incorporated by reference to Exhibit 10 of the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 1999, Commission File No. 1-05707.

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10.05*	Chief Executive Officer Bonus Plan, adopted September 24, 2001. Incorporated by reference to Exhibit 10.11 to the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2001, Commission File No. 1-05707.
10.06*	Operational Vice President Bonus Plan effective for fiscal years beginning on or after October 1, 2004. Incorporated by reference to Exhibit 10.01 to the Company’s Quarterly Report of Form 10-QSB for the quarterly period ended December 31, 2004, Commission File No. 1-05707.
10.07*	Form of stock option agreement under the General Employment Enterprises, Inc. 1997 Stock Option Plan. Incorporated by reference to Exhibit 99.01 to the Company’s current report on Form 8-K dated September 25, 2006, Commission File No. 1-05707.
10.08*	Chief Executive Officer Bonus Plan Amendment 1, effective for fiscal years beginning on or after October 1, 2006. Incorporated by reference to Exhibit 10.01 to the Company’s quarterly report on Form 10-QSB for the quarterly period ended December 31, 2006, Commission File No. 1-05707.
10.09*	Form of director stock option agreement under the Amended and Restated General Employment Enterprises, Inc. 1997 Stock Option Plan. Incorporated by reference to Exhibit 10.15 to the Company’s Annual Report on Form 10-KSB for the fiscal year ended September 30, 2007, Commission File No. 1-05707.
10.10*	Form of stock option agreement under the General Employment Enterprises, Inc. 1999 Stock Option Plan. Incorporated by reference to Exhibit 10.16 to the Company’s Annual Report on Form 10-KSB for the fiscal year ended September 30, 2007, Commission File No. 1-05707.
10.11*	Form of indemnity agreement with directors and officers, adopted November 19, 2007. Incorporated by reference to Exhibit 10.20 to the Company’s Annual Report on Form 10-KSB for the fiscal year ended September 30, 2007, Commission File No. 1-05707.
10.12*	Escrow Agreement, dated as of March 30, 2009, by and among General Employment Enterprises, Inc., PSQ, LLC and Park Avenue Bank, as escrow agent.  Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K dated March 30, 2009, Commission File No. 1-05707.
10.13*	Consulting Agreement, dated as of March 30, 2009, by and among Herbert F. Imhoff, Jr., General Employment Enterprises, Inc. and PSQ LLC.  Incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K dated March 30, 2009, Commission File No. 1-05707.
10.14*	Registration Rights Agreement, dated as of March 30, 2009, by and between General Employment Enterprises, Inc., PSQ, LLC and Herbert F. Imhoff, Jr.  Incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K dated March 30, 2009, Commission File No. 1-05707.
10.15*	Amendment No. 1, dated as of June 22, 2009, to Consulting Agreement, dated as of March 30, 2009, by and among Herbert F. Imhoff, Jr., General Employment Enterprises, Inc. and PSQ LLC.  Incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K dated June 22, 2009, Commission File No. 1-05707.
10.16*	Employment Agreement between General Employment Enterprises, Inc. and Kent M. Yauch, dated June 26, 2009.  Incorporated by reference to Exhibit 10.4 to the Company’s Current Report on Form 8-K dated June 22, 2009, Commission File No. 1-05707.
10.17*	Employment Agreement between General Employment Enterprises, Inc. and Marilyn L. White, dated June 26, 2009.  Incorporated by reference to Exhibit 10.5 to the Company’s Current Report on Form 8-K dated June 22, 2009, Commission File No. 1-05707.
10.18*	Form of director stock option under the Second Amended and Restated General Employment Enterprises, Inc. 1997 Stock Option Plan.
10.19*	Form of employee stock option under the Second Amended and Restated General Employment Enterprises, Inc. 1997 Stock Option Plan.

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10.20*	Amendment No. 4 dated as of February 5, 2010 to Statement of Acquisition of Beneficial Ownership by Herbert F. Imhoff, Jr. Incorporated by reference to Form SC 13D dated February 5, 2010, Commission File No. 5-40677.
10.21	Account Purchase Agreement dated as December 14, 2010 by and betweenWells Fargo Bank, National Association and Triad Personnel Services, Inc., the Company, BMPS, Inc., BMCH, Inc. d/b/a Triad Personnel Services, and BMCH PA, Inc. d/b/a Triad Temporaries (the “Account Purchase Agreement”).  Incorporated by reference to Exhibit 10.01 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2011, Commission File No. 001-05707.
10.22	First Amendment to Account Purchase Agreement dated May 2, 2011.  Filed herewith.
10.23	Second Amendment to Account Purchase Agreement dated as February 15, 2012.  Incorporated by reference to Exhibit 99.1 to the Company’s Current Report on Form 8-K dated March 30, 2012, Commission File No. 001-05707.
10.24	Third Amendment to Account Purchase Agreement dated September 25, 2012.  Filed herewith.
10.25	Fourth Amendment to Account Purchase Agreement dated December 14, 2012.  Filed herewith.
10.26	Fifth Amendment to Account Purchase Agreement dated as January 14, 2013.  Filed herewith.
10.27	Asset Purchase Agreement, dated as of August 31, 2011, by and among General Employment Enterprises, Inc., Ashley Ellis LLC and Brad A. Imhoff.  Incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K dated September 7, 2011, Commission File No. 001-05707.
10.28	Registration Rights Agreement, dated as of August 31, 2011, by and between General Employment Enterprises, Inc. and Ashley Ellis LLC.  Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K dated September 7, 2011, Commission File No. 001-05707.
10.29	Employment Agreement, dated as of August 31, 2011, by and between General Employment Enterprises, Inc. and Katy M. Imhoff.  Incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K dated September 7, 2011, Commission File No. 001-05707.
10.30	Change of Control Agreement, dated as of August 31, 2011, by and between General Employment Enterprises, Inc. and Katy M. Imhoff.  Incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K dated September 7, 2011, Commission File No. 001-05707.
10.31	Employment Agreement, dated as of September 1, 2011, by and between General Employment Enterprises, Inc. and Salvatore J. Zizza.  Incorporated by reference to Exhibit 10.4 to the Company’s Current Report on Form 8-K dated September 7, 2011, Commission File No. 001-05707.
10.32	Change of Control Agreement, dated as of September 1, 2011, by and between General Employment Enterprises, Inc. and Salvatore J. Zizza.  Incorporated by reference to Exhibit 10.5 to the Company’s Current Report on Form 8-K dated September 7, 2011, Commission File No. 001-05707.
10.33	Employment Agreement, dated as of August 31, 2011, by and between General Employment Enterprises, Inc. and Brad A. Imhoff.  Incorporated by reference to Exhibit 10.6 to the Company’s Current Report on Form 8-K dated September 7, 2011, Commission File No. 001-05707.
10.34	Change of Control Agreement, dated as of August 31, 2011, by and between General Employment Enterprises, Inc. and Brad A. Imhoff.  Incorporated by reference to Exhibit 10.7 to the Company’s Current Report on Form 8-K dated September 7, 2011, Commission File No. 001-05707.
10.35	Registration Rights Agreement, effective as of December 30, 2010, by and among General Employment Enterprises, Inc., Triad Personnel Services, Inc., DMCC Staffing, LLC and RFFG of Cleveland, LLC.  Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K dated January 5, 2011, Commission File No. 001-05707.

61

10.36	General Employment Enterprises, Inc. 2011 Incentive Plan.  Incorporated by reference as Appendix B to the Company’s Proxy Statement dated January 23, 2012, Commission File No. 1-05707.*
10.37	Sixth Amendment to Account Purchase Agreement dated as March 27, 2013.  Filed herewith.
14.01	General Employment Enterprises, Inc. Code of Ethics for Directors, Officers and Employees, adopted as of August 16, 2004. Incorporated by reference to Exhibit 14.01 to the Company’s Form 8-K Current Report dated August 16, 2004, Commission File No. 1-05707.
23.01	Consent of Independent Registered Public Accounting Firm.
31.01	Certification of the principal executive officer required by Rule 13a-14(a) or Rule 15d-14(a) of the Exchange Act.
31.02	Certification of the principal financial officer required by Rule 13a-14(a) or Rule 15d-14(a) of the Exchange Act.
32.01	Certifications of the principal executive officer required by Rule 13a-14(a) or Rule 15d-14(a) of the Exchange Act and Section 1350 of Chapter 63 of Title 18 of the United States Code.
32.02	Certifications for the principal financial officer required by Rule 13a-14(a) or Rule 15d-14(a) of the Exchange Act and Section 1350 of Chapter 63 of Title 18 of the United States Code.
101.INS	XBRL Instant document, filed

62

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

GENERAL EMPLOYMENT ENTERPRISES, INC.

 (Registrant)

Date: 3/29/2013	By: /s/ Michael Schroering
	Michael Schroering
	Chief Executive Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Date: 3/29/2013	By: /s/ Michael Schroering
	Michael Schroering
	Chief Executive Officer
	(Principal executive officer)
Date: 3/29/2013	By: /s/ Andrew J. Norstrud
	Andrew J. Norstrud
	Chief Financial Officer
	(Principal financial and accounting officer)
Date: 3/29/2013	By: /s/ Dennis W. Baker
	Dennis W. Baker, Director
Date: 3/29/2013	By: /s/ Edward Hunter
	Edward Hunter, Director
Date: 3/29/2013	By: /s/ Thomas C. Williams
	Thomas C. Williams, Director

63

EX-10.22

EXHIBIT 10.22

AMENDATORY AND JOINDER AGREEMENT

THIS AMENDATORY AND JOINDER AGREEMENT THE FIRST AMENDMENT TO ACCOUNT PURCHASE AGREEMENT ("Joinder") is dated this 2nd day of May 2011, by and among, Wells Fargo Bank, National Association, ("WFB"), and Triad Personnel Services, Inc. an Illinois corporation, General Employment Enterprises, Inc. an Illinois corporation and BMPS, Inc. an Ohio corporation (collectively "TRIAD"), BMCH, Inc. d/b/a Triad Personnel Services, an Ohio corporation ("BMCHOH") and BMCHPA, Inc. d/b/a Triad Temporaries, a Pennsylvania corporation ("BMCHPA") (collectively "Customer"). The Customer and WFB jointly and severally agree as follows:

WHEREAS,  TRIAD and WFB are parties to that certain Account Purchase Agreement dated December 14, 2010, as amended from time to time (the "APA"); and

WHEREAS,  BMCHOH and BMCHPA (jointly "BMCH")  desire to join in and be bound by the terms of the APA as if it were an original signer to the APA, desires to grant a security interest in all of its assets to WFB, and desires to be included within the term "Customer" as provided in the APA; and

WHEREAS,  the parties desire to amend the APA as more fully set forth herein; and

WHEREAS,  WFB agrees to the above, subject to the terms of this Joinder

NOW THEREFORE,  it is agreed among the parties as follows:

1. The above recitations are true and correct and binding upon BMCH and TRIAD.

2.  BMCH hereby joins in the execution of the APA, agrees to be treated as a Customer thereunder and agrees to abide by and perform all of the terms thereof  and ratifies each representation  and warranty made hereto.

3. BMCH hereby grants to WFB a first priority security interest in all Collateral, as defined in the APA.

4. TRIAD consents to the Joinder by BMCH and further reaffirms all of its obligations to WFB under the APA, and confirms that the APA is in full force and effect and binding against Triad, without any setoffs, defenses  or counterclaims of any kind whatsoever.

5.  The APA is hereby amended as follows:

a. Section 3.10 is hereby deleted in its entirety and the following is substituted in its place:

"3.10 Remittance Information: Customer shall make a notation on each original invoice (or the electronic equivalent of an invoice) or other such documentation accepted by WFB for each Account purchased hereunder which indicates that such Account should be paid in accordance with the following address instructions:

Mail instructions:

Triad Personnel Services, Inc. or BMPS, Inc.

or BMCH, Inc. d/b/a TRIAD Temporaries

or BMCHPA, Inc. d/b/a Triad Temporaries

PO Box 823424

Philadelphia, PA 19182-3424

Or

1

Wire Instructions:

Wells Fargo Bank, N.A.

San Francisco, CA

For the account of Wells Fargo/ Wells Fargo Business Credit

Account#4121894000

ABA for Wire#121000248

ABA for ACH#121000248

For Further Credit (Triad Personnel Services, Inc. or BMPS, Inc. or

BMCH, Inc. d/b/a TRIAD Temporaries or BMCHPA, Inc. d/b/a Triad Temporaries)

In the event any invoice (or the electronic equivalent of an invoice) is sent or transmitted to any Account Debtor without the required notation, a fee equal to two and one half percent (2.5%) of the face amount of such invoice shall be assessed.

b. Section 6.03 is hereby deleted in its entirety and the following is substituted in its place:

"6.03    Notation of Assignment:  Upon the request of WFB, and in any event upon the occurrence of an Event of Default, Customer shall make a notation on each original invoice  (or  the  electronic  equivalent  of  an  invoice)  or  other  such  documentation accepted by WFB for each Account purchased hereunder which indicates that such Account has been sold, transferred and assigned and/or sold to WFB with the following language: This invoice has been sold, transferred and assigned to and is payable to:

Mail instructions:

Wells Fargo Business Credit

PO Box 823424

Philadelphia, PA 19182-3424

or

Wire Instructions:

Wells Fargo Bank, N.A.

San Francisco, CA

For the account of Wells Fargo/ Wells Fargo Business Credit

Account#4121894000

ABA for Wire#121000248

ABA for ACH#121000248

For Further Credit (Triad Personnel Services, Inc. or BMPS, Inc. or

BMCH, Inc. d/b/a Triad Personnel Services or BMCHPA, Inc. d/b/a Triad Temporaries)

In the event any invoice (or the electronic equivalent of an invoice) is sent or transmitted to any Account Debtor without the required notation, a fee equal to two and one half percent (2.5%) of the face amount of such invoice shall be assessed."

c. Section 10.15 is hereby deleted in its entirety and the following is substituted in its place:

"10.15.   JOINT AND SEVERAL OBLIGATIONS; DEALINGS WITH MULTIPLE CUSTOMERS. If more than one person or entity is named as Customer hereunder, all obligations owed to WFB by Customer ("Obligations"), representations, warranties, covenants and indemnities set forth herein or in any other APA Documents between the Customer, WFB and any guarantors of the Obligations to WFB (collectively the "APA Documents") to which such person or entity is a party shall be joint and several.  WFB shall have the right to deal with any individual of any Customer with regard to all matters concerning the rights and obligations of WFB and Customer hereunder and pursuant to applicable law with regard to the transactions contemplated under the APA Documents.  All actions or inactions of the officers, managers, members and/or agents of any Customer with regard to the transactions contemplated under the APA Documents shall be deemed with full authority and binding upon all Customers hereunder. Each Customer hereby appoints each other Customer as its true and lawful attorney-in-fact, with full right and power, for purposes of exercising all rights of such person hereunder and under applicable law with regard to the transactions contemplated under the APA Documents. The foregoing is a material inducement to the agreement of WFB to enter into this Agreement and to consummate the transactions contemplated hereby. The Customer represents that TRIAD PERSONNEL SERVICES, INC., GENERAL EMPLOYMENT ENTERPRISES, INC., BMPS, INC., BMCH, INC. d/b/a TRIAD Temporaries and BMCHPA, INC. d/b/a TRIAD TEMPORARIES are operated as part of one consolidated business entity and are directly dependent upon each other for and in connection with their respective business activities and financial resources. Each Customer will receive a direct economic and financial benefit from the Obligations incurred under this Agreement and the incurrence of such Obligations is in the best interests of each Customer."

2

The joint and several obligations of each of the undersigned under this Agreement shall be absolute and unconditional and shall remain in full force and effect until all Obligations shall have been paid and, until such payment has been made, shall not be discharged, affected, modified or impaired on the happening from time to time of any event, including, without limitation, any of the following, whether or not with notice to or the consent of any of the undersigned:

(a)  the waiver, compromise, settlement, release, termination or amendment (including, without limitation, any extension or postponement of the time for payment or performance or renewal or refinancing) of any or all of the obligations or agreements of any of the undersigned under this Agreement or any of the other APA Documents:

(b)  the failure to give notice to any or all of the undersigned of the occurrence of a default under the terms and provisions of this Agreement or any of the other APA Documents:

(c)  the release, substitution or exchange by the holder of this Agreement of any Collateral(whether with or without consideration) or the acceptance by the WFB of any additional collateral or the availability or the claimed availability of any other collateral or source of repayment or any nonperfection or other impairment of any Collateral;

(d)  the release of any person primarily or secondarily liable for all or any part of the Obligations, whether by WFB or any other holder of this Agreement or in connection with any voluntary or involuntary liquidation, dissolution, receivership, insolvency, bankruptcy, assignment for the benefit of creditors or similar event or proceeding affecting any or all of the undersigned or any other person or entity who, or any of whose property, shall at the time in question be obligated in respect of the Obligations or any part thereof; or

(e)  to the extent permitted by law, any other event, occurrence, action or circumstance that would, in the absence of this clause, result in the release or discharge of any or all of the undersigned  from  the  performance  or  observance  of  any  obligation,  covenant  or agreement contained in this Agreement.

The joint and several obligations of the undersigned to WFB under this Agreement shall remain in full force and effect (or be reinstated) until WFB has received payment in full of all Obligations and the expiration of any applicable  preference or similar period pursuant to any bankruptcy, insolvency, reorganization, moratorium or similar laws, or at law or equity, without any claim having been made before the expiration of such period asserting an interest in all or any part of any payment(s) received by WFB.

3

The undersigned expressly agree that WFB shall not be required first to institute any suit or to exhaust its remedies against any of the undersigned or any other person or party to become liable hereunder or against any Collateral, in order to enforce this Agreement; and expressly agree that notwithstanding the occurrence of any of the foregoing, the undersigned shall be and remain, directly and primarily liable for all sums due under this Agreement and under the APA Documents. On disposition by WFB of any property encumbered by any Collateral, the undersigned shall be and shall remain jointly and severally liable for any deficiency."

6. The Guarantors, Salvatore J. Zizza, Herbert F. Imhoff, Jr. and James R. Harlan (collectively "Guarantor"), by signing below, consent to the terms of this Amendatory and Joinder Agreement to Account Purchase Agreement, reaffirms the terms of their validity Guaranty (the "Guaranty"), confirms that the Guaranty is in full force and effect and binding upon them without any defenses, setoffs or counterclaims of any kind whatsoever.

7.  To induce WFB to enter into this Joinder, Customer (a) acknowledges and agrees that no right of offset, defense, counterclaim, claim or objection exists in favor of Customer against WFB arising out of or with respect to the APA, the other APA Documents, the Obligations, or any other arrangement or relationship between WFB and Customer, and (b) releases, acquits, remises and forever discharges WFB and its affiliates and all of its past, present and future officers, directors, employees, agents, attorneys, representatives, successors and assigns from any and all claims, demands, actions and causes of action, whether at law or in equity and whether known or unknown, which Customer may have by reason of any manner, cause or things to and including the date of this Joinder with respect to matters arising out of or with respect to the APA, the other APA Documents, the Obligations, or any other arrangement or relationship between WFB and Customer.

7.  All capitalized terms not otherwise defined herein shall have the meanings ascribed to them in the Agreement.

8. Except as above amended, the Agreement remain in full force and effect and binding upon the Customer without any defenses, setoffs or counterclaims of any kind whatsoever.

IN WITNESS WHEREOF, the parties have hereto set their hands and seals as of the date first above written.

