As of July, Oregon is the first state to institute a state-sponsored retirement plan for workers whose employers’ don’t offer a plan, which accounts for about one-third of Oregon workers, according to The Register-Guard. The Legislature first approved the state-run program in 2015, when other states like California and Illinois were also considering similar plans. But this May, Congress rescinded an Obama-era “safe harbor” on the plans that simplified the paperwork and compliance rules. In return, all states besides Oregon halted their plans. Oregon had their first businesses enroll in the state-sponsored program, OregonSaves, this July.
By January 1, every employer with over 100 workers that doesn’t offer a retirement plan already will have to join and oversee payroll deductions. Over the next two years, small businesses will be brought on board.
“The vast majority of our small-business members opposed (the original legislation) and continue to oppose the idea that the state should mandate participating in a program they never asked for,” said NFIB lobbyist Anthony Smith. OregonSaves creates an administrative headache for small businesses, which often don’t have the departments to handle oversight. The program could be challenged on several legal grounds, but until then, employers will have to prepare for an added administrative responsibility.
