3 Things PEOs Need to Know Before You PEP Your MEP
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In today’s competitive marketplace, a robust, well-managed retirement plan is a critical part of any employee benefits package, offering significant value to both employers and employees. For Professional Employer Organizations (PEOs), providing these plans for your member clients can be a game-changer. Not only can a strong retirement plan increase the attractiveness of your service offerings overall, it also can help your member clients attract and retain top talent.
As a PEO, you may already have clients who are part of a multiple employer plan (MEP). By allowing multiple employers with a common connection (such as being part of the same industry or association), these retirement plans offer cost savings and reduced administrative burdens by pooling resources and sharing plan management responsibilities.
However, there’s a further layer of customization for these retirement plans that many PEOs are finding particularly valuable for their member clients: “PEPing your MEP,” or transitioning your MEP to a pooled employer plan (PEP).
PEPing your MEP offers significant benefits, including reduced fiduciary responsibility, simplified administration, and broader participation guidelines and flexibility. According to Scott Holechek, vice president, institutional sales, Ameritas retirement plans, the flexibility of the PEP structure is one of the most powerful reasons why PEOs have been embracing PEPs. Learn more about how Ameritas offers tailored retirement plan options for PEOs, including PEPs.
“PEPs allow unrelated employers to join a single retirement plan without needing a common nexus, like an industry or association link,” Scott explains. “This flexibility makes PEPs accessible to a wider range of employers, enabling more businesses to offer retirement benefits to their employees. For PEOs looking to expand their client base, the inclusivity of pooled employer plans is extremely beneficial.”
Since PEPs first became available to employers in 2021, their popularity has steadily grown. According to the Center for Retirement Initiatives, as of December 2023, approximately 39,000 employers had adopted a PEP, with PEPs accumulating $9.41 billion in assets and surpassing one million participants.
How to PEP your MEP successfully
To set up a pooled employer plan or make the transition from MEP to PEP, it’s important to find the right provider for your specific needs. Here’s what to keep in mind.
1. Choose a partner with expertise and experience
Working with a partner who has extensive experience in managing both PEPS and MEPS is crucial to help ensure you make the right decisions for you and your member clients.
“At Ameritas, we have over two decades of experience in this marketplace, giving us a unique advantage in understanding the complexities and nuances of multiple employer plans,” explains Chris Miller, director of multiple employer plans for PEOs and associations, Ameritas retirement plans. “We’re experts in this space, and we can help make sure you receive a truly personalized solution.”
2. Ensure strict compliance with regulations and fiduciary responsibilities
Understanding the regulatory landscape and fiduciary responsibilities is essential for a successful transition. PEOs must ensure that their plans comply with all relevant regulations and that fiduciary duties are appropriately managed. Ameritas can help PEOs navigate the fiduciary aspects of PEPs, offering options to either retain or outsource fiduciary responsibilities, depending on your preferences and needs.
3. Insist on software integration and technology that works for you
Effective technology and seamless integration with existing systems are critical for the efficient management of PEPs, explains Scott. “Ameritas’s technology platform is designed to be highly efficient for multiple employer plans, ensuring smooth operations for worksite employers and employees alike. We know how important integration is, and we’ve made the investment to ensure we can meet the evolving needs of PEOs throughout the marketplace.”
Currently, Ameritas is fully integrated with PRISM HR, an HR and payroll software platform designed specifically for PEOs and payroll bureaus and is in the process of fully integrating with iSolved’s human capital management platform.
Why Ameritas is a good partner for PEPing Your MEP
Ultimately, the most important success factor to PEPing your MEP is working with a provider who cares about you. At Ameritas, our personalized, high-touch approach ensures that PEOs receive the attention and service you need for a successful transition.
“We’re truly boutique,” explains Chris. “We do what we do extremely well, and we do it with a very focused segment of the industry. You know you will get the attention you need when you work with us.”
Streamline retirement planning
Contact us to learn how you can help your member clients PEP their MEP while ensuring compliance and efficiency. Tell us a little more about your needs and we’ll be in touch.