Triad Personnel Services, Inc.
By:	/s/Salvatore J. Zizza
	Salvatore J. Zizza, CEO

General Employment Enterprises, Inc.
By:	/s/Salvatore J. Zizza
	Salvatore J. Zizza, CEO

4

BMPS, Inc.
By:	/s/Salvatore J. Zizza
	Salvatore J. Zizza, CEO

BMCHPA, Inc. d/b/a Triad Temporaries
By:	/s/Salvatore J. Zizza
	Salvatore J. Zizza, CEO

BMCHPA, Inc. d/b/a Triad Temporaries
By:	/s/Salvatore J. Zizza
	Salvatore J. Zizza, CEO

Guarantor:
By:	/s/Salvatore J. Zizza
	Salvatore J. Zizza, Individually

STATE OF	Illinois	)
		) SS:
COUNTY OF	DuPage	)

The foregoing instrument was acknowledged before me this 29th day of April 2011 by Salvatore J. Zizza, individually and as CEO of each Triad Personnel Services, Inc. an Illinois corporation, General Employment Enterprises, Inc. an Illinois corporation BMPS, Inc. an Ohio corporation, BMCH, Inc. d/b/a Triad Temporaries, an Ohio corporation and BMCHPA, Inc. d/b/d Triad Temporaries, a Pennsylvania corporation, on behalf of the corporations. He x is personally known to me or o has produced ______________________, as identification.

Sherry L. Hunacek Sielepkowski
Notary Public,
My Commission Expires:	4-4-2012
Print Name:	Sherry L. Hunacek Sielepkowski
Commission Number:	694585
[NOTARY SEAL]

5

Guarantor:
By:	/s/Herbert F. Imhoff
	Herbert F. Imhoff, Jr., Individually

STATE OF	Illinois	)
		) SS:
COUNTY OF	DuPage	)

The foregoing instrument was acknowledged before me this 2nd day of May 2011 by Herbert F. Imhoff, Jr., individually. He x is personally known to me or o has produced ______________________, as identification.

	Sherry L. Hunacek Sielepkowski
	Notary Public,
	My Commission Expires:	4-4-2012
	Print Name:	Sherry L. Hunacek Sielepkowski
	Commission Number:	694585
	[NOTARY SEAL]

Guarantor:
By:	/s/James R. Harlan
	James R. Harlan, Individually

STATE OF	Illinois	)
		) SS:
COUNTY OF	DuPage	)

The foregoing instrument was acknowledged before me this 2nd day of May 2011 by James R. Harlan, individually. He x is personally known to me or o has produced ______________________, as identification.

Sherry L. Hunacek Sielepkowski
Notary Public,
My Commission Expires:	4-4-2012
Print Name:	Sherry L. Hunacek Sielepkowski
Commission Number:	694585
[NOTARY SEAL]

6

Wells Fargo Bank, National Association
By:	/s/ Julie K. Johnston
	Julie K. Johnston, Vice President

7

AFFIDAVIT OF OUT-OF-STATE DELIVERY

STATE OF	TEXAS	)
COUNTY OF	DALLAS	)

BEFORE ME, the undersigned  authority, personally appeared the undersigned  Julie K. Johnston (the "Affiant"), who being first duly sworn upon oath, deposes and says that:

1.      The Affiant is a Vice President  of Wells Fargo Bank, National Association  ("WFB"),  and the Affiant is duly authorized to and does make this affidavit in said capacity on behalf of WFB.

2.     That on the date sworn to and subscribed below, I executed on behalf of WFB on the date referenced below that certain Amendatory and Joinder Agreement (the "Joinder"), which Joinder is between Triad Personnel Services, Inc. an Illinois corporation, General Employment Enterprises, Inc. an Illinois corporation and BMPS, Inc. an Ohio corporation (collectively "TRIAD"), BMCH, Inc. d/b/a TRIAD Temporaries, an Ohio corporation ("BMCHOH") and BMCHPA, Inc. d/b/a Triad Temporaries, a Pennsylvania corporation ("BMCHPA") (collectively "Customer") as Customer, and Wells Fargo Bank, National Association.

3.     That the execution of the Agreement by WFB took place in Dallas, Texas.

FURTHER AFFIANT SAYETH NAUGHT.

By:	/s/ Julie K. Johnston
	Julie K. Johnston, Vice President

SWORN TO AND SUBSCRIBED  before me this 5th day of May 2011 by Julie K. Johnston, who personally appeared before me, and who is personally known to me.

	Shelly Scott
	[NOTARY SEAL]
	Notary Print, State of	Texas
	Print Name:	Shelly Scott
	My Commission Expires:

 8

EX-10.24

EXHIBIT 10.24

THIRD AMENDMENT TO ACCOUNT  PURCHASE AGREEMENT AND OTHER DOCUMENTS

This THIRD AMENDMENT TO ACCOUNT PURCHASE AGREEMENT AND OTHER DOCUMENTS (this "Amendment") is entered into as of September 25, 2012 by and between TRIAD PERSONNEL SERVICES, INC., an Illinois corporation, GENERAL EMPLOYMENT  ENTERPRISES, INC., an Illinois corporation, BMPS, INC., an Ohio corporation, BMCH, INC. d/b/a TRIAD PERSONNEL SERVICES, an Ohio corporation, and BMCHPA, INC. d/b/a TRIAD TEMPORARIES, a Pennsylvania corporation (collectively, "Customer"), and WELLS FARGO BANK, NATIONAL ASSOCIATION, acting through its WELLS FARGO BUSINESS CREDIT operating division ("WFBC").

WHEREAS, Customer and WFBC have entered into certain accounts purchase arrangements pursuant to that certain Account  Purchase Agreement, dated as of December  14, 2010 (as amended, restated, renewed, extended, supplemented, substituted and otherwise modified from time to time, the "Account Purchase Agreement"), between Customer and WFBC, and certain other instruments, agreements and documents executed and/or delivered in connection therewith (all such instruments, agreements  and  documents, as amended, restated, renewed, extended, supplemented, substituted and otherwise modified from time to time, together with the Account Purchase Agreement, collectively, the "Documents");

WHEREAS, effective October 1, 2012, WFBC will implement the Receivables Financing System, an internet-based system for the management of the accounts purchase arrangements between Customer and WFBC;

WHEREAS, the implementation of the Receivables Financing System requires certain modifications to the Account Purchase Agreement; and

WHEREAS, Customer and WFBC have agreed to amend and modify certain provisions of Account Purchase Agreement, subject to the terms and conditions of this Amendment.

NOW, THEREFORE, upon the mutual agreements and covenants set forth herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

1.Definitions. Capitalized terms used and not defined in this Amendment shall have the respective meanings given them in the Account Purchase Agreement.

2.Amendment to Agreements. Under the Receivables Financing System, WFBC will implement modifications to certain accounting methods and operational procedures for various matters, including, without limitation, matters pertaining to the payment of the purchase price for Acceptable Accounts, the application of the proceeds of Acceptable Accounts, and the accounting of the Collected Reserve.

        (a)               AcceptableAccountsandtheCollectedReserve.  Notwithstanding anything to the contrary set forth in the Account Purchase Agreement or in any other Document, from and after October 1, 2012 (the "Amendment Effective Date"):

(1)          All amounts payable to Customer under the Account Purchase Agreement shall be paid by WFBC crediting such amounts to the Collected Reserve.

(2)         From time to time, the Collected Reserve may reflect a credit balance if the aggregate amounts funded by WFBC to the Collected Reserve, including for the purchase of Acceptable Accounts and amounts collected in respect of an Account, less any reserves established by WFBC, in its sole discretion, exceed the aggregate amount of funds drawn by or paid to the Customer from the Collected Reserve (such credit balance, if any, the "Available Amount"). The Available Amount shall constitute part of the Collateral, and absent the occurrence of an Event of Default, such Available Amount may be made available to Customer, in WFBC's discretion, upon Customer's written request.

(b)MinimumFee. Notwithstanding anything to the contrary set forth in the Account Purchase Agreement or in any other Document, from and after the Amendment Effective Date, Customer shall pay the Minimum Fee on the last day of each month. Each Minimum Fee shall be fully earned when due, may be charged by WFBC to the Collected Reserve and shall not be subject to refund, rebate or proration for any reason whatsoever.

3.Effect of this Amendment. Except as specifically set forth herein, no other changes or modifications to the Account Purchase Agreement or the other Documents are intended or implied, and, in all other respects, the Account Purchase Agreement and the other Documents shall continue to remain in full force and effect in accordance with their respective terms as of the date hereof. This Amendment, and the instruments and agreements delivered pursuant hereto and thereto constitute the entire agreement of the parties with respect to the subject matter hereof and thereof, and supersede all prior oral or written communications, memoranda, proposals, negotiations, discussions, term sheets and commitments with respect to the subject matter hereof and thereof. To the extent of any conflict between any term of this Amendment and any term of the Account Purchase Agreement or any other Document, the term of this Amendment shall control. Except as specifically set forth herein, nothing contained herein shall evidence a waiver or amendment by WFBC of any other provision of the Account Purchase Agreement or the Documents.

4.Further Assurances. Customer shall execute and deliver such additional documents and take such additional action as may be reasonably requested by WFBC to effectuate the provisions and purposes of this Amendment.

5.Binding Effect. This Amendment shall be binding upon and inure to the benefit of each of the parties hereto and their respective successors and assigns.

6.Governing Law. The rights and obligations hereunder of each of the parties hereto shall be governed by and interpreted and determined in accordance with the internal laws of the State of Texas (without giving effect to principles of conflict of laws).

7.Counterparts. This Amendment may be signed in counterparts, each of which shall be an original and all of which taken together constitute one agreement. In making proof of this Amendment, it shall not be necessary to produce or account for more than one counterpart signed by the party to be charged. Delivery of an executed counterpart of this Amendment electronically or by facsimile shall be effective as delivery of an original executed counterpart of this Amendment.

[Signature page follows]

Each of the parties has signed this Amendment as of the day and year first above written.

TRIAD PERSONNEL SERVICES, INC.
By:	/s/ Salvatore J. Zizza
Title:	CEO

STATE OF	Illinois	)
		)
COUNTY OF	Du Page	)

The foregoing instrument acknowledged before me this 11th day of December2012, by Salvatore J. Zizza, as CEO, of TRIAD PERSONNEL SERVICES, INC., an Illinois corporation, on behalf of the corporation. He/She is x personally known to me or o has produced _____________________as identification and did (did not) take an oath.

	/s/ Marlene E Justus
	(Notary Signature)
(NOTARY SEAL)	Marlene E Justus
	(Notary Narne Printed)

NOTARY PUBLIC Commission No.
My Commission Expires:	5/24/2013

GENERAL EMPLOYMENT ENTERPRISES, INC.
By:	/s/ Salvatore J. Zizza
Title:	CEO

STATE OF	Illinois	)
		)
COUNTY OF	Du Page	)

    The foregoing instrument acknowledged before me this 11th day of December2012, by Salvatore J. Zizza, as CEO, of GENERAL EMPLOYMENT ENTERPRISES, INC., an Illinois corporation, on behalf of the corporation. He/She is x personally known to me or o has produced ___________________________ as identification and did (did not) take an oath.

	/s/ Marlene E. Justus
	(Notary Signature)
(NOTARY SEAL)	Marlene E Justus
	(Notary Narne Printed)

NOTARY PUBLIC Commission No.
My Commission Expires:	5/24/2013

BMPS, INC.
By:	/s/ Salvatore J. Zizza
Title:	CEO

STATE OF	Illinois	)
		)
COUNTY OF	Du Page	)

The foregoing instrument acknowledged before me this 11th day of December2012, by Salvatore J. Zizza, as CEO, of BMPS, INC., an Ohio corporation, on behalf of the corporation.  He/She is x personally known to me or o has produced ___________________________ as identification and did (did not) take an oath.

	/s/ Marlene E Justus
	(Notary Signature)
(NOTARY SEAL)	Marlene E Justus
	(Notary Narne Printed)

NOTARY PUBLIC Commission No.
My Commission Expires:	5/24/2013

BMCH, INC. d/b/a TRIAD PERSONNEL SERVICES
By:	/s/ Salvatore J. Zizza
Title:	CEO

STATE OF	Illinois	)
		)
COUNTY OF	Du Page	)

           The foregoing instrument acknowledged before me this 11th day of December2012, by Salvatore J. Zizza, as CEO, of BMCH, INC. d/b/a TRIAD PERSONNEL SERVICES, an Ohio corporation, on behalf of the corporation.  He/She is x personally known to me or o has produced ___________________________ as identification and did (did not) take an oath.

	/s/ Marlene E Justus
	(Notary Signature)
(NOTARY SEAL)	Marlene E Justus
	(Notary Narne Printed)

NOTARY PUBLIC Commission No.
My Commission Expires:	5/24/2013

BMCHPA, INC. d/b/a TRIAD TEMPORARIES
By:	/s/ Salvatore J. Zizza
Title:	CEO

STATE OF	Illinois	)
		)
COUNTY OF	Du Page	)

           The foregoing instrument acknowledged before me this 11th day of December2012, by Salvatore J. Zizza, as CEO, of BMCHPA, INC. d/b/a TRIAD TEMPORARIES, a Pennsylvania corporation, on behalf of the corporation.  He/She is x personally known to me or o has produced ___________________________ as identification and did (did not) take an oath.

	/s/ Marlene E Justus
	(Notary Signature)
(NOTARY SEAL)	Marlene E Justus
	(Notary Narne Printed)

NOTARY PUBLIC Commission No.
My Commission Expires:	5/24/2013

WELLS FARGO BANK, NATIONAL ASSOCIATION
By:	/s/ Tom Chapman
Title:	Authorized Signatory

AFFIDAVIT OF OUT-OF-STATE DELIVERY

STATE OF	Texas	)
		)
COUNTY OF	Dallas	)

BEFORE ME, the undersigned authority, personally appeared the undersigned Tom Chapman (the "Affiant"), who being first duly sworn upon oath, deposes and says that:

1.        The Affiant is a AVP of WELLS FARGO BANK, NATIONAL ASSOCIATION, acting through its WELLS FARGO BUSINESS CREDIT operating division ("WFBC"), and the Affiant is duly authorized to and does make this affidavit in said capacity on behalf of WFBC.

2.            That on the ______________ day of ____________________________  2012, the Affiant received delivery in Dallas, Texas, on behalf of WFBC, of  that certain THIRD AMENDMENT TO ACCOUNT PURCHASE AGREEMENT AND OTHER DOCUMENTS (the  ''Amendment"), which Amendment is between TRIAD PERSONNEL SERVICES, INC., GENERAL EMPLOYMENT ENTERPRISES, INC., BMPS, INC., BMCH, INC. d/b/a TRIAD PERSONNEL SERVICES, BMCHPA, )NC. d/b/a TRIAD TEMPORARIES and WFBC.

FURTHER AFFIANT SAYETH NAUGHT.

/s/ Tom Chapman
Tom Chapman	, Affiant
Assistant Vice President	, Title

SWORN TO AND SUBSCRIBED before me this of 14th day of December 2012, by Tom Chapman as AVP, of WELLS FARGO BANK, NATIONAL ASSOCIATION, acting through its WELLS FARGO BUSINESS CREDIToperating division, on behalf of the association. He/She is o personally known to me or o has produced ___________________________ as identification and did (did not) take an oath.

	/s/ Shelly Ann Scott
	(Notary Signature)
(NOTARY SEAL)	Shelly Ann Scott
	(Notary Narne Printed)

NOTARY PUBLIC Commission No.		00481390-0
My Commission Expires:	3-15-15

EX-10.25

Exhibit 10.25

FOURTH AMENDMENT TO ACCOUNT PURCHASE AGREEMENT

THIS FOURTH AMENDMENT, dated as of December 14th, 2012 is entered into by and between WELLS FARGO BANK, National Association ("WFB" or "WFBC") and TRIAD PERSONNEL SERVICES, INC. an Illinois corporation, GENERAL EMPLOYMENT ENTERPRISES, INC., an Illinois corporation and BMPS, INC., an Ohio corporation (collectively ''TRIAD"), BMCH, INC. d/b/a TRIAD TEMPORARIES, an Ohio corporation ("BMCHH"} and BMCHPA, INC. d/b/a Triad Temporaries, a Pennsylvania corporation ("BMCHPA") (collectively "Customer").

RECITALS:

a)  WFB and Customer are parties to an Account Purchase Agreement dated December 14, 2010, as further amended by that certain Amendatory and Joinder Agreement, the First Amendment to Account Purchase Agreement dated as of May 2, 2011, as further amended by that certain Second Amendment to Account Purchase Agreement dated as of February 15, 2012, as further amended by that certain Third Amendment to Account Purchase Agreement dated as of December 13,2012 (as amended, the "Agreement").

b)  Customer and WFB have agreed to certain modifications of the Agreement as a result of the ongoing business relationship between the parties.

AGREEMENT

IN CONSIDERATION of the above recitals and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:

1.          The above recitals are true and correct and are incorporated herein by this reference.

2.          Each of the terms defined in the Agreement unless otherwise defined herein, shall have the same meaning when used herein.

3.          In the event of a conflict between the terms and provisions of this Amendment and the terms and provisions of the Agreement, the terms and provisions of this Amendment shall control.

4.          The terms of the Agreement are hereby amended as follows:

  a.    Section2.18isherebydeletedinitsentiretyandthefollowingissubstitutedinitsplace:

 "2.18 ''Term" shall mean January 14, 2013."

5.          The Guarantors, Salvatore J. Zizza, Herbert F. Imhoff, Jr. and Jarrett A. Misch (collectively "Guarantor"), by signing below, consent to the terms of this Fourth Amendment to Account Purchase Agreement, reaffirm the terms of their Guaranty (collectively the "Guaranty"), confirm that the Guaranty is in full force and effect and binding upon them without any defenses, setoffs or counterclaims of any kind whatsoever.

6.          Except as above amended, the Agreement remains in full force and effect and binding upon the Customer without any defenses, setoffs or counterclaims of any kind whatsoever.

7.          This Amendment shall be deemed to be a contract under and subject to and shall be construed for all purposes and in accordance with the laws of the State of Texas.

8.          This Amendment may be executed in two or more counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument.

9.         To Induce WFB to enter into this Fourth Amendment to Account Purchase Agreement, Customer, together with Guarantor (a) acknowledge and agree that no right of offset, defense, counterclaim, claim or objection exists in favor of Customer and/or Guarantor against WFB arising out of or with respect to the Agreement, the Guaranty, or any other arrangement or relationship between WFB and Customer and/or Guarantor, and (b) release, acquit, remise and forever discharge WFB and its affiliates and all of their past, present and future officers, directors, employees, agents, attorneys, representatives, successors and assigns from any and all claims, demands, actions and causes of action, whether at law or in equity and whether known or unknown, which Customer and Guarantor may have by reason of any manner, cause or things to and including the date of this Fourth Amendment to Account Purchase Agreement with respect to matters arising out of or with respect to the Agreement, the Guaranty, or any other arrangement or relationship between WFB and customer and/or Guarantor.

IN WITNESS WHEREOF, the parties have executed and delivered this Amendment which shall be effective with the date of the Amendment.

Triad Personnel Services,Inc.
By	/s/ Salvatore J.Zizza
	Salvatore J.Zizza, CEO
General Employment Enterprises, Inc.
By	/s/ Salvatore J.Zizza
	Salvatore J.Zizza, CEO
BMPS, Inc.
By	/s/ Salvatore J.Zizza
	Salvatore J.Zizza, CEO
BMCH, Inc. d/b/a Triad Temporaries
By	/s/ Salvatore J.Zizza
	Salvatore J.Zizza, CEO
BMCHPA, Inc. d/b/a Triad Temporaries
By	/s/ Salvatore J.Zizza
	Salvatore J.Zizza, CEO

2

VALIDITY GUARANTOR:
By
	Salvatore J.Zizza, Individually
By	/s/ Herbert F. Imhoff, Jr.
	Herbert F. Imhoff, Jr., Individually, as to validity only
By
	Jarett A. Misch, Individually

STATEOF

COUNTYOF

The foregoing instrument was acknowledged before me this _____ day of December 2012 by Salvatore J. Zizza, individually and as CEO of Triad Personnel Services Inc. an Illinois corporation, General Employment Enterprises, Inc. an Illinois corporation BMPS, Inc. an Ohio corporation, BMCH, Inc. d/b/a Triad Temporaries, an Ohio corporation and BMCHPA, Inc. d/b/a Triad Temporaries, a Pennsylvania corporation, on behalf of the corporations. He [ ] is personally known to me or [ ] has produced ________________, as identification.

