May 04, 2021

Building Upon the Legal Foundation of the PEO Industry

What is the mission & purpose of NAPEO's Legal Advisory Council (LAC)?
The overarching purpose of the LAC is to educate and improve PEOs nationwide. We do this by evaluating existing or pending state and federal legislation and regulations that impact the PEO industry and providing that information to members and other NAPEO committees, such as the State and Federal Government Affairs committees. None of this would be possible without the active participation and collaboration of every member of the LAC.

What are the most important issues the LAC is working on right now?
2020 brought with it more new laws and complex regulations than any other year I can think of. The Coronavirus Aid, Relief, and Economic Security (CARES) Act, the Families First Coronavirus Response Act (FFCRA) with the Payroll Protection Plan (PPP), the Consolidated Appropriations Act (CAA), and the American Rescue Plan Act (ARPA) are all complex and overlapping laws that directly affect PEO clients in a variety of industries throughout the nation. Following these developments and educating members about the evolution and impact of these laws is the LAC’s 2021 priority. I suspect that will be a full-time job in 2021, as it was in 2020.

How does the LAC identify issues important to the PEO industry?
The LAC is made up of active members of the NAPEO community. Many have areas of specialty—some are litigation experts, some are Employment Retirement Income Security Act (ERISA) gurus, and some are exceptionally well-versed in state laws. We ask our subject-area experts to share information they believe is timely and relevant to the industry. LAC members are incredibly generous with their time and talent. These bright attorneys are willing to share their knowledge collaboratively. This benefits every member of the PEO industry, and, by extension our clients and worksite employees.

Can you describe a key success for the industry?
The Certified PEO (CPEO) legislation was a topic of discussion by the LAC for years before it came to fruition. Along with other NAPEO members, staff, and lobbyists, LAC members worked with Members of Congress to bring the law to fruition and give the entire industry credibility with the IRS.

What are the emerging legal issues that you see on the horizon?
The most pressing emerging issue for PEOs is the continued evolution of the federal legislation that began in March 2020. In the past year, beginning with the Coronavirus Preparedness and Response Supplemental Appropriations Act and continuing—most recently with the American Rescue Plan Act—there have been half a dozen major pieces of legislation, each more complicated than the last. Helping clients understand their employees’ leave rights, employer safety obligations, PPP loan availability, and opportunities for tax credits has made PEO services more valuable than ever. Every time a state or federal administration changes, new relationships must be developed. This is challenging but creates an opportunity for us to continue teaching legislators and leaders about the PEO model and the consistency and assurances we offer.

What would you like NAPEO members to know about the work the LAC does?
Two things: First, although the results of the LAC benefit PEOs nationwide, the members who do the work to generate these results often do so quietly and without any expectation of reward. Second, the LAC has always had exceptional and dedicated leaders on the NAPEO staff. Bill Shilling, Farrah Fielder, and Nick Kapiotis, NAPEO’s current general counsel, all deserve recognition for providing direction, guidance, and support to LAC members. Without these great coaches, our team would not be successful.

Read in NAPEO's PEO Insider May 2021 issue.