New State-Mandated Retirement Plan Deadlines

By Hunter Laine

CalSavers is a new state retirement plan that will offer millions of people a way to start planning toward their retirement by contributing each pay period to their own Individual Retirement Account (IRA).

All California employers will need to register with CalSavers before their deadline, but registering does not necessarily mean enrolling. Every business has to register to either take part in CalSavers or opt into another retirement plan, such as a 401k plan, pocket sharing plan, step IRA, or simple IRA. CalSavers is generally for employers not currently sponsoring a workplace retirement plan. As opposed to other retirement plan options, CalSavers is lower cost to the employer but much more time consuming.

In order to register, you need only a state payroll ID number, an EIN #, and the legal entity name. Register here.

Deadlines for Registration:
  • September 30, 2020 – For businesses with over 100 employees
  • June 30, 2021 – For businesses with over 50 employees
  • June 30, 2022 – For businesses with 5 or more employees


You’ll notice that if your company has more than 100 full-time employees, you have one week to be sure to register with CalSavers! Failure to register within 90 days of your prescribed deadline will result in a $250 penalty for each full-time employee. And this penalty will continue to increase with time. The number of employees refers to all full-time employees over the age of 18 who have worked for you for more than 30 days. This includes temporary staff. 

If your business chooses to take part in the CalSavers plan, all employees are automatically enrolled unless they specifically opt out. Then, each pay period, employer’s must remit a portion (standard procedure starts at a 5% contribution) of the employee’s pay to their CalSavers account. The employee can choose to increase or decrease this amount if they would like. Each year an employee works, the amount to be remitted to their CalSavers account is automatically escalated. Beyond that, employers cannot make contributions to an employee’s CalSaver account. In addition, every two years, the employer must re-enroll all employees. If an employee previously chose to opt out, they will need to again at this point, or will be enrolled.

An employee does always have access to use the money in their CalSaver retirement account, but with penalty.  

Whether you’re interested in partaking or not, make sure you register with CalSavers by your deadline! For more information, go here.

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