Bill > SB855

This bill modifies the Hawaii Retirement Savings Act to enhance and clarify the state's retirement savings program for private sector employees without employer-sponsored retirement plans. The bill redefines "covered employer" to include any business with employees, excluding government entities and employers that have already offered a retirement plan in the past two years. The key change is the shift from voluntary to automatic enrollment, meaning employers will now automatically enroll employees in the program unless they specifically opt out. The bill also removes the previous cap on annual program fees and expenses, allowing the board more flexibility in managing program costs. The board is given expanded powers to design, implement, and maintain the program, with a focus on encouraging participation, minimizing administrative complexity, and reducing costs. Employees will have a Roth IRA established for them by default, with the potential option to contribute to a traditional IRA. Employers who fail to enroll employees can face penalties of $25 per month for each unenrolled employee, increasing to $50 per month for continued non-compliance. The changes are designed to make retirement savings more accessible and easier for both employers and employees, with the program set to take effect on July 1, 2025.

Budget and Finance, Labor and Employment

https://www.capitol.hawaii.gov/session/measure_indiv.aspx?billtype=SB&billnumber=855&year=2025