On May 30, 2017, the Joint Committee on Labor and Workforce Development listened to testimony from the Professional Employer Organization (PEO) industry who wished to advocate for passage of An Act Relative To The Recognition and Registration of Professional Employer Organizations operating in the Commonwealth of Massachusetts. On July 6, the Committee voted the bill (H3159) out favorably.
Could this be the first step for Massachusetts to finally recognize what PEOs do for the small business community in the Commonwealth? It could be; but then again, I thought the Red Sox would win the World Series in 1967, 1975, and 1986 only to be disappointed. (In 2004, this 86-year drought came to an end.)
Colin Young, writing for the State House News Service, posted this excerpt the day after our May 30 hearing:
20 Years Later, PEOs Still Seeking Recognition On Hill
Lobbyists are renewing an effort to set standards for the regulation of professional employment organizations, a quest that began more than 20 years ago and was nearly resolved last session. “PEOs partner with small businesses because businesses need help managing increasingly complex employee-related matters such as health insurance, worker’s compensation claims, payroll, payroll tax compliance, and unemployment insurance claims,” Bob Burbidge, CEO of Genesis HR Solutions and a member of the National Association of Professional Employment Organizations (NAPEO), told the Joint Committee on Labor and Workforce Development Tuesday. “In short, PEOs operate as a small business’s human resources department.” Burbidge has been advocating for legislation to clarify the relationships between PEOs and businesses for more than 20 years. State House News Service archives include a March 1995 story about Burbidge testifying for a bill substantially similar to the one he pitched Tuesday. “I first heard about PEOs from Bob Burbidge probably close to 20 years ago, maybe a little more than 20 years ago,” Rep. Jay Kaufman said. “At the time I couldn’t even spell PEO, but he introduced them to me as a very interesting, vibrant, sort of new approach to business management in the commonwealth … times have caught up with their business concept, but state law hasn’t.” Kaufman supports a bill (H 3159) filed by Rep. Joseph Wagner that NAPEO says “defines and standardizes the roles of the parties, it also creates a level playing field within the industry and also between businesses that choose to use PEO services and those who do not.” NAPEO Director of State Government Affairs Melissa Kelly said Wagner’s bill is the same language as a bill (H 4563) that passed the House last year but did not get a vote in the Senate. More than 30 other states have already adopted a similar law, she said.
Our Takeaway
We believe 2017 could be the year that ends the PEO Value Proposition drought. While this journey began a mere 22 years ago for those of us in the PEO industry, the wait certainly pales in comparison to the Boston Red Sox. And like every Sox fan, for those who operate and partner with PEOs, hope does indeed spring eternal.