	(Notary Signature)
(NOTARY SEAL)
	(Notary Name Printed)
	NOTARY PUBLIC Commission No.

STATEOF	Illinois
COUNTYOF	DuPage

The foregoing instrument was acknowledged before me this 14th day of December 2012 by Herbert F. Imhoff, Jr., individually. He x is personally known to me or [ ] has produced ___________________, as identification.

	/s/ Marlene E. Justus
	(Notary Signature)
(NOTARY SEAL)
	Marlene E. Justus
	(Notary Name Printed)
	NOTARY PUBLIC Commission No.

3

VALIDITY GUARANTOR:
By	/s/ Salvatore J.Zizza
	Salvatore J.Zizza, Individually
By
	Herbert F. Imhoff, Jr., Individually
By	/s/ Jarett A. Misch
	Jarett A. Misch, Individually

STATEOF	Illinois
COUNTYOF	DuPage

The foregoing instrument was acknowledged before me this 14th day of December 2012 by Salvatore J. Zizza, individually and as CEO of Triad Personnel Services Inc. an Illinois corporation, General Employment Enterprises, Inc. an Illinois corporation BMPS, Inc. an Ohio corporation, BMCH, Inc. d/b/a Triad Temporaries, an Ohio corporation and BMCHPA, Inc. d/b/a Triad Temporaries, a Pennsylvania corporation, on behalf of the corporations. He x is personally known to me or [ ] has produced ________________, as identification.

	/s/ Marlene E. Justus
	(Notary Signature)
(NOTARY SEAL)
	Marlene E. Justus
	(Notary Name Printed)
	NOTARY PUBLIC Commission No.

STATEOF	Illinois
COUNTYOF	DuPage

The foregoing instrument was acknowledged before me this 14th day of December 2012 by Salvatore J. Zizza, Jarett Misch, individually. They x are personally known to me or [ ] has produced ________________, as identification.

	/s/ Marlene E. Justus
	(Notary Signature)
(NOTARY SEAL)
	Marlene E. Justus
	(Notary Name Printed)
	NOTARY PUBLIC Commission No.

4

Wells Fargo Bank, National Association
By	/s/Jason M. Cole
	Jason M. Cole, Senior Vice president

5

AFFIDAVIT OF OUT-OF-STATE DELIVERY

STATE OF TEXAS   )

COUNTY OF DALLAS )

BEFORE ME, the undersigned authority, personally appeared the undersigned Jason M. Cole (the "Affiant"), who being first duly sworn upon oath, deposes and says that:

1.The Affiant is a Senior Vice President of Wells Fargo Bank, National Association {"WFB"), and the Affiant is duly authorized to and does make this affidavit in said capacity on behalf of WFB.

2. That on the date sworn to and subscribed below, I executed on behalf of WFB on the date referenced below that certain Fourth Amendment to Account Purchase Agreement (the "Agreement"), which Agreement is between Triad Personnel Services, Inc. an Illinois corporation, General Employment Enterprises, Inc. an Illinois corporation and BMPS, Inc. an Ohio corporation (collectively "TRIAD"), BMCH, Inc. d/b/a Triad Temporaries, an Ohio corporation ("BMCHOH") and BMCHPA, Inc. d/b/a Triad Temporaries, a Pennsylvania corporation ("BMCHPA") (collectively "Customer") as Customer, and Wells Fargo Bank, National Association.

3. That the execution of the Agreement by WFB took place in Dallas, Texas.

FURTHER AFFIANT SAYETH NAUGHT.

/s/ Jason M. Cole

Jason M. Cole, Senior Vice president

SWORN TO AND SUBSCRIBED before me this 15thday of December 2012 by Jason M. Cole, who personally appeared before me, and who is personally known to me.

/s/ Shelly Scott

[NOTARIAL SEAL]

Notary Public, State of Texas

Print Name: Shelly Scott

My Commission Expires: 3-15-15

6

EX-10.26

EXHIBIT 10.26

FIFTH AMENDMENT TO ACCOUNT PURCHASE AGREEMENT AND OTHER DOCUMENTS

This FIFTH AMENDMENT TO ACCOUNT PURCHASE AGREEMENT (this "Amendment") is entered into as of January 11, 2013 by and among TRIAD PERSONNEL SERVICES, INC., an Illinois corporation ("Personnel"), GENERAL EMPLOYMENT ENTERPRISES, INC., an Illinois corporation ("GEE"), BMPS, INC., an Ohio corporation ("BMPS"; and together with Personnel and GEE, collectively, "Triad"), BMCH, Inc., d/b/a Triad Temporaries, an Ohio corporation ("BMCHOH") and BMCHPA, INC., d/b/a Triad Temporaries, a Pennsylvania corporation ("BMCHPA"; and together with BMCHOH and Triad, collectively, the "Customer"), and WELLS FARGO BANK, NATIONAL ASSOCIATION, acting through its WELLS FARGO BUSINESS CREDIT operating division ("WFB" or "WFBC").

WHEREAS, Customer and WFBC have entered into certain accounts purchase arrangements pursuant to that certain Account Purchase Agreement, dated as• of December 14, 2010 (as amended, restated, renewed, extended, supplemented, substituted and otherwise modified from time to time, the "Account Purchase Agreement"), between Customer and WFBC, and certain other instruments, agreements and documents executed and/or delivered in connection therewith (all such instruments, agreements and documents, as amended, restated, renewed, extended, supplemented, substituted and otherwise modified from time to time, together with the Account Purchase Agreement, collectively, the "Documents");

WHEREAS, Customer has requested that WFBC agree, and WFBC has agreed, to amend and modify certain provisions of Account Purchase Agreement, subject to the terms and conditions of this Amendment.

NOW, THEREFORE, upon the mutual agreements and covenants set forth herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

1.Definitions. Capitalized terms used and not defined in this Amendment shall have the respective meanings given them in the Account Purchase Agreement.

2.Extension of Delivery Date. Notwithstanding anything to the contrary set forth in Section 4.03(g) of the Account Purchase Agreement, for Customer's fiscal year ended September 30, 2012, Customer will furnish to WFBC on or before March 15, 2013 Audited fiscal year end financial statements acceptable to WFBC in its sole discretion, including, but not limited to a statement of profit and loss, statement of cash flow and a balance sheet, and satisfactory proof of payment and compliance with all federal, state and local tax requirements. The date on which Customer must submit Audited fiscal year end financial statements for each of Customer's fiscal years ending after September 30, 2012 shall be as provided in Section 4.03(g) of the Accounts Purchase Agreement.

3.            Amendment to Account Purchase Agreement.

(a)           Definitions.   The definition of "Term" appearing in Section 2.18 of the Account Purchase Agreement is hereby amended and restated in its entirety to read as follows:

"2.18"Term"shallmeantheperiodoftimecommencingonDecember14,2010 throughandincludingDecember14,2013;except,that,if

(a) on or before March 15, 2013, GEE fails to provide evidence, in form and substance satisfactory to WFBC, in its sole discretion, of the dismissal with prejudice of GEE as a defendant from that certain lawsuit no. 3:12- cv-00850-R filed on December 21, 2012 with the United States District Court for the Western District of Kentucky at Louisville, styled Derby Capital,LLCandDerbyCapitalJOB,LLC,asplaintiffs,vs.TrinityHR Services,LLC,etal.,asdefendants; or

(b) on or before March 15, 2013, Customer fails to furnish WFBC with its Audited fiscal year end financial statements for Customer's fiscal year ended September 30, 2012 or if the results of operations of Customer at September 30, 2012 and for the fiscal year then ended, as presented in such Audited fiscal year end financial statements, are not satisfactory to WFBC; or

(c) at any time, background check results of any newly appointed senior officer (including, without limitation, any chairman of the board, president, chief executive officer, chief financial officer, chief information officer or chief restructuring officer) of Customer shall be unsatisfactory to WFBC, in its sole discretion, or if significant changes (as determined by WFBC, in its sole discretion) shall occur in the composition of the board of directors of Customer,

then, WFBC, in its sole discretion may issue a written notice to Customer establishing the last day of the Term to be sixty (60) days from the date of such written notice."

4.            EffectofthisAmendment. Except as specifically set forth herein, no other changes or modifications to the Account Purchase Agreement or the other Documents are intended or implied, and, in all other respects, the Account Purchase Agreement and the other Documents shall continue to remain in full force and effect in accordance with their respective terms as of the date hereof. This Amendment, and the instruments  and agreements delivered pursuant hereto and thereto constitute the entire agreement of the parties with respect to the subject matter hereof and thereof, and supersede all prior oral or written communications,  memoranda, proposals,  negotiations, discussions,  term sheets and commitments  with respect to the subject matter hereof and thereof.  To the extent of any conflict between any term of this Amendment and any term of the Account Purchase Agreement or any other Document, the term of this Amendment shall control.  Except as specifically set forth herein, nothing contained herein shall evidence a waiver or amendment by WFBC of any other provision of the Account Purchase Agreement or the Documents.

5.            FurtherAssurances. Customer shall execute and deliver such additional documents and take such additional  action as may be reasonably requested by WFBC to effectuate the provisions and purposes of this Amendment.

6.            BindingEffect. This Amendment shall be binding upon and inure to the benefit of each of the parties hereto and their respective successors and assigns.

7.            GoverningLaw.  The rights and obligations hereunder of each of the parties hereto shall be governed by and interpreted and determined in accordance with the internal laws of the State of Texas (without giving effect to principles of conflict of laws).

2

8.          Counterparts.  This Amendment may be signed in counterparts,  each of which shall be an original and all of which taken together constitute one agreement. In making proof of this Amendment, it shall not be necessary to produce or account for more than one counterpart signed by the party to be charged. Delivery of an executed counterpart of this Amendment electronically  or by facsimile  shall be effective as delivery of an original executed counterpart of this Amendment.

[Signature page follows]

3

Each of the parties has signed  this Amendment  as of the day and year first above written.

TRIAD PERSONNEL SERVICES, INC.
By:	/s/
Title	CEO

GENERAL EMPLOYMENT ENTERPRISES, INC.
By:	/s/
Title	CEO

BMPS, INC.
By:	/s/
Title

BMCH, INC., d/b/a Triad Temporaries
By:	/s/
Title	CEO

BMCHPA, INC., d/b/a Triad Temporaries
By:	/s/
Title	CEO

4

WELLS FARGO BANK, NATIONAL ASSOCIATION
By:	/s/ Jason M. Cole
Title	Authorized Signatory

By their signatures below, each of the validity guarantors, Salvatore J.Zizza, Herbert F. Imhoff, Jr.and Jarret A.Misch (collectively, the "ValidityGuarantors") consent to the terms of this Fifth Amendment to Account  Purchase Agreement, confirm that their respective Validity Guaranty is in full force and effect and is binding upon them without any defense, setoffs or counterclaims.

Acknowledged and agreed to by the Validity Guarantors:

By:
	SALVATORE J. ZIZZA, individually

By:	/s/ Herbert F. Imhoff
	HERBERT F. IMHOFF, individually

By:	/s/ Jarett A. Misch
	JARETT A. MISCH, individually

5

STATE OF	Illinois	)
		) ss.:
COUNTY OF	Du Page	)

On this 11th day of January, 2013, before me personally came Michael K Schroerins, to me known, who being by me duly sworn, did depose and say that he is the CEO of TRIAD PERSONNEL SERVICES, INC., the corporation described herein and which executed the foregoing instrument, and that he is authorized to execute said instrument on behalf of said corporation.

/s/ Marlene E Justus

Notary Public

STATE OF	Illinois	)
		) ss.:
COUNTY OF	Du Page	)

On this 11th day of January, 2013, before me personally came Michael K Schroerins, to me known, who being by me duly sworn, did depose and say that he is the CEO of GENERAL EMPLOYMENT ENTERPRISES, INC., the corporation described herein and which executed the foregoing instrument, and that he is authorized to execute said instrument on behalf of said corporation.

/s/ Marlene E Justus

Notary Public

STATE OF	Illinois	)
		) ss.:
COUNTY OF	Du Page	)

On this 11th day of January, 2013, before me personally came Michael K Schroerins, to me known, who being by me duly sworn, did depose and say that he is the CEO of BMPS INC., the corporation described herein and which executed the foregoing instrument, and that he is authorized to execute said instrument on behalf of said corporation.

/s/ Marlene E Justus

Notary Public

6

STATE OF	Illinois	)
		) ss.:
COUNTY OF	Du Page	)

On this 11th day of January, 2013, before me personally came Michael K Schroerins, to me known, who being by me duly sworn, did depose and say that he is the CEO of  BMCH, INC., d/b/a TRIAD TEMPORARIES, the corporation described herein and which executed the foregoing instrument, and that he is authorized to execute said instrument on behalf of said corporation.

/s/ Marlene E Justus

Notary Public

STATE OF	Illinois	)
		) ss.:
COUNTY OF	Du Page	)

On this 11th day of January, 2013, before me personally came Michael K Schroerins, to me known, who being by me duly sworn, did depose and say that he is the CEO of BMCHPA, INC., d/b/a TRIAD TEMPORARIES, the corporation described herein and which executed the foregoing instrument, and that he is authorized to execute said instrument on behalf of said corporation.

/s/ Marlene E Justus

Notary Public

7

STATE OF	)
	)  ss.:
COUNTY OF	)

On this ______ day of __________________, 2013, before me personally came SALVATORE J. ZIZZA to me known and known to me to be the individual described in and who executed the foregoing instrument and acknowledged to be that he/she executed same.

Notary Public

STATE OF Illinois	)
	) ss.:
COUNTY OF Du Page	)

On this 11th day of January 2013, before me personally came HERBERT F. IMHOFF to me known and known to me to the individual described in and who executed the foregoing instrument and acknowledged to be that he/she executed same.

/s/ Marlene E. Justus

Notary Public

STATE OF Illinois	)
	) ss.:
COUNTY OF Du Page	)

On this 11th day of January 2013, before me personally came JARETT A. MISCH to me known and known to me to the individual described in and who executed the foregoing instrument and acknowledged to be that he/she executed same.

/s/ Marlene E. Justus

Notary Public

8

AFFIDAVIT OF OUT-OF-STATE DELIVERY

STATE OF	)
	) ss.:
COUNTY OF	)

BEFORE ME, the undersigned authority, personally appeared the undersigned Jason M. Cole (the "Affiant"), who being first duty sworn upon oath, deposes and says that:

1.        The Affiant Is a Senior Vice President of Wells Fargo Bank, National Association ("WFB"), and the Affiant is duly authorized to and does make this affidavit In said capacity on behalf of WFB.

2.         That on the date sworn to and subscribed below, I executed on behalf of WFB on the date referenced below that certain Fifth Amendment to Account Purchase Agreement (the "Agreement"), which Agreement is between Triad Personnel Services, Inc., an Illinois corporation, General Employment Enterprises, Inc., an Illinois corporation and BMPS, Inc., an Ohio corporation (collectively "TRIAD"), BMCH, Inc. d/b/a Triad Personnel Services, an Ohio corporation ("BMCHOH") and BMCHPA, Inc. d/b/a Triad  Temporaries, a Pennsylvania corporation  ("BMCHPA")  (collectively  "Customer")  as Customer, and Wells Fargo Bank, National Association.

3.         That the execution of the Agreement by WFB took place in Dallas, Texas.

FURTHER AFFIANT SAYETH NAUGHT.

/s/ Jason M. Cole

Jason M. Cole, Senior Vice President

SWORN TO AND SUBSCRIBED before me this 4th day of February,2013by Jason M. Cole, who personally appeared before me, and who is personally known to me.

	/s/ Shelly Scott
	[NOTARIAL SEAL]
	Notary Public, State of Texas

Print Name: Shelly Scott

My Commission Expires: 3-15-15

9

EX-10.37

EXHIBIT 10.37

SIXTH AMENDMENT TO ACCOUNT PURCHASE AGREEMENT

AND OTHER DOCUMENTS

This SIXTH AMENDMENT TO ACCOUNT PURCHASE AGREEMENT (this “Amendment”) is entered into as of March 15, 2013 by and among TRIAD PERSONNEL SERVICES, INC., an Illinois corporation (“Personnel”), GENERAL EMPLOYMENT ENTERPRISES, INC., an Illinois corporation (“GEE”), BMPS, INC., an Ohio corporation (“BMPS”; and together with Personnel and GEE, collectively, “Triad”), BMCH, Inc., d/b/a Triad Temporaries, an Ohio corporation (“BMCHOH”) and BMCHPA, INC., d/b/a Triad Temporaries, a Pennsylvania corporation (“BMCHPA”; and together with BMCHOH and Triad, collectively, the “Customer”), and WELLS FARGO BANK, NATIONAL ASSOCIATION, acting through its WELLS FARGO BUSINESS CREDIT operating division (“WFB” or “WFBC”).

WHEREAS, Customer and WFBC have entered into certain accounts purchase arrangements pursuant to that certain Account Purchase Agreement, dated as of December 14, 2010 (as amended, restated, renewed, extended, supplemented, substituted and otherwise modified from time to time, the “Account Purchase Agreement”), between Customer and WFBC, and certain other instruments, agreements and documents executed and/or delivered in connection therewith (all such instruments, agreements and documents, as amended, restated, renewed, extended, supplemented, substituted and otherwise modified from time to time, together with the Account Purchase Agreement, collectively, the “Documents”);

WHEREAS, Customer has requested that WFBC agree, and WFBC has agreed, to amend and modify certain provisions of Account Purchase Agreement, subject to the terms and conditions of this Amendment.

NOW, THEREFORE, upon the mutual agreements and covenants set forth herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

1.             ­Definitions.  Capitalized terms used and not defined in this Amendment shall have the respective meanings given them in the Account Purchase Agreement.

2.             Extension of Delivery Date.  Notwithstanding anything to the contrary set forth in Section 4.03(g) of the Account Purchase Agreement, for Customer’s fiscal year ended September 30, 2012, Customer will furnish to WFBC on or before April 30, 2013 Audited fiscal year end financial statements acceptable to WFBC in its sole discretion, including, but not limited to a statement of profit and loss, statement of cash flow and a balance sheet, and satisfactory proof of payment and compliance with all federal, state and local tax requirements.  The date on which Customer must submit Audited fiscal year end financial statements for each of Customer’s fiscal years ending after September 30, 2012 shall be as provided in Section 4.03(g) of the Accounts Purchase Agreement.

