Bill > A4562

This bill allows state, municipal, and county employers to implement automatic enrollment in deferred compensation plans, which are retirement savings programs where employees can voluntarily defer a portion of their salary. The legislation enables employers to automatically enroll employees in these plans with a default percentage of salary deduction unless the employee actively chooses to opt out or select a different deferral rate. For unionized workforces, the automatic enrollment terms must be negotiated with the majority union representative. The bill requires that employees receive notice and a reasonable opportunity to adjust or stop the automatic salary deferrals, and allows employers to establish periodic escalation of deferral percentages and periodic reenrollment of employees. Additionally, the legislation mandates that employers designate a default investment option for employees who do not make an affirmative investment election. The bill applies to both state employees and employees of municipalities, counties, and related authorities, providing flexibility for public sector employers to encourage retirement savings through a streamlined enrollment process while preserving employee choice.

Government Affairs

https://www.njleg.state.nj.us/bill-search/2024/A4562