On May 15, 2020, the State of Oregon will require all private-sector employers with one (1) or more employees (based in Oregon) to participate in the OregonSaves program. Open to everyone, the state-run retirement program is intended to make it easier for workers in Oregon to save for retirement by contributing a portion of their paycheck to a personal Roth IRA – an account that remains with them even if they change jobs. Employee enrollment is easy and automated with voluntary program participation and flexible investment choices.
The State’s goal is to make the account set up process clear and easy for employers. During the registration phase, it will monitor compliance by reaching out to businesses and providing technical assistance to meet deadlines and requirements. Once an account is set up, employers are responsible for its ongoing account maintenance, employee payroll deductions and IRA contribution submissions.
As of January 1, 2020, employers found to be non-compliant face civil penalties of up $100 per eligible employee (capped at $5,000 total per calendar year). The only exemption from program facilitation is if an employer-sponsored retirement plan is already being offered, which may make an employer eligible for a Certificate of Exemption.
Employers have an opportunity to present this additional mandate as a positive offering that encourages their employees to actively take responsibility for their own financial futures. OregonSaves makes a way for small businesses to compete with larger firms that provide company-sponsored plans allowing them to offer a qualified retirement program in a manageable way that helps attract and retain good employees – with zero employer fees.