3.             Amendment to Account Purchase Agreement.

(a)           Definitions.  The definition of “Term” appearing in Section 2.18 of the Account Purchase Agreement is hereby amended and restated in its entirety to read as follows:

“2.18 “Term” shall mean the period of time commencing on December 14, 2010 through and including December 31, 2013; except, that, if

(a) on or before April 30, , 2013, GEE fails to provide evidence, in form and substance satisfactory to WFBC, in its sole discretion, of the dismissal with prejudice of GEE as a defendant from that certain lawsuit no. 3:12-cv-00850-R filed on December 21, 2012 with the United States District Court for the Western District of Kentucky at Louisville, styled Derby Capital, LLC and Derby Capital JOB, LLC, as plaintiffs, vs. Trinity HR Services, LLC, et al., as defendants; or

(b) on or before April 30, 2013, Customer fails to furnish WFBC with its Audited fiscal year end financial statements for Customer’s fiscal year ended September 30, 2012 or if the results of operations of Customer at September 30, 2012 and for the fiscal year then ended, as presented in such Audited fiscal year end financial statements, are not satisfactory to WFBC; or

(c) at any time, background check results of any newly appointed senior officer (including, without limitation, any chairman of the board, president, chief executive officer, chief financial officer, chief information officer or chief restructuring officer) of Customer shall be unsatisfactory to WFBC, in its sole discretion, or if significant changes (as determined by WFBC, in its sole discretion) shall occur in the composition of the board of directors of Customer,

then, WFBC, in its sole discretion may issue a written notice to Customer establishing the last day of the Term to be sixty (60) days from the date of such written notice.”

4.             Effect of this Amendment.  Except as specifically set forth herein, no other changes or modifications to the Account Purchase Agreement or the other Documents are intended or implied, and, in all other respects, the Account Purchase Agreement and the other Documents shall continue to remain in full force and effect in accordance with their respective terms as of the date hereof. This Amendment, and the instruments and agreements delivered pursuant hereto and thereto constitute the entire agreement of the parties with respect to the subject matter hereof and thereof, and supersede all prior oral or written communications, memoranda, proposals, negotiations, discussions, term sheets and commitments with respect to the subject matter hereof and thereof.  To the extent of any conflict between any term of this Amendment and any term of the Account Purchase Agreement or any other Document, the term of this Amendment shall control.  Except as specifically set forth herein, nothing contained herein shall evidence a waiver or amendment by WFBC of any other provision of the Account Purchase Agreement or the Documents.

5.             ­Further Assurances.  Customer shall execute and deliver such additional documents and take such additional action as may be reasonably requested by WFBC to effectuate the provisions and purposes of this Amendment.

6.             ­Binding Effect.  This Amendment shall be binding upon and inure to the benefit of each of the parties hereto and their respective successors and assigns.

7.             Governing Law.  The rights and obligations hereunder of each of the parties hereto shall be governed by and interpreted and determined in accordance with the internal laws of the State of Texas (without giving effect to principles of conflict of laws).

2

8.             Counterparts.  This Amendment may be signed in counterparts, each of which shall be an original and all of which taken together constitute one agreement. In making proof of this Amendment, it shall not be necessary to produce or account for more than one counterpart signed by the party to be charged. Delivery of an executed counterpart of this Amendment electronically or by facsimile shall be effective as delivery of an original executed counterpart of this Amendment.

[Signature page follows]

3

Each of the parties has signed this Amendment as of the day and year first above written.

TRIAD PERSONNEL SERVICES, INC.

By:

Title:

GENERAL EMPLOYMENT ENTERPRISES, INC.

By:

Title:

BMPS, INC.

By:

Title:

BMCH, INC., d/b/a Triad Temporaries

By:

Title:

BMCHPA, INC., d/b/a Triad Temporaries

By:

Title:

4

WELLS FARGO BANK, NATIONAL ASSOCIATION
By:
Title:	Authorized Signatory

By his signature below, Michael Schroering (the “Validity Guarantor”) consents to the terms of this Sixth Amendment to Account Purchase Agreement, confirms that his Validity Guaranty is in full force and effect and is binding upon him without any defense, setoffs or counterclaims.

Acknowledged and agreed to

by the Validity Guarantor:

By:
	MICHAEL SCHROERING, individually

5

STATE OF )

)  ss.:

COUNTY OF )

On this _____ day of March, 2013, before me personally came _____________________________, to me known, who being by me duly sworn, did depose and say that he is the __________________ of TRIAD PERSONNEL SERVICES, INC., the corporation described herein and which executed the foregoing instrument, and that he is authorized to execute said instrument on behalf of said corporation.

Notary Public

STATE OF )

)  ss.:

COUNTY OF )

On this _____ day of March, 2013, before me personally came _____________________________, to me known, who being by me duly sworn, did depose and say that he is the __________________ of GENERAL EMPLOYMENT ENTERPRISES, INC., the corporation described herein and which executed the foregoing instrument, and that he is authorized to execute said instrument on behalf of said corporation.

Notary Public

STATE OF )

)  ss.:

COUNTY OF )

On this _____ day of ______________, 2013, before me personally came _____________________________, to me known, who being by me duly sworn, did depose and say that he is the __________________ of BMPS, INC., the corporation described herein and which executed the foregoing instrument, and that he is authorized to execute said instrument on behalf of said corporation.

Notary Public

6

STATE OF )

)  ss.:

COUNTY OF )

On this _____ day of March, 2013, before me personally came _____________________________, to me known, who being by me duly sworn, did depose and say that he is the __________________ of BMCH, INC., d/b/a TRIAD TEMPORARIES, the corporation described herein and which executed the foregoing instrument, and that he is authorized to execute said instrument on behalf of said corporation.

Notary Public

STATE OF )

)  ss.:

COUNTY OF )

On this _____ day of March, 2013, before me personally came _____________________________, to me known, who being by me duly sworn, did depose and say that he is the __________________ of BMCHPA, INC., d/b/a TRIAD TEMPORARIES, the corporation described herein and which executed the foregoing instrument, and that he is authorized to execute said instrument on behalf of said corporation.

Notary Public

7

STATE OF )

)  ss.:

COUNTY OF )

On this _____ day of March, 2013, before me personally came MICHAEL SCHROERING to me known and known to me to be the individual described in and who executed the foregoing instrument and acknowledged to be that he/she executed same.

Notary Public

8

AFFIDAVIT OF OUT-OF-STATE DELIVERY

STATE OF TEXAS )

)  ss.:

COUNTY OF DALLAS )

BEFORE ME, the undersigned authority, personally appeared the undersigned Jason M. Cole (the “Affiant”), who being first duty sworn upon oath, deposes and says that:

1.             The Affiant Is a Senior Vice President of Wells Fargo Bank, National Association (“WFB”), and the Affiant is duly authorized to and does make this affidavit In said capacity on behalf of WFB.

2.             That on the date sworn to and subscribed below, I executed on behalf of WFB on the date referenced below that certain Fifth Amendment to Account Purchase Agreement (the “Agreement”), which Agreement is between Triad Personnel Services, Inc., an Illinois corporation, General Employment Enterprises, Inc., an Illinois corporation and BMPS, Inc., an Ohio corporation (collectively “TRIAD”), BMCH, Inc. d/b/a Triad Personnel Services, an Ohio corporation (“BMCHOH”) and BMCHPA, Inc. d/b/a Triad Temporaries, a Pennsylvania corporation (“BMCHPA”) (collectively “Customer”) as Customer, and Wells Fargo Bank, National Association.

3.             That the execution of the Agreement by WFB took place in Dallas, Texas.

FURTHER AFFIANT SAYETH NAUGHT.

Jason M. Cole, Senior Vice President

SWORN TO AND SUBSCRIBED before me this ______ day of March, 2013 by Jason M. Cole, who personally appeared before me, and who is personally known to me.

[NOTARIAL SEAL]

Notary Public, State of Texas

Print Name:

My Commission Expires:

9

EX-23.01

EXHIBIT 23.01

Consent of Independent Registered Public Accounting Firm

We hereby consent to the incorporation by reference in the Registration Statement on Form S-8 (NoNos. 333-166173, 033-46124, 333-25129, and 333-78879) of General Employment Enterprises, Inc. (“GEE”) of our report dated March 29, 2013, relating to the consolidated financial statements of  GEE, which appears in the Form 10-K of GEE for the years ended September 30, 2012 and 2011.

/s/ FRIEDMAN LLP

New York, New York

March 29, 2013

EX-31.01

EXHIBIT 31.01

CERTIFICATION

I, Michael Schroering, certify that:

1. I have reviewed this Form 10-K annual report for the fiscal year ended September 30, 2012 of General Employment Enterprises, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: 3/29/2013	/s/ Michael Schroering
	Michael Schroering
	Chief Executive Officer
	(Principal executive officer)

EX-31.02

EXHIBIT 31.02

CERTIFICATION

I, Andrew J. Norstrud, certify that:

1. I have reviewed this Form 10-K annual report for the fiscal year ended September 30, 2012 of General Employment Enterprises, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: 3/29/2013	/s/  Andrew J. Norstrud
	Andrew J. Norstrud
	Chief Financial Officer
	(Principal financial officer)

EX-32.01

EXHIBIT 32.01

CERTIFICATIONS PURSUANT TO SECTION 1350

 OF CHAPTER 63 OF TITLE 18 OF THE UNITED STATES CODE

In connection with the Annual Report of General Employment Enterprises, Inc. (the “Company”) on Form 10-K for the fiscal year ended September 30, 2012 filed with the Securities and Exchange Commission (the “Report”), the undersigned hereby certifies, in his capacity as an officer of the Company, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to his knowledge:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of the operations of the Company.

Date: 3/29/2013	By: /s/ Michael Schroering
	Michael Schroering
	Chief Executive Officer
	(Principal executive officer)

EX-32.02

EXHIBIT 32.02

CERTIFICATIONS PURSUANT TO SECTION 1350

 OF CHAPTER 63 OF TITLE 18 OF THE UNITED STATES CODE

In connection with the Annual Report of General Employment Enterprises, Inc. (the “Company”) on Form 10-K for the fiscal year ended September 30, 2012 filed with the Securities and Exchange Commission (the “Report”), the undersigned hereby certifies, in his capacity as an officer of the Company, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to his knowledge:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of the operations of the Company.

Date: 3/29/2013	By: /s/ Andrew J. Norstrud
	Andrew J. Norstrud
	Chief Financial Officer
	(Principal financial officer)

XML

Short-term Debt (Details) (USD $)	3 Months Ended	12 Months Ended
	Dec. 31, 2010	Sep. 30, 2012	Sep. 30, 2011
Line of Credit Facility [Line Items]
Interest expense under line of credit		$ 204,000	$ 198,000
Short-term debt		2,404,000	1,938,000
Crestmark Bank [Member]
Line of Credit Facility [Line Items]
Maximum percentages of credit facility provides for borrowings on revolving basis (in hundredths)	85.00%
Maximum borrowing capacity under the agreement	3,500,000
Interest rate of credit facility (in hundredths)	1.00%
Variable rate of debt instrument basis	prime rate
Interest expense under line of credit			4,500
Monthly maintenance fee of loan	3,500
Annual loan fees (in hundredths)	1.00%
Agreement fees			29,000
Wells Fargo [Member]
Line of Credit Facility [Line Items]
Maximum percentages of credit facility provides for borrowings on revolving basis (in hundredths)	85.00%
Maximum borrowing capacity under the agreement	3,000,000
Variable rate of debt instrument basis	LIBOR
Variable rate of debt instrument basis rate (in hundredths)	5.25%
Interest expense under line of credit		176,000	79,000
Purchase agreement period	2 years
Maximum period for eligible accounts receivable	90 days
Effective interest rate of debt instrument (in hundredths)		5.65%	5.75%
Minimum period of credit facility		60 days
Remaining borrowing capacity availability under this agreement		596,000
Short-term debt		$ 2,404,000

XML

Segment Data (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Sep. 30, 2012	Sep. 30, 2011
Segment Reporting Information [Line Items]
Revenue	$ 52,405	$ 37,189
Operating income (loss)	(807)	556
Depreciation and amortization	546	713
Accounts receivable - net	6,761	6,604
Intangible assets	2,204	2,699
Goodwill	1,106	1,280
Total assets	11,199	11,496
Direct Hire Placement Services [Member]
Segment Reporting Information [Line Items]
Revenue	7,215	4,430
Gross margin (in hundredths)	100.00%	100.00%
Operating income (loss)	(1,701)	(678)
Depreciation and amortization	237	180
Accounts receivable - net	980	699
Intangible assets	465	584
Goodwill	24	24
Total assets	3,334	5,301
Management Services [Member]
Segment Reporting Information [Line Items]
Revenue	0	838
Operating income (loss)	0	519
Accounts receivable - net	0	225
Total assets	0	225
Contract Staffing Services [Member]
Segment Reporting Information [Line Items]
Operating income (loss)	894	715
Depreciation and amortization	309	533
Intangible assets	1,739	2,115
Goodwill	1,083	1,256
Total assets	7,865	5,970
Contract Staffing Services [Member] | Agricultural services [Member]
Segment Reporting Information [Line Items]
Revenue	7,852	12,412
Gross margin (in hundredths)	4.41%	4.60%
Accounts receivable - net	597	666
Contract Staffing Services [Member] | Industrial services [Member]
Segment Reporting Information [Line Items]
Revenue	28,206	12,349
Gross margin (in hundredths)	17.15%	14.60%
Accounts receivable - net	4,056	3,837
Contract Staffing Services [Member] | Professional services [Member]
Segment Reporting Information [Line Items]
Revenue	9,132	7,160
Gross margin (in hundredths)	19.38%	29.90%
Accounts receivable - net	$ 1,128	$ 1,177

XML

Significant Accounting Policies and Estimates (Details) (USD $)	12 Months Ended
	Sep. 30, 2012 Segment	Sep. 30, 2011
Cash Equivalents [Abstract]
Maximum maturity period of highly liquid investments considered as cash equivalents	3 months
Cash equivalents carrying value	$ 0	$ 0
Change in insurance coverage limit at each financial institution	250,000
Accounts Receivable [Abstract]
Allowance for doubtful accounts	259,000	137,000
Property and Equipment [Abstract]
Useful life of property and equipment	5 years
Impairment of property and equipment	0
Advertising [Abstract]
Advertising costs	$ 870,000	$ 541,000
Segment Data [Abstract]
Number of operating business segments	3
Minimum [Member]
Property and Equipment [Abstract]
Useful life of property and equipment	2 years
Minimum [Member] | Customer Lists, Non Compete Agreements, Customer Relationships, Management Agreements and Trade Names [Member]
Intangible Assets [Abstract]
Estimated useful lives	2 years
Maximum [Member]
Property and Equipment [Abstract]
Useful life of property and equipment	10 years
Maximum [Member] | Customer Lists, Non Compete Agreements, Customer Relationships, Management Agreements and Trade Names [Member]
Intangible Assets [Abstract]
Estimated useful lives	10 years
Computer Equipment [Member]
Property and Equipment [Abstract]
Useful life of property and equipment	5 years
Computer Software [Member]
Property and Equipment [Abstract]
Useful life of property and equipment	5 years
Office Equipment Furniture and Fixtures [Member] | Minimum [Member]
Property and Equipment [Abstract]
Useful life of property and equipment	2 years
Office Equipment Furniture and Fixtures [Member] | Maximum [Member]
Property and Equipment [Abstract]
Useful life of property and equipment	10 years
Stock Options [Member]
Income or Loss Per Share [Abstract]
Number of shares excluded from earnings (loss) per share calculation (in shares)	589,000	254,000

XML

Acquisitions (Tables)

12 Months Ended

Sep. 30, 2012

Ashley Ellis, LLC [Member]

Business Acquisition [Line Items]

Schedule of total consideration

In connection with the transactions contemplated by the Ashley Ellis Asset Purchase Agreement, on August 31, 2011, the Company and Ashley Ellis entered into a registration rights agreement (the "Registration Rights Agreement"), pursuant to which Ashley Ellis was granted certain piggyback registration rights with respect to the Shares to be issued to Ashley Ellis under the Ashley Ellis Asset Purchase Agreement.  The Registration Rights Agreement contains certain indemnification provisions for the benefit of the Company and Ashley Ellis and other customary provisions.  The total consideration is summarized as follows:

In Thousands
Stock consideration	$	331
Cash consideration		400
Total consideration for acquisition	$	731

Schedule of fair value of the assets acquired and liabilities assumed at the date of closing

The following table summarizes the approximate fair value of the assets acquired and liabilities assumed at the date of closing.

In Thousands
Property and Equipment	$	114
Intangible assets – trade name		17
Intangible assets – customer relationships		577
Goodwill		23
Total fair value of assets acquired	$	731

DMCC Staffing, LLC and RFFG of Cleveland, LLC [Member]

Business Acquisition [Line Items]

Schedule of total consideration

The total consideration is summarized as follows:

In Thousands
Stock consideration	$	2,400
Earn-out consideration		2,198
Total consideration for acquisition	$	4,598

Schedule of fair value of the assets acquired and liabilities assumed at the date of closing

The following table summarizes the approximate fair value of the assets acquired and liabilities assumed at the date of closing.

In Thousands
Property and equipment	$	5
Intangible assets - management agreement		1,396
Intangible assets - customer relationships		2,113
Goodwill		1,084
Total fair value of assets acquired	$	4,598

XML

Common Stock (Details)	1 Months Ended
	Sep. 30, 2011 Ashley Ellis, LLC [Member]	Nov. 30, 2010 DMCC Staffing, LLC and RFFG of Cleveland, LLC [Member]
Class Of Stock [Line Items]
Common stock issued in connection with the acquisition (in shares)	1,250,000	5,581,395

XML

Property and Equipment (Details) (USD $)	12 Months Ended
	Sep. 30, 2012	Sep. 30, 2011
Summary of property and equipment [Abstract]
Useful life of property and equipment	5 years
Total property and equipment, at cost	$ 3,758,000	$ 3,513,000
Accumulated depreciation and amortization	(3,240,000)	(3,104,000)
Property and equipment, net	518,000	409,000
Disposals of property and equipment	16,000	24,000
Depreciation expense	152,000	176,000
Maximum [Member]
Summary of property and equipment [Abstract]
Useful life of property and equipment	10 years
Minimum [Member]
Summary of property and equipment [Abstract]
Useful life of property and equipment	2 years
Computer software [Member]
Summary of property and equipment [Abstract]
Useful life of property and equipment	5 years
Total property and equipment, at cost	1,447,000	1,447,000
Office equipment furniture and fixtures and leasehold improvements [Member]
Summary of property and equipment [Abstract]
Total property and equipment, at cost	$ 2,311,000	$ 2,066,000

XML

Significant Accounting Policies and Estimates

12 Months Ended

Sep. 30, 2012

Significant Accounting Policies and Estimates [Abstract]

Significant Accounting Policies and Estimates

2. Significant Accounting Policies and Estimates

The consolidated financial statements are prepared in conformity with accounting principles generally accepted in the United States of America and the rules of the United States Securities and Exchange Commission.

Principles of Consolidation

The consolidated financial statements include the accounts and transactions of the Company and its wholly-owned subsidiaries.  All significant inter-company accounts and transactions are eliminated in consolidation.

Estimates and Assumptions

Management makes estimates and assumptions that can affect the amounts of assets and liabilities reported as of the date of the financial statements, as well as the amounts of reported revenues and expenses during the periods presented.  Those estimates and assumptions typically involve expectations about events to occur subsequent to the balance sheet date, and it is possible that actual results could ultimately differ from the estimates.  If differences were to occur in a subsequent period, the Company would recognize those differences when they became known.  Significant matters requiring the use of estimates and assumptions include, but may not be limited to, deferred income tax valuation allowances, accounts receivable allowances, accounting for acquisitions, and evaluation of impairment.  Management believes that its estimates and assumptions are reasonable, based on information that is available at the time they are made.

Revenue Recognition

Direct hire placement service revenues are recognized when applicants accept offers of employment, less a provision for estimated losses due to applicants not remaining employed for the Company's guarantee period.  Contract staffing service revenues are recognized when services are rendered.

Cost of Contract Staffing Services

The cost of contract services includes the wages and the related payroll taxes and employee benefits of the Company's employees while they work on contract assignments.

Income Taxes

We record a provision for income taxes for the anticipated tax consequences of the reported results of operations using the asset and liability method. Under this method, we recognize deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the financial reporting and tax basis of assets and liabilities, as well as for operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using the tax rates that are expected to apply to taxable income for the years in which those tax assets and liabilities are expected to be realized or settled. We record a valuation allowance to reduce our deferred tax assets to the net amount that we believe is more likely than not to be realized.

