All About PEP Plans for Small Businesses

According to the U.S. Bureau of Labor Statistics, only 68% of private-industry nonunion workers have access to retirement benefits, and businesses with under 100 employees are less likely to offer retirement plans than larger companies.
The Department of Labor is aiming to reverse this trend with pooled employer plans (PEPs), which can make it easier for small businesses to provide their employees with retirement benefits.
A pooled employer plan is a type of multiple-employer 401(k) retirement plan that allows unrelated businesses to participate in one plan managed by a pooled plan provider (PPP).
Introduced as a part of the Setting Every Community Up for Retirement (SECURE) Act in 2019, pooled employer plans are designed to benefit employers by reducing the administrative and fiduciary responsibilities relating to the plan, which — as a business owner — means fewer hours spent reviewing your plan's investments and more time spent running your business.
Prior to the SECURE Act’s passage, employers generally could only participate in multiple employer plans (MEPs) if they shared common factors (industry, geographical area, etc.) with other businesses participating in the plan.
The fiduciary oversight of a PEP falls on the pooled plan provider rather than the employer. And although each PPP may set its own eligibility requirements, businesses joining a PEP benefit plan do not need to operate in the same industry or geographical area.
We know that no business is the same, so when you work with Farm Bureau you can rest assured knowing you’re getting individualized recommendations tailored to fit the needs of your employees and your business.