Posted: September 28, 2020 |
The first registration deadline for enrollment in California’s mandatory CalSavers Retirement Savings Program is September 30, 2020. The deadline applicable to your business depends on the average number of employees you reported to the Employment Development Department on your previous four DE9C filings:
- Businesses with more than 100 employees: September 30, 2020
- Businesses with more than 50 employees: June 30, 2021
- Businesses with more than 5 employees: June 30, 2022
The CalSavers Program is a new state-sponsored retirement savings program that applies to all employers in California with at least five employees who do not already offer a workplace retirement plan. Once registered in the Program, employers serve a limited role in managing and administering the Program. Employers must add their employees to the Program and submit participating employees’ contributions via payroll deduction. Employers will incur no fees to facilitate the Program and are not considered fiduciaries of the Program. Furthermore, employers are not permitted to make contributions to employee retirement accounts managed through CalSavers.
After an employer registers for CalSavers, employees will receive notification from CalSavers directly on how to manage their savings and investment options. Employees who wish to opt out of the Program must do so by contacting CalSavers directly.
Employers who fail to register for the CalSavers Program within the applicable deadlines may be subject to fines ranging from $250 per eligible employee if noncompliance extends 90 days or more after being served with a notice of noncompliance, and if found to be in noncompliance 180 days or more after the notice, an additional penalty of $500 per eligible employee may be imposed.
Employers may register their business on the CalSavers website here.
This blog is not meant to provide specific legal advice. For advice specific to your business, please contact any of the employment attorneys in our Employment Practices Group.