We recognize tax benefits from uncertain tax positions only if we believe that it is more likely than not that the tax position will be sustained on examination by the taxing authorities based on the technical merits of the position. Although we believe that we have adequately reserved for our uncertain tax positions, we can provide no assurance that the final tax outcome of these matters will not be materially different. We make adjustments to these reserves when facts and circumstances change, such as the closing of a tax audit or the refinement of an estimate. To the extent that the final tax outcome of these matters is different than the amounts recorded, such differences will affect the provision for income taxes in the period in which such determination is made and could have a material impact on our financial condition and operating results. The provision for income taxes includes the effects of any accruals that we believe are appropriate, as well as the related net interest and penalties.

 Income or Loss per Share

Basic income or loss per share is based on the average number of common shares outstanding.  Diluted income per share is based on the average number of common shares and the dilutive effect of stock options.  Stock options are not considered to be dilutive during loss periods.  The diluted net loss per share in fiscal 2012 excludes approximately 589,000 stock options as they had an anti-dilutive effect.  The diluted net income per share includes the effect of 254,000 stock options in fiscal 2011.

Cash and Cash Equivalents

Highly liquid investments with a maturity of three months or less when purchased are considered to be cash equivalents.  At September 2012 and 2011, there were no cash equivalents.  The Company maintains deposits in financial institutions in excess of amounts guaranteed by the Federal Deposit Insurance Corporation.  Cash and cash equivalents are maintained at financial institutions and, at times, balances may exceed federally insured limits. We have never experienced any losses related to these balances. All of our non-interest bearing cash balances were fully insured at September 30, 2012 due to a temporary federal program in effect from December 31, 2010 through December 31, 2012. Under the program, there is no limit to the amount of insurance for eligible accounts. Beginning 2013, insurance coverage will revert to $250,000 per depositor at each financial institution, and our non-interest bearing cash balances may again exceed federally insured limits.

Accounts Receivable

The Company extends credit to its various customers based on evaluation of the customer's financial condition and ability to pay the Company in accordance with the payment terms. An allowance for placement falloffs is recorded, as a reduction of revenues, for estimated losses due to applicants not remaining employed for the Company's guarantee period.  An allowance for doubtful accounts is recorded, as a charge to bad debt expense, where collection is considered to be doubtful due to credit issues.  These allowances together reflect management's estimate of the potential losses inherent in the accounts receivable balances, based on historical loss statistics and known factors impacting its customers.  The nature of the contract service business, where companies are dependent on employees for the production cycle allows for a small accounts receivable allowance.  Based on management's review of accounts receivable, an allowance for doubtful accounts of approximately $259,000 and $137,000 is considered necessary as of September 30, 2012 and September 30, 2011, respectively.  The Company charges uncollectible accounts against the allowance once the invoices are deemed unlikely to be collectible.  The Company does not accrue interest on past due receivables.

Property and Equipment

Property and equipment are recorded at cost.  Depreciation expense is calculated on a straight-line basis over estimated useful lives of five years for computer equipment and two to ten years for office equipment, furniture and fixtures.  The Company capitalizes computer software purchased or developed for internal use and amortizes it over an estimated useful life of five years.  The carrying value of property and equipment is reviewed for impairment whenever events or changes in circumstances indicate that it may not be recoverable.  If the carrying amount of an asset group is greater than its estimated future undiscounted cash flows, the carrying value is written down to the estimated fair value.  There was no impairment of property and equipment for the years ended September 30, 2012 and September 30, 2011.

Goodwill

Goodwill represents the excess of cost over the fair value of the net assets acquired in the June 1, 2010 acquisition of On-Site Services, Inc., the November 1, 2010 purchase of DMCC Staffing, LLC and RFFG of Cleveland, LLC and the Ashley Ellis, LLC acquisition on September 1, 2011.  The Company assesses goodwill for impairment at least annually.  The Company early adopted, Intangibles – Goodwill and Other (Topic 350): Testing Goodwill for Impairment, which allows the Company to first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If the entity determines that this threshold is not met, then performing the two-step impairment test is unnecessary.  An impairment loss would be recognized to the extent the carrying value of goodwill exceeds its implied fair value.

Fair Value Measurement

The Company follows the provisions of the accounting standard which defines fair value, establishes a framework for measuring fair value and enhances fair value measurement disclosure. Under these provisions, fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (i.e., the "exit price") in an orderly transaction between market participants at the measurement date.

The standard establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use on unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company's assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The hierarchy is described below:

Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs.

Level 2: Observable prices that are based on inputs not quoted on active markets, but corroborated by market data.

Level 3: Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs.

The fair value of the Company's current assets and current liabilities approximately their carrying values due to their short term nature.  The carrying value of the Company's long-term liabilities represents their fair value based on level 3 inputs further disclosed in note 11.  The Company's goodwill and other intangible assets are measured at fair value on a non-recurring basis using level 3 inputs, as further disclosed in Notes 4,5 and 8.

Intangible Assets

Customer lists, non-compete agreements, customer relationships, management agreements and trade names were recorded at their estimated fair value at the date of acquisition and are amortized over their estimated useful lives ranging from two to ten years using both accelerated and straight-line methods.

Impairment of Long-lived Assets

The Company records an impairment of long-lived assets used in operations, other than goodwill, when events or circumstances indicate that the asset might be impaired and the estimated undiscounted cash flows to be generated by those assets over their remaining lives are less than the carrying amount of those items.  The net carrying value of assets not recoverable is reduced to fair value, which is typically calculated using the discounted cash flow method.

Stock-Based Compensation

Compensation expense is recorded for the fair value of stock options issued to directors and employees.  The expense is measured as the estimated fair value of the stock options on the date of grant and is recorded over the vesting periods.

Advertising

The Company expenses advertising costs as incurred.  Advertising costs were approximately $870,000 and $541,000 for the years ended September 30, 2012 and 2011, respectively.

Segment Data

The Company has three operating business segments a) Contract staffing services, b) Direct hire placement services and c) Management services.  These operating segments were determined based primarily on how the chief operating decision maker views and evaluates our operations. Operating results are regularly reviewed by the chief operating decision maker to make decisions about resources to be allocated to the segment and to assess its performance. Other factors, including type of business, type of employee, length of employment, revenue recognition are considered in determining these operating segments.  Management services are no longer in operations during the year ended September 30, 2012.

XML

Stock Option Plans (Details) (USD $)	12 Months Ended
	Sep. 30, 2012 Plan	Sep. 30, 2011	Sep. 30, 2012 Under $1.00 [Member]	Sep. 30, 2012 $1.25 to $2.39 [Member]	Sep. 30, 2012 Stock options [Member]	Sep. 30, 2012 1997 Stock Option Plan [Member]	Sep. 30, 2009 1997 Stock Option Plan [Member]	Sep. 30, 2012 2011 Company Incentive Plan [Member]
Stock Option Plans [Abstract]
Number of plans approved by shareholders	4
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock option available for grant under the plan (in shares)	1,201,000	731,000					592,000
Stock option available for issuance under the plan (in shares)						700,840		500,000
Expiration period of stock option from the date of grant					10 years
Number of options outstanding [Abstract]
Beginning of year (in shares)	301,000	388,000
Granted (in shares)	1,747,000	0
Exercised (in shares)	0	(12,000)
Terminated (in shares)	(301,000)	(75,000)
End of year (in shares)	1,747,000	301,000
Number of options exercisable at end of year (in shares)	1,658,000	255,000
Number of options available for grant at end of year (in shares)	1,201,000	731,000					592,000
Weighted average option prices per share [Abstract]
Granted during the year (in dollars per share)	$ 0.41	$ 0
Exercised during the year (in dollars per share)	$ 0	$ 0.40
Terminated during the year (in dollars per share)	$ 0	$ 1.26
Outstanding at end of year (in dollars per share)	$ 0.38	$ 0.95
Exercisable at end of year (in dollars per share)	$ 0.40	$ 1.00
Summary of stock options outstanding [Abstract]
Range of Exercise Prices ,Minimum (in dollars per share)				$ 1.25
Range of Exercise Prices ,Maximum (in dollars per share)			$ 1.00	$ 2.39
Number Outstanding (in shares)			1,747,000
Weighted Average Price (in dollars per share)			$ 0.38
Number Exercisable (in shares)			1,658,000
Weighted Average Price (in dollars per share)			$ 0.40
Average Remaining Life			4 years
Aggregate intrinsic value of outstanding stock options	$ 0.19
Aggregate intrinsic value of exercisable stock options	0.19
Intrinsic value of stock options exercised (in dollars per share)	$ 0
Estimated average fair value of stock options grant (in dollars per share)	$ 0.26
Summary of black Scholes option pricing model and weighted average assumptions [Abstract]
Expected option life	5 years
Expected stock price volatility (in hundredths)	76.00%
Expected dividend yield (in hundredths)	0.00%
Risk-free interest rate (in hundredths)	0.91%
Stock-based compensation expense	422,000	8,000
Unrecognized compensation expense related to unvested stock options outstanding	$ 46,000
Weighted average vesting period of unvested stock options	2 years 6 months

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Stock Option Plans (Tables)

12 Months Ended

Sep. 30, 2012

Stock Option Plans [Abstract]

Schedule of stock option activity

A summary of stock option activity is as follows:

	Year Ended September 30
(Number of Options in Thousands)	2012			2011
Number of options outstanding:
Beginning of year		301			388
Granted		1,747			—
Exercised		—			(12	)
Terminated		(301	)		(75	)
End of year		1,747			301
Number of options exercisable at end of year		1,658			255
Number of options available for grant at end of year		1,201			731
Weighted average option prices per share:
Granted during the year	$	.41		$	—
Exercised during the year		—			.40
Terminated during the year		—			1.26
Outstanding at end of year		.38			.95
Exercisable at end of year		.40			1.00

Schedule of stock options outstanding

Stock options outstanding as of September 30, 2012 were as follows (number of options in thousands):

Range of Exercise Prices		Number Outstanding	Weighted Average Price		Number Exercisable	Weighted Average Price		Average Remaining Life (Years)
Under $1.00		1,747	$	.38	1,658	$	.40	4
$	1.25 to $2.39

Schedule of black-Scholes option pricing model and weighted average assumptions

The average fair value of stock options granted was estimated to be $0.26 per share in fiscal 2012.  No stock options were issued in fiscal year 2011.   This estimate was made using the Black-Scholes option pricing model and the following weighted average assumptions:

	2012			2011
Expected option life (years)		5.0
Expected stock price volatility		76	%
Expected dividend yield		—	%
Risk-free interest rate		.91	%

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Other Current Liabilities (Tables)

12 Months Ended

Sep. 30, 2012

Other Current Liabilities [Abstract]

Other current liabilities

Other current liabilities consisted of the following:

	September 30th
(In Thousands)	2012		2011
Accrued expenses	$	282	$	201
Accrued rent		-		31
Second Installment of the Ashley Ellis, LLC purchase price		-		200
Contingent earn-out liability due within one year		834		803
Deferred rent		80		72
Total other current liabilities	$	1,196	$	1,307

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Income Taxes (Details) (USD $)	12 Months Ended
	Sep. 30, 2012	Sep. 30, 2011
Summary of components of the provision for income taxes [Abstract]
Current tax provision	$ 0	$ 0
Deferred tax provision (credit) related to [Abstract]
Temporary differences
Stock option Expense	74,000	2,000
Deferred compensation expense	(60,000)	(57,000)
Vacation expense	39,000	32,000
Intangible assets	94,000	(272,000)
Allowance for doubtful accounts	46,000	19,000
Other	(45,000)	(24,000)
Loss carryforwards	(194,000)	104,000
Valuation allowances	46,000	196,000
Provision for income taxes	0	0
Statutory U.S. federal income tax rate (in hundredths)	34.00%
Summary of provision for income taxes [Abstract]
Income tax provision at statutory federal tax rate	50,000	122,000
Valuation allowance	(50,000)	(122,000)
Provision for income taxes	0	0
Summary of net deferred income tax asset [Abstract]
Temporary differences
Stock option Expense	217,000	138,000
Deferred compensation expense	120,000	184,000
Vacation expense	30,000	47,000
Intangible assets	107,000	282,000
Allowance for doubtful accounts	104,000	55,000
Other	85,000	105,000
Net operating loss carryforwards	3,560,000	3,366,000
Valuation allowances	(4,223,000)	(4,177,000)
Net deferred income tax asset	0	0
Operating Loss Carryforwards [Line Items]
Valuation allowance on our net deferred tax assets decreased	131,000
Federal Tax [Member]
Operating Loss Carryforwards [Line Items]
Losses available to reduce taxable income in future years	8,900,000
State Tax [Member]
Operating Loss Carryforwards [Line Items]
Losses available to reduce taxable income in future years	$ 7,525,000

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Income Taxes (Tables)

12 Months Ended

Sep. 30, 2012

Income Taxes [Abstract]

Schedule of components of the provision for income taxes

The components of the provision for income taxes are as follows:

	Year Ending September 30,
(In Thousands)	2012			2011
Current tax provision	$	—		$	—
Deferred tax provision (credit) related to:
Temporary differences
Stock option Expense		74			2
Deferred compensation expense		(60	)		(57	)
Vacation expense		39			32
Intangible assets		94			(272	)
Allowance for doubtful accounts		46			19
Other		(45	)		(24	)
Loss carryforwards		(194	)		104
Valuation allowances		46			196
Provision for income taxes	$	—		$	—

Schedule of provision for income taxes

The differences between income taxes calculated at the 34% statutory U.S. federal income tax rate and the Company's provision for income taxes are as follows:

	Year Ended September 30,
(In Thousands)	2012			2011
Income tax provision at statutory federal tax rate	$	50		$	122
Valuation allowance		(50	)		(122	)
Provision for income taxes	$	—		$	—

Schedule of deferred income tax asset

The net deferred income tax asset balance related to the following:

	Year Ended September 30,
(In Thousands)	2012			2011
Temporary differences				$
Stock option Expense	$	217			138
Deferred compensation expense		120			184
Vacation expense		30			47
Intangible assets		107			282
Allowance for doubtful accounts		104			55
Other		85			105
Net operating loss carryforwards		3,560			3,366
Valuation allowances		(4,223	)		(4,177	)
Net deferred income tax asset	$	—		$	—

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Segment Data (Tables)

12 Months Ended

Sep. 30, 2012

Segment Data [Abstract]

Schedule of segment reporting information

	Fiscal Year Ended
	September 30
(In Thousands)	2012			2011
Direct Hire Placement Services
Revenue	$	7,215		$	4,430
Placement services gross margin		100	%		100	%
Operating loss		(1,701	)		(678	)
Depreciation & amortization		237			180
Accounts receivable – net		980			699
Intangible assets		465			584
Goodwill		24			24
Total assets		3,334			5,301
Management Services
Revenue	$	—		$	838
Operating income		—			519
Fee receivable		—			225
Total assets		—			225
Contract Staffing Services
Agricultural services revenue	$	7,852		$	12,412
Industrial services revenue		28,206			12,349
Professional services revenue		9,132			7,160
Agricultural services gross margin		4.41	%		4.6	%
Industrial services gross margin		17.15	%		14.6	%
Professional services gross margin		19.38	%		29.9	%
Operating income (loss)	$	894		$	715
Depreciation and amortization		309			533
Accounts receivable – agricultural services		597			666
Accounts receivable – industrial services		4,056			3,837
Accounts receivable – professional services		1,128			1,177
Intangible assets		1,739			2,115
Goodwill		1,083			1,256
Total assets	$	7,865		$	5,970
Consolidated
Total revenue	$	52,405		$	37,189
Operating income (loss)		(807	)		556
Depreciation and amortization		546			713
Total accounts receivables – net		6,761			6,604
Intangible assets		2,204			2,699
Goodwill		1,106			1,280
Total assets	$	11,199		$	11,496

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Description of Business

12 Months Ended

Sep. 30, 2012

Description of Business [Abstract]

Description of Business

1. Description of Business

General Employment Enterprises, Inc. (the "Company") provides staffing services through a network of branch offices located in major metropolitan areas throughout the United States.  The Company's professional staffing services provide information technology, engineering and accounting professionals to clients on either a regular placement basis or a temporary contract basis.  The Company's agricultural staffing services provide agricultural workers for farms and groves.  The Company's industrial staffing business provides weekly temporary staffing for light industrial clients in Ohio and Pennsylvania.  There was no customer that represented more than 10% of the Company's consolidated revenue in fiscal 2012, however the Company did have two large customers that represented approximately 17.4% and 11.5% of the Company's consolidated revenue in fiscal 2011.

The Company experienced significant losses for the year ended September 30, 2012.  Management has implemented a strategy which included cost reduction efforts as well as identifying strategic acquisitions, financed primarily through the issuance of stock, to improve the overall profitability and cash flows of the Company.  In December 2010, the Company entered into an account purchase agreement with Wells Fargo Business Credit to provide working capital financing.  The account purchase agreement allows Wells Fargo to advance the Company funds on accounts receivable at its sole discretion.  In the event Wells Fargo elects not to advance us funds on our accounts receivable balance or the performance of theacquired entities does not meet our expectations, the Company could experience liquidity constraints.

