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CA Employer Mandate : Retirement Benefits for Employees

California has made it mandatory for employers with more than 5 employees to certify that they either offer retirement plans themselves, or have registered to participate in the CalSavers program by the following dates : 

Size of business / Deadline

  • Over 100 employees / September 30, 2020  (extended from original June 30 deadline due to Covid)
  • Over 50 employees / June 30, 2021
  • Five or more employees / June 30, 2022

Employer Provided Plans

Employers who choose to provide their own plans can choose to offer any of the following plans to their employees: 

  • 401(k)
  • Qualified pension (defined benefit) 
  • 403(a) or 403(b)
  • SEP
  • Simple IRA
  • 457(b)

State Managed Plans

For those who elect to offer the CalSavers Retirement Savings Program, it is an automatic enrollment payroll deduction IRA program.

  • "CalSavers is a completely voluntary retirement program for employees. Savers can participate through their employer or on their own. Savers may choose their contribution rate, change their investments, or opt out (and opt back in) at any time;or, savers can stick with the standard account settings." 1
  • CalSavers is funded through participant fees. 

If you meet or will meet the requirement for offering an employer-sponsored plan, consider your plan offerings carefully. Consider both your own costs and the value to your employees as each plan offers different levels of benefit and can impact your employee retention and hiring policies. 

1 Per CalSavers website https://employer.calsavers.com/home/employers/program-details.html?language=en#