Last week we discussed NAPEO’s support of the Small Business Efficiency Act and how this directly ties into the President’s recent State of the Union address, and the overall American economy goals for the near future. To elaborate on the Small Business Efficiency Act, and how this will benefit Small Businesses and PEO, let’s review!
What is the Small Business Efficiency Act?
The Small Business Efficiency Act is a federal bill that will help small business owners ensure their companies are compliant with complex federal payroll tax responsibilities. If passed, The Small Business Efficiency Act (H.R. 2466), will provide clarity around the co-employment model that many PEOs and small businesses operate within.
How will Small Businesses and PEOs benefit?
- The Small Business Efficiency Act will enable companies such as PEOs and employee leasing solutions to continue withholding and remitting federal payroll taxes on behalf of their clients.
- Small business owners can focus on what they do best and not be forced into adding “administrative headaches” to their workload.
- PEOs can continue to do what they do best: administrative tasks!
- Small businesses can focus on growing their businesses and hiring new employees.
PEOs serve as one of the most efficient outsourcing options for businesses within many different industries. A PEO can provide a single source for outsourcing payroll, workers’ compensation, human resources, employee benefits administration and other administrative tasks. This helps employers at small to medium-sized companies gain efficiencies in non-core business functions–all while saving money and taking advantage of economies of scale!
In many instances, PEOs and small businesses make the perfect partners, providing the improvements listed above that are instrumental in gaining a competitive advantage. Many PEOs and small business clients develop long-term relationships because they allow clients to reduce costs and devote more time to revenue generating activities.