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Description of Business (Details)	12 Months Ended
	Sep. 30, 2012 Customer	Sep. 30, 2011 Customer
Revenue, Major Customer [Line Items]
Maximum percentage of net revenues accounted by other customer during the period (in hundredths)	10.00%
Number of customers representing more than ten percent of company's revenue	0	2
Customer One [Member]
Revenue, Major Customer [Line Items]
Percentage of total revenues accounted by largest customers, 10 percent or more (in hundredths)		17.40%
Customer Two [Member]
Revenue, Major Customer [Line Items]
Percentage of total revenues accounted by largest customers, 10 percent or more (in hundredths)		11.50%

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Other Current Liabilities (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2012	Sep. 30, 2011
Other current liabilities [Abstract]
Accrued expenses	$ 282	$ 201
Accrued rent	0	31
Second Installment of the Ashley Ellis, LLC purchase price	0	200
Contingent earn-out liability due within one year	834	803
Deferred rent	80	72
Total other current liabilities	$ 1,196	$ 1,307

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CONSOLIDATED BALANCE SHEETS (USD $) In Thousands, unless otherwise specified	Sep. 30, 2012	Sep. 30, 2011
CURRENT ASSETS:
Cash and cash equivalents	$ 364	$ 314
Accounts receivable, less allowances (2012 - $259; 2011 - $137)	6,761	6,604
Other	246	190
Total Current Assets	7,371	7,108
Property and equipment, net (2012 - $3,240; 2011 - $3,104)	518	409
Goodwill	1,106	1,280
Intangible assets, net	2,204	2,699
TOTAL ASSETS	11,199	11,496
CURRENT LIABILITIES:
Short-term debt	2,404	1,938
Accounts payable	173	485
Accrued compensation	3,068	2,391
Other current liabilities	1,196	1,307
Total Current Liabilities	6,841	6,121
Long-term liabilities	253	681
Commitments and Contingencies
SHAREHOLDERS' EQUITY
Preferred stock; authorized - 100 shares; no par value; issued and outstanding - none	0	0
Common stock, no-par value; authorized - 50,000 shares; issued and outstanding - 21,699 shares at September 30, 2012 and September 30, 2011	10,453	10,031
Accumulated deficit	(6,348)	(5,337)
Total Shareholders' Equity	4,105	4,694
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	$ 11,199	$ 11,496

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Contingencies (Details) (USD $)	12 Months Ended
	Sep. 30, 2012	Sep. 30, 2011	Mar. 31, 2012
Operating Leased Assets [Line Items]
Lien on the business			$ 229,000
Rent expense	1,028,000	617,000
Minimum initial terms of payments due under non-cancelable lease agreements	1 year
Future minimum lease payments [Abstract]
Future minimum lease payments, total	2,200,000
Future minimum lease payments on fiscal year 2013	922,000
Future minimum lease payments on fiscal year 2014	733,000
Future minimum lease payments on fiscal year 2015	424,000
Future minimum lease payments on fiscal year 2016	99,000
Future minimum lease payments on fiscal year Thereafter	$ 22,000
Minimum [Member]
Operating Leased Assets [Line Items]
Leased period of branch offices	3 years
Maximum [Member]
Operating Leased Assets [Line Items]
Leased period of branch offices	5 years

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CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Sep. 30, 2012	Sep. 30, 2011
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income (loss)	$ (1,011)	$ 358
Adjustments to reconcile net income (loss) to net cash and cash equivalents provided by (used in) operating activities:
Depreciation and amortization	546	713
Reduction of earn-out liability	0	(1,276)
Loss on impairment of goodwill	173
Loss on impairment of other intangible assets	101	1,126
Stock compensation expense	422	8
Non cash interest expense	0	120
Provision for doubtful accounts	491	66
Changes in assets and liabilities -
Accounts receivable	(648)	(5,250)
Accounts payable	(312)	378
Accrued compensation	677	1,622
Other current items, net	(164)	398
Long-term liabilities	(180)	(553)
Net cash provided by (used by) operating activities	95	(2,290)
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of property and equipment	(261)	(84)
Partial payment of earn-out	(50)	0
Acquisition of Ashley Ellis	(200)	(200)
Net cash used in investing activities	(511)	(284)
CASH FLOWS FROM FINANCING ACTIVITIES:
Exercise of stock options	0	5
Net proceeds from short-term debt	466	1,938
Net cash provided by financing activities	466	1,943
Net increase (decrease) in cash and cash equivalents	50	(631)
Cash and cash equivalents at beginning of year	314	945
Cash and cash equivalents at end of year	364	314
SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid for interest	182	66
Cash paid for taxes	$ 0	$ 0

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Entry into Management Service Agreement (Details) (USD $)	12 Months Ended
	Sep. 30, 2012	Sep. 30, 2011
Related Party Transaction [Line Items]
Management services revenue	$ 0	$ 838,000
Loss on impairment of intangible assets	101,000	1,126,000
Reduction of earn out liability	0	1,276,000
Unpaid management fee		140,000
BMP [Member]
Related Party Transaction [Line Items]
Percentage of gross revenue that RFFG agreed to pay as per agreement (in hundredths)	6.00%
Management services revenue		838,000
Management fee receivable		$ 225,000
Tom Bean [Member]
Related Party Transaction [Line Items]
Ownership percentage (in hundredths)	10.00%

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Contingencies

12 Months Ended

Sep. 30, 2012

Leases [Abstract]

Leases

15. Contingencies and Commitments

In March 2012, the Company became aware of a lien on the business by the Ohio Bureau of Workers Compensation for $229,000, which has been fully accrued for.  The Company believes this claim represents unpaid workers compensation premium for a period prior to the acquisition of certain assets of RFFG of Cleveland in November 2010.  The Company is currently defending its position in this matter.

Lease

The Company leases space for all of its branch offices, which are located either in downtown or suburban business centers, and for its corporate headquarters.  Branch offices are generally leased over periods from three to five years.  The corporate office lease expires in 2015.  The leases generally provide for payment of basic rent plus a share of building real estate taxes, maintenance costs and utilities.

Rent expense was $ 1,028,000 in fiscal 2012 and $617,000 in fiscal 2011.  As of September 30, 2012, future minimum lease payments due under non-cancelable lease agreements having initial terms in excess of one year, including certain closed offices, totaled approximately $2,200,000, as follows: fiscal 2013 - $922,000, fiscal 2014 - $733,000, fiscal 2015 - $424,000, fiscal 2016 - $99,000 and thereafter - 22,000.

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Placement Service Revenues (Details) (USD $)	12 Months Ended
	Sep. 30, 2012	Sep. 30, 2011
Placement Service Revenues [Abstract]
Provision for falloffs and refunds in connection with placement service revenue	$ 1,026,000	$ 695,000

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Significant Accounting Policies and Estimates (Policies)

12 Months Ended

Sep. 30, 2012

Significant Accounting Policies and Estimates [Abstract]

Principles of Consolidation

Principles of Consolidation

The consolidated financial statements include the accounts and transactions of the Company and its wholly-owned subsidiaries.  All significant inter-company accounts and transactions are eliminated in consolidation.

Estimates and Assumptions

Estimates and Assumptions

Management makes estimates and assumptions that can affect the amounts of assets and liabilities reported as of the date of the financial statements, as well as the amounts of reported revenues and expenses during the periods presented.  Those estimates and assumptions typically involve expectations about events to occur subsequent to the balance sheet date, and it is possible that actual results could ultimately differ from the estimates.  If differences were to occur in a subsequent period, the Company would recognize those differences when they became known.  Significant matters requiring the use of estimates and assumptions include, but may not be limited to, deferred income tax valuation allowances, accounts receivable allowances, accounting for acquisitions, and evaluation of impairment.  Management believes that its estimates and assumptions are reasonable, based on information that is available at the time they are made.

Revenue Recognition

Revenue Recognition

Direct hire placement service revenues are recognized when applicants accept offers of employment, less a provision for estimated losses due to applicants not remaining employed for the Company's guarantee period.  Contract staffing service revenues are recognized when services are rendered.

Cost of Contract Staffing Services

Cost of Contract Staffing Services

The cost of contract services includes the wages and the related payroll taxes and employee benefits of the Company's employees while they work on contract assignments.

Income Taxes

Income Taxes

We record a provision for income taxes for the anticipated tax consequences of the reported results of operations using the asset and liability method. Under this method, we recognize deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the financial reporting and tax basis of assets and liabilities, as well as for operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using the tax rates that are expected to apply to taxable income for the years in which those tax assets and liabilities are expected to be realized or settled. We record a valuation allowance to reduce our deferred tax assets to the net amount that we believe is more likely than not to be realized.

We recognize tax benefits from uncertain tax positions only if we believe that it is more likely than not that the tax position will be sustained on examination by the taxing authorities based on the technical merits of the position. Although we believe that we have adequately reserved for our uncertain tax positions, we can provide no assurance that the final tax outcome of these matters will not be materially different. We make adjustments to these reserves when facts and circumstances change, such as the closing of a tax audit or the refinement of an estimate. To the extent that the final tax outcome of these matters is different than the amounts recorded, such differences will affect the provision for income taxes in the period in which such determination is made and could have a material impact on our financial condition and operating results. The provision for income taxes includes the effects of any accruals that we believe are appropriate, as well as the related net interest and penalties.

Income or Loss Per Share

 Income or Loss per Share

Basic income or loss per share is based on the average number of common shares outstanding.  Diluted income per share is based on the average number of common shares and the dilutive effect of stock options.  Stock options are not considered to be dilutive during loss periods.  The diluted net loss per share in fiscal 2012 excludes approximately 589,000 stock options as they had an anti-dilutive effect.  The diluted net income per share includes the effect of 254,000 stock options in fiscal 2011.

Cash and Cash Equivalents

Cash and Cash Equivalents

Highly liquid investments with a maturity of three months or less when purchased are considered to be cash equivalents.  At September 2012 and 2011, there were no cash equivalents.  The Company maintains deposits in financial institutions in excess of amounts guaranteed by the Federal Deposit Insurance Corporation.  Cash and cash equivalents are maintained at financial institutions and, at times, balances may exceed federally insured limits. We have never experienced any losses related to these balances. All of our non-interest bearing cash balances were fully insured at September 30, 2012 due to a temporary federal program in effect from December 31, 2010 through December 31, 2012. Under the program, there is no limit to the amount of insurance for eligible accounts. Beginning 2013, insurance coverage will revert to $250,000 per depositor at each financial institution, and our non-interest bearing cash balances may again exceed federally insured limits.

Accounts Receivable

Accounts Receivable

The Company extends credit to its various customers based on evaluation of the customer's financial condition and ability to pay the Company in accordance with the payment terms. An allowance for placement falloffs is recorded, as a reduction of revenues, for estimated losses due to applicants not remaining employed for the Company's guarantee period.  An allowance for doubtful accounts is recorded, as a charge to bad debt expense, where collection is considered to be doubtful due to credit issues.  These allowances together reflect management's estimate of the potential losses inherent in the accounts receivable balances, based on historical loss statistics and known factors impacting its customers.  The nature of the contract service business, where companies are dependent on employees for the production cycle allows for a small accounts receivable allowance.  Based on management's review of accounts receivable, an allowance for doubtful accounts of approximately $259,000 and $137,000 is considered necessary as of September 30, 2012 and September 30, 2011, respectively.  The Company charges uncollectible accounts against the allowance once the invoices are deemed unlikely to be collectible.  The Company does not accrue interest on past due receivables.

Property and Equipment

Property and Equipment

Property and equipment are recorded at cost.  Depreciation expense is calculated on a straight-line basis over estimated useful lives of five years for computer equipment and two to ten years for office equipment, furniture and fixtures.  The Company capitalizes computer software purchased or developed for internal use and amortizes it over an estimated useful life of five years.  The carrying value of property and equipment is reviewed for impairment whenever events or changes in circumstances indicate that it may not be recoverable.  If the carrying amount of an asset group is greater than its estimated future undiscounted cash flows, the carrying value is written down to the estimated fair value.  There was no impairment of property and equipment for the years ended September 30, 2012 and September 30, 2011.

Goodwill

Goodwill

Goodwill represents the excess of cost over the fair value of the net assets acquired in the June 1, 2010 acquisition of On-Site Services, Inc., the November 1, 2010 purchase of DMCC Staffing, LLC and RFFG of Cleveland, LLC and the Ashley Ellis, LLC acquisition on September 1, 2011.  The Company assesses goodwill for impairment at least annually.  The Company early adopted, Intangibles – Goodwill and Other (Topic 350): Testing Goodwill for Impairment, which allows the Company to first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If the entity determines that this threshold is not met, then performing the two-step impairment test is unnecessary.  An impairment loss would be recognized to the extent the carrying value of goodwill exceeds its implied fair value.

Fair Value Measurement

Fair Value Measurement

The Company follows the provisions of the accounting standard which defines fair value, establishes a framework for measuring fair value and enhances fair value measurement disclosure. Under these provisions, fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (i.e., the "exit price") in an orderly transaction between market participants at the measurement date.

The standard establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use on unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company's assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The hierarchy is described below:

Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs.

Level 2: Observable prices that are based on inputs not quoted on active markets, but corroborated by market data.

Level 3: Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs.

The fair value of the Company's current assets and current liabilities approximately their carrying values due to their short term nature.  The carrying value of the Company's long-term liabilities represents their fair value based on level 3 inputs further disclosed in note 11.  The Company's goodwill and other intangible assets are measured at fair value on a non-recurring basis using level 3 inputs, as further disclosed in Notes 4,5 and 8.

Intangible Assets

Intangible Assets

Customer lists, non-compete agreements, customer relationships, management agreements and trade names were recorded at their estimated fair value at the date of acquisition and are amortized over their estimated useful lives ranging from two to ten years using both accelerated and straight-line methods.

Impairment of Long-lived Assets

Impairment of Long-lived Assets

The Company records an impairment of long-lived assets used in operations, other than goodwill, when events or circumstances indicate that the asset might be impaired and the estimated undiscounted cash flows to be generated by those assets over their remaining lives are less than the carrying amount of those items.  The net carrying value of assets not recoverable is reduced to fair value, which is typically calculated using the discounted cash flow method.

Stock-Based Compensation

Stock-Based Compensation

Compensation expense is recorded for the fair value of stock options issued to directors and employees.  The expense is measured as the estimated fair value of the stock options on the date of grant and is recorded over the vesting periods.

Advertising

Advertising

The Company expenses advertising costs as incurred.  Advertising costs were approximately $870,000 and $541,000 for the years ended September 30, 2012 and 2011, respectively.

Segment Data

Segment Data

The Company has three operating business segments a) Contract staffing services, b) Direct hire placement services and c) Management services.  These operating segments were determined based primarily on how the chief operating decision maker views and evaluates our operations. Operating results are regularly reviewed by the chief operating decision maker to make decisions about resources to be allocated to the segment and to assess its performance. Other factors, including type of business, type of employee, length of employment, revenue recognition are considered in determining these operating segments.  Management services are no longer in operations during the year ended September 30, 2012.

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CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) (USD $) In Thousands, except Share data, unless otherwise specified	1 Months Ended
	Aug. 31, 2011 Ashley Ellis, LLC [Member]	Nov. 30, 2010 DMCC Staffing, LLC and RFFG of Cleveland, LLC [Member]
NON-CASH FINANCING AND INVESTING ACTIVITIES:
Purchased assets through the issuance of common stock (in shares)	1,250,000	5,581,395
Common stock value issued in exchange for assets	$ 331	$ 2,400

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CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) In Thousands, except Per Share data, unless otherwise specified	Sep. 30, 2012	Sep. 30, 2011
CURRENT ASSETS:
Accounts receivable, allowances	$ 259	$ 137
Property and equipment, accumulated depreciation and amortization	$ 3,240	$ 3,104
SHAREHOLDERS' EQUITY
Preferred stock, share authorized (in shares)	100	100
Preferred stock, par value (in dollars per share)	$ 0	$ 0
Preferred stock, share issued (in shares)	0	0
Preferred stock, share outstanding (in shares)	0	0
Common stock, par value (in dollars per share)	$ 0	$ 0
Common stock, shares authorized (in shares)	50,000	50,000
Common stock, shares issued (in shares)	21,699	21,699
Common stock, shares outstanding (in shares)	21,699	21,699

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Other Current Liabilities

12 Months Ended

Sep. 30, 2012

Other Current Liabilities [Abstract]

Other Current Liabilities

10. Other Current Liabilities

Other current liabilities consisted of the following:

	September 30th
(In Thousands)	2012		2011
Accrued expenses	$	282	$	201
Accrued rent		-		31
Second Installment of the Ashley Ellis, LLC purchase price		-		200
Contingent earn-out liability due within one year		834		803
Deferred rent		80		72
Total other current liabilities	$	1,196	$	1,307

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Document and Entity Information (USD $)	12 Months Ended
	Sep. 30, 2012	Mar. 28, 2013	Mar. 31, 2012
Document and Entity Information [Abstract]
Entity Registrant Name	GENERAL EMPLOYMENT ENTERPRISES INC
Entity Central Index Key	0000040570
Current Fiscal Year End Date	--09-30
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Smaller Reporting Company
Entity Public Float			$ 1,884,594
Entity Common Stock, Shares Outstanding		21,699,675
Document Fiscal Year Focus	2012
Document Fiscal Period Focus	FY
Document Type	10-K
Amendment Flag	false
Document Period End Date	Sep. 30, 2012

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Long-Term Liabilities

12 Months Ended

Sep. 30, 2012

Long-Term Liabilities [Abstract]

Long-Term Liabilities

11. Long-Term Liabilities

In connection with the completion of the sale of shares of common stock to PSQ in fiscal 2009, the Company's then Chairman, Chief Executive Officer and President (the "former CEO") retired from those positions and his employment agreement with the Company was replaced by a new consulting agreement.  Under the consulting agreement, the Company became obligated to pay an annual consulting fee of $180,000 over a five-year period and to issue 500,000 shares of common stock to the former CEO for no additional consideration.  During fiscal 2009, the Company recorded a liability for the net present value of the future payments in the amount of $790,000 and recorded additional common stock in the amount of $280,000 based on a quoted market price of $.56 per share on the date of the award.  As of September 30, 2012, the liability for future payments was reflected on the consolidated balance sheet as accrued compensation of $180,000 and long-term liability of $100,000.  As of September 30, 2011, the liability for future payments was reflected on the consolidated balance sheet as accrued compensation of $180,000 and a long-term liability of $280,000.

In November 2010, in conjunction with the purchase of RFFG of Cleveland and DMCC the Company accrued an earn-out liability as discussed in Note 4, which was subsequently reduced by $1,276,000.  There is no longer a remaining long-term earn-out liability on September 30, 2012.

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CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) In Thousands, except Per Share data, unless otherwise specified	12 Months Ended
	Sep. 30, 2012	Sep. 30, 2011
NET REVENUES:
Contract staffing services	$ 45,190	$ 31,921
Direct hire placement services	7,215	4,430
Management services	0	838
NET REVENUES	52,405	37,189
Cost of contract services	38,236	27,405
Selling, general and administrative expenses	14,308	8,841
Amortization of intangible assets	394	537
Loss on impairment of intangible assets and goodwill	274	1,126
Reduction of earn-out liability	0	(1,276)
INCOME (LOSS) FROM OPERATIONS	(807)	556
Interest expense	(204)	(198)
NET (LOSS) INCOME	$ (1,011)	$ 358
NET INCOME (LOSS) PER SHARE - BASIC (in dollars per share)	$ (0.05)	$ 0.02
NET INCOME (LOSS) PER SHARE - DILUTED (in dollars per share)	$ (0.05)	$ 0.02
WEIGHTED AVERAGE NUMBER OF SHARES - BASIC (in shares)	21,699	18,394
WEIGHTED AVERAGE NUMBER OF SHARES - DILUTED (in shares)	21,699	18,648

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Entry into Management Service Agreement

12 Months Ended

Sep. 30, 2012

Entry into Management Service Agreement [Abstract]

Entry into Management Service Agreement

5. Entry into Management Service Agreement

In conjunction with the Asset Purchase Agreement for DMCC and RFFG of Cleveland, BMP, an Ohio corporation and a wholly-owned subsidiary of the Company, entered into a management service agreement (the "Management Agreement") with RFFG effective November 1, 2010.

Pursuant to the Management Agreement, BMP agreed to provide services to RFFG to operate its day-to-day business, including services related to accounting, sales, finance, workers' compensation, benefits, physical locations, information technologies and employees.  The Management Agreement provided that additional services may be added if BMP and RFFG mutually agree to the cost to be charged by BMP for such services and as long as BMP has the resources to provide such services.

In consideration of the services provided under the Management Agreement, RFFG, LLC agreed to pay BMP monthly fees that approximate 6% of its gross revenues on an annual basis.  For the year ended September 30, 2011, the Company recorded approximately $838,000 of revenue related to this agreement.  As of September 30, 2011, BMP has $225,000 of management fee receivable.

Due to an unresolved issue with the Ohio Bureau of Workers Compensation, RFFG ceased operations as of July 15, 2011 and, as a result, the Management Agreement was effectively terminated.  As a result, the Company recorded a loss on impairment of intangible assets of $1,126,000 (as discussed further in Note 9), offset by income of $1,276,000 for the reduction of an associated earn-out liability.   There was approximately $140,000 unpaid related to this Management Agreement, which was offset against amounts owed related to the earn-out agreement.  In addition, since the Company was providing certain management services, RFFG and the transactions between RFFG and the Company were considered to be related party in nature because Thomas Bean was a 10% owner of the Company at the time.

There continued to be some expenses related to transportation, fuel and utilities that were paid by the Company to RFFG after RFFG ceased operations and the Management Agreement was effectively terminated.

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Acquisitions

12 Months Ended

Sep. 30, 2012

Acquisitions [Abstract]

Acquisitions

4. Acquisitions

In connection with the application of purchase accounting, the Company recorded its identifiable intangible assets at fair value.  Fair value of the intangible assets was determined primarily through the use of a discounted cash flow analysis.  The discounted cash flow analysis projected the estimated future cash flows to be generated by the underlying assets and discounted these at a rate reflecting perceived business and financial risks.  The projected cash flow estimates used in the discounted cash flow analysis are based on management's best estimate and actual results may differ.  The valuation of these intangible assets is based predominately on Level 3 inputs.

