Dental practice owners and other employers who have 5 to 50 employees and do not have a retirement plan in place will be required by state law to enroll their employees in CalSavers no later than June 30, 2022. CalSavers is a Roth IRA voluntary retirement savings program for California workers who do not have access to a retirement plan at work.
Employees may choose not to participate or to reduce or increase their payroll contributions, but employers must facilitate initial enrollment and send payroll deductions to CalSavers for each employee who does not affirmatively opt out of participating in the program.
California employers with 51 to 100 employees were required to register by June of this year, and employers with more than 100 employees had until Sept. 30, 2020, as CDA first reported in June 2019.
Employers do not pay any fees for participating in the program, and they are prohibited from contributing to employee accounts.
Established through 2016 legislation as the CalSavers Retirement Savings Trust Act, the program is intended to be a “simple and effective way for employees to save.” CalSavers accounts have a default savings rate of 5% of the employee’s gross pay, but employees can change their rate at any time.
Eligible employers may be fined under the Unemployment Code if they do not currently offer a retirement savings plan and fail to allow their eligible employees to participate in CalSavers.
Small employers can register early without penalty to allow employees to begin saving now.
The CalSavers registration deadline and other upcoming and past compliance deadlines for dental practices are available in one place on CDA’s website for easy reference.
Visit the ‘Are You in Compliance?’ webpage for details about deadlines related to required notices, continuing education, new permit requirements for general anesthesia and sedation and more.