Trim the root ends of the pearl onions and place them in boiling water for 2 minutes. Drain and rinse with cold water. Pinch the stem end to remove the peeled onion. Set aside.
In a large skillet, melt the butter over medium-low heat. Whisk in the flour and keep whisking until you get a light golden color.
Gradually add the milk while whisking continuously until the mixture thickens, about 2-3 minutes.
Add the frozen peas and the prepared pearl onions to the skillet. Let it simmer for 5-7 minutes, or until the peas are tender.
Season with kosher salt and black pepper. If you like, stir in a pinch of nutmeg and a splash of heavy cream.