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Strength, Agility, Endurance

As far as business and service models go, PEOs are very diverse. With options including PEO, ASO, and HR consulting, PEOs, like Olympic decathletes, don’t have to do the same thing all the time, thus building overall strength, agility, and endurance.

The diversity and options don’t end, there, either. Within each service line, options abound: delivery options, service options, a la carte options. These options mean PEOs can serve a wider range of clients, giving them choices for serving companies that may not perfectly fit PEO or that may want something different. Just as the decathlete can sprint, jump, throw, and run long distances, the PEO can meet a variety of client needs with no sweat.

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Building the Business Case

What do we mean when we talk about building a business case? The phrase carries a multitude of interpretations and definitions, and there is no universal approach to guide us. I’ve trained large numbers of PEO sales professionals about how to incorporate this business case approach into their sales processes, yet I have never really tried to define it, until now. Building the business case in PEO sales is one way of strengthening the PEO model, which is the theme of this issue’s feature. Historically, there have been two approaches to the PEO sale.

Legal Currents

2014 NAPEO Chairperson President and CEO Oasis Outsourcing West Palm Beach, Florida

Flat, Phillips, or square head screwdriver? Seven iron, eight iron, or nine iron golf club? PEO, ASO, or HR consulting client service agreement (CSA)? Picking the right tool for the job is critical in getting the job done efficiently, effectively, and to minimize risk. Understanding the uses of each, the circumstances where selecting one over the other is important, and the job to be done is the key to selecting the right tool. A wrong decision can lead to a stripped screw head, a poor shot, or increased liability risk.

Human Resources

Practical Considerations for HR When Expanding HRO Offerings

Whether you began as a PEO, ASO, BPO, or some other O, many organizations have seen the competitive market advantages of expanding their business models to allow for different forms of what is typically considered the human resources outsourcing (HRO) umbrella. In a PEO relationship, there is contractual co-employment (as well as co-employment by virtue of common or statutory law), thus creating an employee-employer relationship. In an ASO/BPO model, there is no employee-employer relationship, shifting much of the liability to the client. While there is certainly a large difference between the two outsourcing solutions, there is overlap when it comes to the services they provide to their clients. It is not surprising that both PEOs and ASOs have moved toward offering HRO products, because expanding the business model offers increased options to prospects, much of the current back office is already in place, and these companies have the necessary skill sets to support it.


Final Pay-or-Play Rules

On February 12, 2014, the Department of the Treasury and the Internal Revenue Service (collectively, the Service) issued widely anticipated final regulations under Internal Revenue Code (Code) Section 4980H—the so-called employer mandate, or pay-or-play, provision of the Affordable Care Act (ACA). Proposed regulations were released on December 28, 2012, and, in July 2013, the Service announced that this requirement would become effective in 2015 (not 2014, as was expected). These final regulations are, of course, potentially of enormous significance to PEOs and their employer clients, and there are a number of changes—and some important transition relief—that deserve attention.


PEO Spotlight

The Forces that Created NAPEO’s Educational Programs Stephanie Oetjen

Three principles guided the founders of the National Staff Leasing Association (now NAPEO) when the association was formed in 1984: working proactively with regulators and lawmakers to establish a legal foothold for the nascent industry; educating members about professional operating standards, fiscal responsibility, and ethics; and creating a culture of information exchange and professional networking.

NAPEO Notebook

Lots of Good News for PEO Industry Patrick J. Cleary

From February 10 through March 21, I logged something like 30,000 miles, including a few trips to Florida, a few to Texas, and one to California. Another trip to California ended up getting scuttled due to one of the many snowstorms we endured this winter.

NAPEO Advisor

Whistleblower Protections, I-9 Form, Overtime Exemption, Religious Attire, OSHA Injury Log Questions William J. Schilling, Esq.

Q. I heard that the whistleblower protections of the Sarbanes-Oxley Act (SOX) have been expanded. Is that correct? A. Yes. In a 6-3 decision in Lawson v. FMR LLC

The Inside Word

Examining, Evaluating, and Recalibrating NAPEO’s Three-Year Strategic Plan Mark C. Perlberg

“Plan the work; work the plan” is good advice for running a business. This maxim, however, does not mean the plan should be written in stone. As we in the PEO industry know from our own businesses, any plan needs to be flexible enough to allow for periodic evaluation and adjustment.

Global Insights

Saluting America’s Job Creators Thomas J. Donohue

Small businesses are the backbone of the U.S. economy. They represent more than 99 percent of all employers, creating two-thirds of all new jobs and accounting for nearly half of private sector output. Each year, the U.S. Chamber recognizes America’s most exceptional small businesses. Here are the regional finalists for the 2014 Dream Big Small Business of the Year.

Capitol Comment

House Ways and Means Committee Chair Supports the SBEA Thom Stohler

The Small Business Efficiency Act (SBEA)—NAPEO’s top federal legislative priority— has been included in the tax reform discussion draft. So, what exactly does that mean? The short answer: It’s a good thing.


NAPEO’s First Chapter: Texas, Born of Necessity Eddie Heinemeier and Bill Lange

It is said, “Necessity is the mother of invention,” and so it was for NAPEO’s first state chapter—Texas. The National Staff Leasing Association (now NAPEO) was formed in 1984 through the leadership of several industry visionaries and early adopters, including Kent Ahlswede, T Joe Willey, and Gordy Brown.


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