the-professional-employer-organization-industry-in-new-englandThe annual New England Leadership Council Forum of the National Association of Professional Employer Organizations (NAPEO) was held on September 27 in Edgartown, Massachusetts. Industry professionals from New England attended along with people from Virginia, New York, Indiana, Texas, New Jersey, and California. And there was good reason for them to do so.

In the past year, the Internal Revenue Service (IRS) released rules brought about as the result of the passage of the Small Business Efficiency Act (SBEA), which was signed by President Obama in December 2014.

As a result, several PEOs in attendance (including Genesis) have completed the application process and are awaiting IRS approval. Once approved, an IRS-certified PEO, called a CPEO, will add a level of confidence for businesses with whom they partner in a PEO relationship.

While some rulemaking challenges remain, the industry remains confident the collaboration of NAPEO and IRS officials will result in a program that will serve the needs of the IRS, the PEO industry, and most importantly, the small business community. Expect more information on this important program in the next few months.

Meanwhile in Massachusetts, House Bill 4563 (PEO Registration Bill) passed the Massachusetts House of Representatives on August 18, 2016. It is our hope that the many gains made in the last session will result in passage in the next session. Kerry Carruthers, a NAPEO spokeswoman, pointed out that the purpose of this initiative is:

  • To create a level, competitive playing field and diminish the ability of disreputable operations to distort the market or harm legitimate PEOs.
  • To provide statutory certainty and a firm foundation for law for the industry.
  • To resolve the most common legal issues that can arise in a co-employment environment.
  • To promote a common set of terms and provisions to make operations from state to state more seamless.

To learn more about this legislation, check out the article PEOs Ask State to Regulate Them by Requiring Registration.

The forum also addressed many issues that all business owners should be aware of. Included were discussions on timely and important issues including:

  • Fair Labor Standards Act (FLSA) exempt status changes effective December 1, 2016.
  • Earned sick leave laws.
  • Pay equity developments.
  • Joint employer issues.
  • Class waivers in arbitration.
  • NLRB developments.
  • EEOC religious discrimination initiatives.
  • Bullying in the workplace.

While space prohibits a detailed update on these issues here, contact us for more information on these time-sensitive issues.