Chicago-based employment expert explains “Illinois Secure Choice”
Starting in May 2018, a new retirement plan called Illinois Secure Choice is being introduced in Illinois. For the first several months, this program will be voluntary, but beginning in November 2018, employers will be legally required to participate in this plan. However, many companies are still woefully uneducated or undereducated about this program.
“It is imperative that employers in Illinois become better acquainted with these changing retirement requirements,” says Rob Wilson, President of employment-solutions firm Employco USA, which is based in Chicago, IL and services a number of prestigious Illinois companies. “This is especially true right now, as big changes are coming with the Illinois Secure Choice Savings Program, which is a retirement savings plan that enables Illinois-based workers to save their own money through a regular payroll deduction.”
Here the employment expert outlines what Illinois employers need to know about Illinois Secure Choice:
- Voluntary Pilot Phase. “After several delays, the Illinois Secure Choice Savings Program is ready to launch its pilot phase in May 2018. Starting in May, employers that elect to voluntarily participate can begin to process employee payroll deductions and remit the funds to the retirement plan provider,” says Wilson.
- Employer Requirement Phase. “Starting in November 2018, employers will be notified of their legal requirement to participate in the program. Employers in Illinois that have 25 or more employees, have been in operation for at least two years, and that don’t offer a qualified savings plan (e.g., a 401(k) plan) will be forced to automatically enroll their employees into Secure Choice,” says Wilson.
“Employees can opt-out at any time. Employers will be responsible for dispersing information packets (provided by Secure Choice) to each of their employees. Employers will also facilitate enrollment of employees into Secure Choice, set up the payroll deduction process, and remit employee contributions to the plan provider. Employers who do not comply with the Illinois Secure Choice Savings Program Act may be subject to fines and penalties.”
Wilson concludes, “Instead of participating in Illinois Secure Choice, an employer can choose to offer an employer-sponsored plan, similar to ones that we have helped clients transition to. However, you need to move quickly in order to make sure you have your ducks in a row in time for these new deadlines.”
For more on this topic, please contact Rob Wilson at rwilson@thewilsoncompanies.com.