Ashley Ellis, LLC

On August 31, 2011, General Employment Enterprises, Inc. (the "Company") entered into an asset purchase agreement with Ashley Ellis LLC, an Illinois limited liability company ("Ashley Ellis"), and Brad A. Imhoff (the "Ashley Ellis Asset Purchase Agreement"), for the purchase of certain assets of Ashley Ellis, primarily customer lists, comprising Ashley Ellis' services business.  Ashley Ellis' services business was operated from offices in Illinois, Texas and Georgia and provided services related to the recruitment and placement of technical personnel.  The Ashley Ellis Asset Purchase Agreement was deemed effective on September 1, 2011.

Brad A. Imhoff is the brother of Herbert F. Imhoff, Jr., a former director and President of the Company who retired from all positions effective January 31, 2013.  Brad A. Imhoff and Ashley Ellis, an entity of which Brad A. Imhoff is the sole member and Chief Executive Officer, were parties to the transaction.  As consideration for the assets, the Company paid Ashley Ellis $200,000 on the date of closing and paid Ashley Ellis an additional $200,000 within six months of closing.  The Company also issued to Ashley Ellis 1,250,000 restricted shares of the Company's common stock.  As the sole member of Ashley Ellis, Brad A. Imhoff has an interest in the entire consideration paid by the Company to Ashley Ellis for the assets.

In connection with the transactions contemplated by the Ashley Ellis Asset Purchase Agreement, on August 31, 2011, the Company and Ashley Ellis entered into a registration rights agreement (the "Registration Rights Agreement"), pursuant to which Ashley Ellis was granted certain piggyback registration rights with respect to the Shares to be issued to Ashley Ellis under the Ashley Ellis Asset Purchase Agreement.  The Registration Rights Agreement contains certain indemnification provisions for the benefit of the Company and Ashley Ellis and other customary provisions.  The total consideration is summarized as follows:

In Thousands
Stock consideration	$	331
Cash consideration		400
Total consideration for acquisition	$	731

The following table summarizes the approximate fair value of the assets acquired and liabilities assumed at the date of closing.

In Thousands
Property and Equipment	$	114
Intangible assets – trade name		17
Intangible assets – customer relationships		577
Goodwill		23
Total fair value of assets acquired	$	731

The assets purchased from Ashley Ellis constitute a business and as such, the acquisition of these assets was accounted for as a business combination. The assets purchased related to the Ashley Ellis, LLC acquisition was not considered a significant acquisition.  The results of operations of Ashley Ellis, LLC are included in the Company's statement of operations from the effective date of the acquisition, September 1, 2011.  Goodwill and the intangible assets acquired in this transaction are deductible for tax purposes.

Acquisition of DMCC Staffing, LLC and RFFG of Cleveland, LLC

Effective November 1, 2010, the Company, through its wholly-owned subsidiary, Triad Personnel Services, Inc. (Triad), entered into an asset purchase agreement (the "Asset Purchase Agreement"), dated as of October 29, 2010, with DMCC Staffing, LLC ("DMCC"), RFFG of Cleveland, LLC ("RFFG of Cleveland"), and Thomas J. Bean, for the purchase of certain assets of DMCC and RFFG of Cleveland, primarily customer lists, comprising DMCC's and RFFG of Cleveland's services business.  Thomas Bean was the beneficial owner of approximately 9.9% of the Company's outstanding shares prior to this acquisition.  The business is primarily operated from offices in Ohio and provides labor and human resource solutions, including temporary staffing, human resources and payroll outsourcing services, labor and employment consulting and workforce solutions.  When the assets were purchased, there was only one primary customer.

The closing of the Asset Purchase Agreement was subject to certain conditions, including entry into a definitive management and services agreement for the management of the businesses of certain affiliates of DMCC, RFFG of Cleveland and Mr. Bean (the "Management Agreement") by the Company.  On November 30, 2010, Business Management Personnel, Inc. ("BMP"), a wholly-owned subsidiary of the Company, entered into the Management Agreement, effective as of November 1, 2010, with RFFG, LLC ("RFFG"). The Management Agreement was terminated in July 2011. Refer to Note 5, Entry into Management Agreement for a further description.

The assets purchased from RFFG of Cleveland and DMCC constitute businesses and as such the acquisition of these assets were accounted for as a business combination. Pursuant to the Asset Purchase Agreement, the Company agreed to issue $2,400,000 in shares of its common stock (5,581,395 shares based on the December 30, 2010 closing date) to DMCC and RFFG of Cleveland upon receipt of (a) stockholder approval of the transaction and of an increase to the Company's authorized Common Stock and (b) approval of an additional listing application by the NYSE MKT.  On March 24, 2011, the Company received written consents in lieu of a meeting of shareholders from the holders of 71.9% of the shares of Common Stock, (i) approving the issuance of 5,581,395 shares of the Common Stock to DMCC Staffing and RFFG of Cleveland pursuant to the Asset Purchase Agreement and the issuance of any additional shares of Common Stock to DMCC and RFFG of Cleveland as may be necessary pursuant to certain earn-out payment provisions under the Asset Purchase Agreement; and (ii) approving an amendment to the Articles of Incorporation of the Company to increase the number of authorized shares of capital stock from 20,100,000 shares to 50,100,000 shares and to increase the number of authorized shares of Common Stock from 20,000,000 shares to 50,000,000 shares.

Commencing in 2011, if the aggregate EBITDA of the businesses acquired, plus any management fees paid to the Company under the Management Agreement meets certain targets (each, an "EBITDA Target") over a four-year period ending December 31, 2014 (the "Earnout Period"), the Company will be required to make earn-out payments to DMCC and RFFG of Cleveland, each payable in three equal installments.  In the event that an EBITDA Target for a certain period is not met, the earn-out payment in respect to such period will be reduced proportionately.  The EBITDA Targets are $300,000, $600,000, $900,000 and $1,200,000 for each of the three-, six-, nine- and twelve-month periods, respectively, in the fiscal year ending December 31, 2011, and earn-out payments will consist of quarterly payments of $150,000, payable in three equal monthly installments, if the relevant EBITDA Targets are met.  Starting in the fiscal year ending December 31, 2012, the EBITDA Targets will be adjusted annually to reflect the EBITDA for the twelve-month period ending on December 31st of the most recently completed fiscal year (each, an "Annual EBITDA Target") and earn-out payments for the year will be adjusted to equal 50% of the relevant Annual EBITDA Target divided by four.  At the end of each fiscal year during the Earnout Period, if the aggregate EBITDA for the 12-month period then ended is greater than the Annual EBITDA Target for such year, then the Company will pay to DMCC and RFFG of Cleveland the amount of such excess, 50% in cash and 50% in shares of common stock.  Through September 30, 2012, $232,000 has been earned related to the purchase agreement earn-out, net of off-sets, and the Company made one $50,000 cash payment against this liability.

The Company is currently in discussions with RFFG to amend the Asset Purchase Agreement as it relates to the earn-out since the value of the Management Agreement was a significant value of the original agreement and was terminated in July 2011.

The accounting guidance requires that contingent consideration be added to the purchase price and the resultant liability be recorded at fair value.  Given the terms of the earn-out provisions of the Asset Purchase Agreement, the Company believes that the earn-out will be paid and accordingly, has included the fair value of the projected total earn-out payments in the total consideration paid for the acquisition.  Any subsequent changes in the estimated fair value of this contingent consideration will be recorded in the Company's statement of operations.  At September 30, 2012 the expected earn-out liability is approximately $845,000 based on the originally present value accounting for the transaction.

The total consideration is summarized as follows:

In Thousands
Stock consideration	$	2,400
Earn-out consideration		2,198
Total consideration for acquisition	$	4,598

The following table summarizes the approximate fair value of the assets acquired and liabilities assumed at the date of closing.

In Thousands
Property and equipment	$	5
Intangible assets - management agreement		1,396
Intangible assets - customer relationships		2,113
Goodwill		1,084
Total fair value of assets acquired	$	4,598

Goodwill and the intangible assets acquired in this transaction are deductible for tax purposes.

The Company wrote off the intangible asset associated with the management agreement of approximately $1,126,000 and reduced the earn-out liability by $1,276,000 when it was determined that RFFG ceased doing business on July 15, 2011 and therefore, future management fees would no longer would be earned, as discussed further in Note 5.

As with any asset purchase of a business the purchaser may be held accountable for the seller's debts and liabilities where; (i) there is an express or implied agreement of assumption; (ii) the transaction amounts to a de facto consolidation or merger of the buyer or seller corporation; (iii) the purchaser is merely a continuation of the seller; or (iv) the transaction is for the fraudulent purpose of escaping liability for the seller's obligations.  There are always several factors in the determination of any successor corporation legal liabilities related to the predecessor company.   Other than the current litigation related to the Ohio Bureau of Workers Compensation, the Company has not been noticed of any additional claims, however additional claims could be material to the business.

The loss of a significant customer by Onsite during the year ended September 30, 2012 had a negative effect on future earnings and cash flows from operations, and is a factor indicating the possibility of future impairment to the Company's goodwill. The Company has determined that based on expected future cash flows there was an impairment of the related intangible assets of approximately $274,000.

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Segment Data

12 Months Ended

Sep. 30, 2012

Segment Data [Abstract]

Segment Data

16. Segment Data

As a result of the acquisition of certain of the assets of DMCC and RFFG of Cleveland and entry into the Management Agreement discussed above, the Company's internal reporting was adjusted and as a result, the Company re-assessed its segment presentation.  Accordingly, the Company's segment disclosures were revised in the current year.

The Company provides the following distinctive services: (a) direct hire placement services, (b) temporary professional services staffing in the fields of information technology, engineering, and accounting, (c) temporary staffing in the agricultural industry, (d) temporary light industrial staffing and (e) management services.  Intersegment net service revenues are not significant.  Revenues generated from the temporary professional services staffing, temporary staffing in the agricultural industry and light industrial staffing are classified as contract staffing services revenues in the statements of operations.  Selling, general and administrative expenses are not separately allocated among agricultural, professional services or industrial staffing services within the contract staffing services sector for internal reporting purposes.

	Fiscal Year Ended
	September 30
(In Thousands)	2012			2011
Direct Hire Placement Services
Revenue	$	7,215		$	4,430
Placement services gross margin		100	%		100	%
Operating loss		(1,701	)		(678	)
Depreciation & amortization		237			180
Accounts receivable – net		980			699
Intangible assets		465			584
Goodwill		24			24
Total assets		3,334			5,301
Management Services
Revenue	$	—		$	838
Operating income		—			519
Fee receivable		—			225
Total assets		—			225
Contract Staffing Services
Agricultural services revenue	$	7,852		$	12,412
Industrial services revenue		28,206			12,349
Professional services revenue		9,132			7,160
Agricultural services gross margin		4.41	%		4.6	%
Industrial services gross margin		17.15	%		14.6	%
Professional services gross margin		19.38	%		29.9	%
Operating income (loss)	$	894		$	715
Depreciation and amortization		309			533
Accounts receivable – agricultural services		597			666
Accounts receivable – industrial services		4,056			3,837
Accounts receivable – professional services		1,128			1,177
Intangible assets		1,739			2,115
Goodwill		1,083			1,256
Total assets	$	7,865		$	5,970
Consolidated
Total revenue	$	52,405		$	37,189
Operating income (loss)		(807	)		556
Depreciation and amortization		546			713
Total accounts receivables – net		6,761			6,604
Intangible assets		2,204			2,699
Goodwill		1,106			1,280
Total assets	$	11,199		$	11,496

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Common Stock

12 Months Ended

Sep. 30, 2012

Common Stock [Abstract]

Common Stock

12. Common Stock

In November 2010, the Company issued 5,581,395 shares of common stock in connection with the acquisition of DMCC and RFFG of Cleveland.

In September 2011, the Company issued 1,250,000 shares of its common stock in connection with the acquisition of Ashley Ellis, LLC.

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Goodwill and Intangible Assets

12 Months Ended

Sep. 30, 2012

Goodwill and Intangible Assets [Abstract]

Goodwill and Intangible Assets

8. Goodwill and Intangible Assets

Goodwill

Goodwill represents the excess of cost over the fair value of the net assets acquired from various acquisitions. Goodwill is not amortized.  The Company performs a goodwill impairment test annually, by reporting unit, in the fourth quarter of the fiscal year, or whenever potential impairment triggers occur.  Should the two-step process be necessary, the first step of the impairment test identifies potential impairment by comparing the fair value of a reporting unit to its carrying value including goodwill. In applying a fair-value-based test, estimates are made of the expected future cash flows to be derived from the reporting unit. Similar to the review for impairment of other long-lived assets, the resulting fair value determination is significantly impacted by estimates of future margins, capital needs, economic trends and other factors. If the carrying value of the reporting unit exceeds its fair value, the second step of the impairment test is performed to measure the amount of impairment loss, if any. The second step of the impairment test compares the implied fair value of the reporting unit goodwill with the carrying amount of that goodwill. An impairment loss would be recognized to the extent the carrying value of goodwill exceeds its implied fair value.

The loss of a significant customer by Onsite during the year ended September 30, 2012 had a negative effect on future earnings and cash flows from operations, and is a factor indicating the possibility of future impairment to the Company's goodwill. The Company has determined that based on expected future cash flows there was an impairment of the related intangible assets of $101,000 and goodwill of approximately $173,000.

Intangible Assets

As of September 30, 2012

(In Thousands)	Cost		Accumulated Amortization		Loss on impairment of Intangible assets		Net Book Value
Non-Compete	$	89	$	48		41	$	—
Customer Relationships		2,913		662		60		2,191
Management Agreement		1,396		270		1,126		—
Trade Name		17		4		—		13
	$	4,415	$	984	$	1,227	$	2,204

As of September 30, 2011

(In Thousands)	Cost		Accumulated Amortization		Loss on impairment of Intangible assets		Net Book Value
Non-Compete	$	89	$	24		—	$	65
Customer Relationships		2,913		296		—		2,617
Management Agreement		1,396		270		1,126		—
Trade Name		17		—		—		17
	$	4,415	$	590	$	1,126	$	2,699

Amortization expense was approximately $394,000 and approximately $537,000 for the years ended September 30, 2012 and 2011, respectively.

Finite life intangible assets are comprised of a non-compete agreement, management agreement, trade name and customer relationships.  The non-compete agreement and trade name are amortized on a straight – line basis over the estimated useful lives of 5 years.  The customer relationships are amortized based on the future undiscounted cash flows over estimated remaining useful lives of three to 10 years.  The management agreement intangible was being amortized over the five year term of the agreement.  Over the next five years, annual amortization expense for these finite life intangible assets will be $393,000 in 2013, $376,000 in 2014, $359,000 in 2015, $340,000 in 2016 and $322,000 in 2017 and $414,000 thereafter.

Long-lived assets, such as purchased intangibles subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.  The Company evaluates, regularly, whether events and circumstances have occurred that indicate possible impairment and relies on a number of factors, including operating results, business plans, economic projections, and anticipated future cash flows.  The Company uses an estimate of the future undiscounted net cash flows of the related asset or asset group over the remaining life in measuring whether the assets are recoverable.

During the year ended, September 30, 2012, the Company recorded an impairment charge of approximately $101,000 for the remaining unamortized amount of the non-compete and a certain amount of the customer relationship intangible asset related to the agricultural operation.  In addition the Company recorded an impairment charge of approximately $173,000 related to the goodwill of the agriculture operation.   The impairment charge represents the difference between the fair value and the carrying value of the intangible assets.  The agricultural operation has limited margins and lost a large customer and management determined that the present value of the future cash flows associated with the operation did not support the recorded value.

During the year ended, September 30, 2011, the Company recorded an impairment charge of $1,126,000 for the remaining unamortized amount of the Management Agreement intangible asset.  The impairment charge represents the difference between the fair value and the carrying value of the intangible asset.  No future cash flows associated with the Management Agreement are expected as the management agreement was effectively terminated as a result of the managed entity, RFFG, ceasing operations in July 2011.

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Placement Service Revenues

12 Months Ended

Sep. 30, 2012

Placement Service Revenues [Abstract]

Placement Service Revenues

6. Placement Service Revenues

The provision for falloffs and refunds, which is reflected in the consolidated statements of operations as a reduction of placement service revenues, was $1,026,000 in fiscal 2012 and $695,000 in fiscal 2011.

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Property and Equipment

12 Months Ended

Sep. 30, 2012

Property and Equipment [Abstract]

Property and Equipment

7. Property and Equipment

Property and equipment consisted of the following as of September 30th:

(In Thousands)	Useful Lives	2012			2011
Computer software	5 years	$	1,447		$	1,447
Office equipment, furniture and fixtures and leasehold improvements	2 to 10 years		2,311			2,066
Total property and equipment, at cost			3,758			3,513
Accumulated depreciation and amortization			(3,240	)		(3,104	)
Property and equipment, net		$	518		$	409

Disposals of property and equipment, consisting primarily of fully-depreciated office furniture and equipment, had an original cost of $16,000 and $24,000 in fiscal 2012 and 2011, respectively.  Leasehold improvements are amortized over the term of the lease.

Depreciation expense for the years ended September 30, 2012 and 2011 was approximately $152,000 and $176,000, respectively.

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Short-term Debt

12 Months Ended

Sep. 30, 2012

Short-term Debt [Abstract]

Short-term Debt

9. Short-term Debt

The Company, through December 2010, had a loan and security agreement with Crest mark Bank for the financing of its accounts receivable.  Under the terms, the Company could borrow up to 85% of its eligible accounts receivable, not to exceed $3,500,000.  The loan was secured by accounts receivable and other property of the Company.  Interest was charged at the rate of 1% above the prime rate.  Interest expense under this agreement was $4,500 for the year ending September 30, 2011.  In addition, the agreement required a maintenance fee of $3,500 per month and an annual loan fee of 1% of the maximum borrowing amount under the agreement.  The Company incurred $29,000 of fees related to this agreement during the year ended September 30, 2011.

In December 2010, the Company terminated its agreement with Crest mark Bank and entered into a two-year, $3,000,000 account purchase agreement ("AR Credit Facility") with Wells Fargo Bank N.A. ("Wells Fargo") which has been subsequently amended.  The AR Credit Facility as amended, provides for borrowings, on a revolving basis, of up to 85% of the Company's eligible accounts receivable less than 90 days old and bears interest at a rate equal to the three month LIBOR plus 5.25% (effective rate was 5.65% as of September 30, 2012 and 5.75 % as of September 30, 2011).  Under the terms and subject to the conditions in the agreement, Wells Fargo may determine which receivables are eligible receivables, may determine the amount it will advance on any such receivables, and may require the Company to repay advances made on receivables and thereby repay amounts outstanding under the AR Credit Facility on demand.  Wells Fargo also has the right to require the Company to repurchase receivables that remain outstanding 90 days past their invoice date.  The Company continues to be responsible for the servicing and administration of the receivables purchased and carries the receivables and any outstanding borrowings on its consolidated balance sheet.

