Bill > S4554

This bill allows state, municipal, and county governments to implement automatic enrollment in deferred compensation plans for their employees, which means workers would be automatically signed up to have a portion of their salary set aside in a retirement savings account unless they actively choose to opt out. The bill provides that employers can establish a default deferral percentage (the percentage of salary automatically saved) and can even include provisions for gradually increasing that percentage over time. For unionized employees, any automatic enrollment must be negotiated with the union representatives. The bill requires that employees must receive notice and have a reasonable opportunity to stop or adjust the automatic deferrals, and the plan must designate a default investment option for employees who do not make an active investment choice. The legislation applies to both state employees and employees of municipalities, counties, and authorities, ensuring that these public sector workers have an easier pathway to saving for retirement through a deferred compensation plan. Importantly, the bill treats these automatic deferrals as voluntary agreements, which protects both the employer and employee, and allows for flexibility in implementation across different types of public sector employers.

Government Affairs

https://www.njleg.state.nj.us/bill-search/2024/S4554