Labor and employment partner Brian Nugent in Denver participated in a Q&A with investment bank firm Delancey Street Partners, LLC (DSP), where he spoke broadly about his work with professional employer organizations (PEOs) and staffing providers, including his experiences as Chief Legal Officer at Outsource International and Advantech before joining Akerman. Recognized as one of the top advisers in the PEO industry, Nugent also gave a brief lesson on how the PEO model has evolved over time and the top legal issues that PEO providers need to understand.
DSP asked: "What are some of the top legal issues today that PEO providers need to understand?"
Nugent answered: "Fundamentally, this depends on the maturity of the PEO. In the initial stages, the PEO must make sure that all processes are implemented including having the right client service agreements, secured banking relationships, setting up workers’ compensation, being able to provide a basic level of HR, etc. As a PEO evolves and gets big enough to have a master health plan, for example, there is a much longer list of items to check off such as complying with ERISA laws and not just state insurance laws. Then, being a multi-state employer, you need to be well versed in every state because a PEO grows as each client expands into new states and hires new employees."