On January 14, 2013, the Company and Wells Fargo Bank, National Association entered into a Fifth Amendment (the "Fifth Amendment") to its AR Credit Facility.  The Fifth Amendment extended the term of the AR Credit Facility to December 14, 2013.  Notwithstanding the foregoing extension, Wells Fargo may issue a written notice to the Company shortening the term of the of the AR Credit Facility to a date 60 days following such notice in the event that (i) the Company is not dismissed without prejudice from a recently brought lawsuit entitled Derby Capital LLC and Derby Capital JOB LLC, as plaintiffs, vs. Trinity HR Services, LLC, et al., as defendants, a lawsuit seeking to establish relative ownership among stockholders which the Company believes it should not be a party to, (ii) the Company fails to furnish Wells Fargo its audited financial statements for its fiscal year ended September 30, 2012 by March 15, 2013 or if the results in such audited financial statements are not satisfactory to Wells Fargo in its sole discretion,  (iii) background checks of newly appointed officers of the Company are unsatisfactory to Wells Fargo in its sole discretion, or (iv) significant changes have occurred to the composition of the Company's Board of Directors as determined by Wells Fargo in its sole discretion.  In March 2013, the Company and Wells Fargo entered into a Sixth Amendment that extended the required delivery date on certain of the foregoing requirements, such as the audited financial statements, until April 30, 2013.  To date, the Company has not received notice from Wells Fargo of any intent to shorten the term of the AR Credit Facility.

The AR Credit Facility with Wells Fargo Bank includes certain covenants which require compliance until termination of the agreement.  As of September 30, 2012, the Company was in compliance with all such covenants.

The Company believes that the borrowing availability provided by the AR Credit Facility will be adequate to fund the increase in working capital needs resulting from the acquisitions of certain assets of On-Site, RFFG of Cleveland, DMCC and Ashley Ellis, LLC.

As of September 30, 2012, the borrowing base availability under this agreement was $596,000 and the outstanding borrowings, which are classified as short-term debt on the 2012 consolidated balance sheet, were approximately $2,404,000.  Total interest expense related to the line of credit for the years ending September 30, 2012 and September 30, 2011 approximated $176,000 and $79,000, respectively.

The AR Credit Facility includes certain covenants which require compliance until termination of the agreement.  As of the date of March 29, 2013, the Company was in compliance with all such covenants.

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Acquisitions (Details) (USD $)	3 Months Ended	6 Months Ended	9 Months Ended	12 Months Ended
	Dec. 31, 2010	Mar. 31, 2011	Jun. 30, 2011	Sep. 30, 2012 Customer	Sep. 30, 2011 Installment EBITDAPart	Mar. 24, 2011
Business Acquisition [Line Items]
Acquisition payment				$ 200,000	$ 200,000
Schedule of fair value of assets acquired and liabilities assumed at the date of closing [Abstract]
Issuance of common stock for acquisitions					2,731,000
Common stock shares authorized after amendment (in shares)				50,000,000	50,000,000
Impairment of intangible assets				101,000	1,126,000
Reduction of earn out liability				0	(1,276,000)
Ashley Ellis, LLC [Member]
Business Acquisition [Line Items]
Acquisition payment				200,000
Additional payment for acquisition				200,000
Purchased assets through the issuance of common stock (in shares)				1,250,000
Summary of total consideration [Abstract]
Stock consideration				331,000
Cash consideration				400,000
Total consideration for acquisition				731,000
Schedule of fair value of assets acquired and liabilities assumed at the date of closing [Abstract]
Property and Equipment				114
Goodwill				23
Total fair value of assets acquired				731
Ashley Ellis, LLC [Member] | Trade names [Member]
Schedule of fair value of assets acquired and liabilities assumed at the date of closing [Abstract]
Intangible assets				17
Ashley Ellis, LLC [Member] | Customer relationships [Member]
Schedule of fair value of assets acquired and liabilities assumed at the date of closing [Abstract]
Intangible assets				577
DMCC Staffing, LLC and RFFG of Cleveland, LLC [Member]
Business Acquisition [Line Items]
Purchased assets through the issuance of common stock (in shares)	5,581,395
Summary of total consideration [Abstract]
Stock consideration				2,400,000
Earn-out consideration				2,198,000
Total consideration for acquisition				4,598,000
Schedule of fair value of assets acquired and liabilities assumed at the date of closing [Abstract]
Property and Equipment				5,000
Goodwill				1,084,000
Total fair value of assets acquired				4,598,000
Percentage of outstanding shares prior to acquisition (in hundredths)				9.90%
Number of customers				1
Issuance of common stock for acquisitions				2,400,000
Percentages of shareholders written consents in lieu of a meeting (in hundredths)				71.90%
Capital stock authorized				50,100,000		20,100,000
Common stock shares authorized after amendment (in shares)				50,000,000		20,000,000
EBITDA target period per agreement					4 years
Number of installments within which earn out payments is payable					3
EBITDA target as per agreement	300,000	600,000	900,000		1,200,000
Earn-out quarterly payments					150,000
Number of monthly installments require for earn out payments					3
Percentages of earn out payments on annual EBITDA (in hundredths)					50.00%
Number of parts in which annual EBITDA divided					4
Maximum percentage of cash entity will pay to DMCC and RFFG of Cleveland per agreement (in hundredths)					50.00%
Maximum percentage of common stock issued to DMCC and RFFG per agreement (in hundredths)					50.00%
Earn-out payments					232,000
Earn-out payments payable in cash					50,000
Current portion of estimated earn out payments					845,000
Impairment of intangible assets				1,126,000
Reduction of earn out liability				1,276,000
Impairment of intangible assets				274,000
DMCC Staffing, LLC and RFFG of Cleveland, LLC [Member] | Customer relationships [Member]
Schedule of fair value of assets acquired and liabilities assumed at the date of closing [Abstract]
Intangible assets				2,113,000
DMCC Staffing, LLC and RFFG of Cleveland, LLC [Member] | Management agreement [Member]
Schedule of fair value of assets acquired and liabilities assumed at the date of closing [Abstract]
Intangible assets				$ 1,396,000

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Income Taxes

12 Months Ended

Sep. 30, 2012

Income Taxes [Abstract]

Income Taxes

14. Income Taxes

The components of the provision for income taxes are as follows:

	Year Ending September 30,
(In Thousands)	2012			2011
Current tax provision	$	—		$	—
Deferred tax provision (credit) related to:
Temporary differences
Stock option Expense		74			2
Deferred compensation expense		(60	)		(57	)
Vacation expense		39			32
Intangible assets		94			(272	)
Allowance for doubtful accounts		46			19
Other		(45	)		(24	)
Loss carryforwards		(194	)		104
Valuation allowances		46			196
Provision for income taxes	$	—		$	—

The differences between income taxes calculated at the 34% statutory U.S. federal income tax rate and the Company's provision for income taxes are as follows:

	Year Ended September 30,
(In Thousands)	2012			2011
Income tax provision at statutory federal tax rate	$	50		$	122
Valuation allowance		(50	)		(122	)
Provision for income taxes	$	—		$	—

The net deferred income tax asset balance related to the following:

	Year Ended September 30,
(In Thousands)	2012			2011
Temporary differences				$
Stock option Expense	$	217			138
Deferred compensation expense		120			184
Vacation expense		30			47
Intangible assets		107			282
Allowance for doubtful accounts		104			55
Other		85			105
Net operating loss carryforwards		3,560			3,366
Valuation allowances		(4,223	)		(4,177	)
Net deferred income tax asset	$	—		$	—

As of September 30, 2012 there were approximately $8,900,000 of losses available to reduce federal taxable income in future years through 2031, and there were approximately $7,525,000 of losses available to reduce state taxable income in future years, expiring from 2012 through 2031.  Due to common stock transactions in the current and prior years, it is likely that the Company will be limited by Section 382 of the Internal Revenue Code as to the amount of net operating losses that may be used in future years.  The Company is currently evaluating the effects of any such limitation.

Future realization of the tax benefits of existing temporary differences and net operating loss carryforwards ultimately depends on the existence of sufficient taxable income within the carryforward period.  As of September 30, 2012 and 2011, the Company performed an evaluation to determine whether a valuation allowance was needed.  The Company considered all available evidence, both positive and negative, which included the results of operations for the current and preceding years.  The Company also considered whether there was any currently available information about future years.  Because long-term contracts are not a significant part of the Company's business, future results cannot be reliably predicted by considering past trends or by extrapolating past results.  Moreover, the Company's earnings are strongly influenced by national economic conditions and have been volatile in the past.  Considering these factors, the Company determined that it was not possible to reasonably quantify future taxable income.  The Company determined that it is more likely than not that all of the deferred tax assets will not be realized.  Accordingly, the Company maintained a full valuation allowance as of September 30, 2012 and 2011.

As a result of continuing losses, we have determined that it is more likely than not that we will not realize the benefits of the deferred tax assets and therefore we have recorded a valuation allowance to reduce the carrying value of the deferred tax assets to zero. As a result, the valuation allowance on our net deferred tax assets decreased by approximately $131,000 for the year ended September 31, 2012.

We file federal and state income tax returns in jurisdictions with varying statutes of limitations. Due to our net operating loss carryforwards, our income tax returns generally remain subject to examination by federal and most state tax authorities. We are not currently under examination in any federal or state jurisdiction.

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Property and Equipment (Tables)

12 Months Ended

Sep. 30, 2012

Property and Equipment [Abstract]

Schedule of property and equipment

Property and equipment consisted of the following as of September 30th:

(In Thousands)	Useful Lives	2012			2011
Computer software	5 years	$	1,447		$	1,447
Office equipment, furniture and fixtures and leasehold improvements	2 to 10 years		2,311			2,066
Total property and equipment, at cost			3,758			3,513
Accumulated depreciation and amortization			(3,240	)		(3,104	)
Property and equipment, net		$	518		$	409

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Long-Term Liabilities (Details) (USD $)	12 Months Ended
	Sep. 30, 2012	Sep. 30, 2011	Sep. 30, 2012 DMCC Staffing, LLC and RFFG of Cleveland, LLC [Member]	Sep. 30, 2012 President [Member]	Sep. 30, 2011 President [Member]	Sep. 30, 2009 President [Member]
Debt Instrument [Line Items]
Annual consulting fee				$ 180,000
Period within which annual consulting fee is payable				5 years
Number of shares issued under consulting agreement (in shares)				500,000
Net present value of future payments				790,000
Liability recorded for additional common stock issued						280,000
Quoted market price of stock (in dollars per share)				$ 0.56
Liability for future payments reflected as accrued compensation	3,068,000	2,391,000		180,000	180,000
Liability for future payments reflected as long-term obligations	253,000	681,000		100,000	280,000
Reduction of earn out liability	0	(1,276,000)	1,276,000
Reduction long term earn out liability			$ 0

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CONSOLIDATED STATEMENTS OF SHAREHOLDERS EQUITY (USD $)	Common Stock [Member]	Accumulated Deficit [Member]	Total
Balance at Sep. 30, 2010	$ 7,287,000	$ (5,695,000)	$ 1,592,000
Balance (in shares) at Sep. 30, 2010	14,856,000
Issuance of common stock for acquisitions	2,731,000	0	2,731,000
Issuance of common stock for acquisitions (in shares)	6,831,000
Exercises of stock options	5,000	0	5,000
Exercises of stock options (in shares)	12,000		12,000
Stock compensation expense	8,000	0	8,000
Net income (loss)	0	358,000	358,000
Balance at Sep. 30, 2011	10,031,000	(5,337,000)	4,694,000
Balance (in shares) at Sep. 30, 2011	21,699,000		21,699,000
Exercises of stock options (in shares)			0
Stock compensation expense	422,000		422,000
Net income (loss)	0	(1,011,000)	(1,011,000)
Balance at Sep. 30, 2012	$ 10,453,000	$ (6,348,000)	$ 4,105,000
Balance (in shares) at Sep. 30, 2012	21,699,000		21,699,000

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Recent Accounting Pronouncements

12 Months Ended

Sep. 30, 2012

Recent Accounting Pronouncements [Abstract]

Recent Accounting Pronouncements

3. Recent Accounting Pronouncements

In May 2011, the FASB issued ASU No. 2011-04, "Fair Value Measurements (Topic 820): Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs," ("ASU 2011-04"). ASU 2011-04 expands the disclosures for fair value measurements that are estimated using significant unobservable (Level 3) inputs. This new guidance is to be applied prospectively. This guidance was effective for the Company beginning January 1, 2012. The adoption of this standard did not materially affect the consolidated financial statements.

In July 2012, the FASB issued ASU 2012-02 – Testing indefinite-Lived Intangible Assets for Impairments ("ASU 2012-02", which amends the guidance in ASC 350-30 on testing indefinite-lived intangible assets, other than goodwill, for impairments.  FASB issued ASU 2012-12 in response to feedback on ASU 2011-08, which amended the goodwill impairment testing requirements by allowing an entity to perform a qualitative impairment assessment before proceeding to the two-step impairment test.  Similarly, under ASU 2012-02, an entity testing an indefinite-lived intangible asset for impairment has the option of performing a qualitative assessment before calculating the fair value of the asset. If the entity determines, on the basis of quantitative factors, that the fair value of the indefinite-lived intangible asset is not more likely than note (i.e. a likelihood of more than 50 percent) impaired, the entity would not need to calculate the fair value of the asset.  ASU 2012-02 does note revise the requirement to test indefinite-lived intangible assets annually for impairment.  In addition, the ASU 2012-02 does not amend the requirement to test these assets for impairment between annual tests if there is a change in the events or circumstances; however, it does revise the examples of events and circumstances that an entity should consider in interim periods. ASU 201-02 is effective for annual and interim impairment tests performed for fiscal years beginning after September 15, 2012.  Early adoption is permitted.  The Company does not expect the adoption of this guidance to have a material effect on the Company's consolidated financial statements.

Other recent accounting pronouncements issued by FASB, including its Emerging Issues Task Force ("EITF"), the American Institute of Certified Accountants ("AICPA"), and the SEC did not or are not believed by management to have a material impact on the Company's present or future financial statements.

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Goodwill and Intangible Assets (Tables)

12 Months Ended

Sep. 30, 2012

Goodwill and Intangible Assets [Abstract]

Schedule of finite-lived intangible assets

Intangible Assets

As of September 30, 2012

(In Thousands)	Cost		Accumulated Amortization		Loss on impairment of Intangible assets		Net Book Value
Non-Compete	$	89	$	48		41	$	—
Customer Relationships		2,913		662		60		2,191
Management Agreement		1,396		270		1,126		—
Trade Name		17		4		—		13
	$	4,415	$	984	$	1,227	$	2,204

As of September 30, 2011

(In Thousands)	Cost		Accumulated Amortization		Loss on impairment of Intangible assets		Net Book Value
Non-Compete	$	89	$	24		—	$	65
Customer Relationships		2,913		296		—		2,617
Management Agreement		1,396		270		1,126		—
Trade Name		17		—		—		17
	$	4,415	$	590	$	1,126	$	2,699

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Goodwill and Intangible Assets (Details) (USD $)	12 Months Ended
	Sep. 30, 2012	Sep. 30, 2011
Goodwill and Intangible Assets [Abstract]
Impairment of intangible assets	$ 101,000	$ 1,126,000
Impairment of goodwill	173,000
Summary of finite-lived intangible assets [Abstract]
Cost	4,415,000	4,415,000
Accumulated Amortization	984,000	590,000
Loss on impairment of Intangible assets	1,227,000	1,126,000
Net Book Value	2,204,000	2,699,000
Amortization of intangible assets	394,000	537,000
Amortization expense of finite-lived intangible assets [Abstract]
Amortization expense of finite-lived intangible assets for fiscal year 2013	393,000
Amortization expense of finite-lived intangible assets for fiscal year 2014	376,000
Amortization expense of finite-lived intangible assets for fiscal year 2015	359,000
Amortization expense of finite-lived intangible assets for fiscal year 2016	340,000
Amortization expense of finite-lived intangible assets for fiscal year 2017	322,000
Amortization expense of finite-lived intangible assets after fiscal year 2017	414,000
Non-Compete [Member]
Summary of finite-lived intangible assets [Abstract]
Cost	89,000	89,000
Accumulated Amortization	48,000	24,000
Loss on impairment of Intangible assets	41,000	0
Net Book Value	0	65,000
Estimated useful life	5 years
Customer Relationships [Member]
Summary of finite-lived intangible assets [Abstract]
Cost	2,913,000	2,913,000
Accumulated Amortization	662,000	296,000
Loss on impairment of Intangible assets	60,000	0
Net Book Value	2,191,000	2,617,000
Customer Relationships [Member] | Minimum [Member]
Summary of finite-lived intangible assets [Abstract]
Estimated useful life	3 years
Customer Relationships [Member] | Maximum [Member]
Summary of finite-lived intangible assets [Abstract]
Estimated useful life	10 years
Management Agreement [Member]
Summary of finite-lived intangible assets [Abstract]
Cost	1,396,000	1,396,000
Accumulated Amortization	270,000	270,000
Loss on impairment of Intangible assets	1,126,000	1,126,000
Net Book Value	0	0
Estimated useful life	5 years
Trade Name [Member]
Summary of finite-lived intangible assets [Abstract]
Cost	17,000	17,000
Accumulated Amortization	4,000	0
Loss on impairment of Intangible assets	0	0
Net Book Value	$ 13,000	$ 17,000
Estimated useful life	5 years

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Stock Option Plans

12 Months Ended

Sep. 30, 2012

Stock Option Plans [Abstract]

Stock Option Plans

13. Stock Option Plans

As of September 30, 2012, there were stock options outstanding under the Company's 1995 Stock Option Plan, Second Amended and Restated 1997 Stock Option Plan, 1999 Stock Option Plan and the 2011 Company Incentive Plan.  All four plans were approved by the shareholders.  The 1995 Stock Option Plan and the 1999 Stock Option Plan have expired, and no further options may be granted under those plans.  During fiscal 2009, the Second Amended and Restated 1997 Stock Option Plan was approved by the Board and shareholders to make an additional 592,000 options available for granting and as of September 30, 2012 there were 700,840 shares available for issuance under the Second Amended and Restated 1997 Stock Option Plan.  As of September 30, 2012 there were 500,000 shares available for issuance under the 2011 Company Incentive Plan.  The plans granted specified numbers of options to non-employee directors, and they authorized the Compensation Committee of the Board of Directors to grant either incentive or non-statutory stock options to employees.  Vesting periods are established by the Compensation Committee at the time of grant.  All stock options outstanding as of September 30, 2012 were non-statutory stock options, had exercise prices equal to the market price on the date of grant, and had expiration dates ten years from the date of grant.

A summary of stock option activity is as follows:

	Year Ended September 30
(Number of Options in Thousands)	2012			2011
Number of options outstanding:
Beginning of year		301			388
Granted		1,747			—
Exercised		—			(12	)
Terminated		(301	)		(75	)
End of year		1,747			301
Number of options exercisable at end of year		1,658			255
Number of options available for grant at end of year		1,201			731
Weighted average option prices per share:
Granted during the year	$	.41		$	—
Exercised during the year		—			.40
Terminated during the year		—			1.26
Outstanding at end of year		.38			.95
Exercisable at end of year		.40			1.00

Stock options outstanding as of September 30, 2012 were as follows (number of options in thousands):

Range of Exercise Prices		Number Outstanding	Weighted Average Price		Number Exercisable	Weighted Average Price		Average Remaining Life (Years)
Under $1.00		1,747	$	.38	1,658	$	.40	4
$	1.25 to $2.39

As of September 30, 2012, the aggregate intrinsic value of outstanding stock options and exercisable stock options was $0.19.  There were no stock options exercised during the year.

The average fair value of stock options granted was estimated to be $0.26 per share in fiscal 2012.  No stock options were issued in fiscal year 2011.   This estimate was made using the Black-Scholes option pricing model and the following weighted average assumptions:

	2012			2011
Expected option life (years)		5.0
Expected stock price volatility		76	%
Expected dividend yield		—	%
Risk-free interest rate		.91	%

Stock-based compensation expense attributable to stock options was $422,000 in fiscal 2012 and $8,000 in fiscal 2011.  As of September 30, 2012, there was approximately $46,000 of unrecognized compensation expense related to unvested stock options outstanding, and the weighted average vesting period for those options was 2.5 years.