Auto-Enrollment for Hawaii Retirement Savings Program Getting Closer
Automatic enrollment of eligible employees in the Hawaii Retirement Savings Program is closer to being put in place. Sen. Sharon Moriwaki (D-Waikiki) introduced SB2553, which would allow for automatic enrollment of eligible employees in the Hawaii Retirement Savings Program. Currently, employees would have to actively opt in to participate in the program, but would then be automatically enrolled. The bill has been recommended by the Senate Labor and Technology and referred to the Senate Ways and Means Committee, which held a hearing on March 1. The committee found that it would increase participation, align with laws of other states requiring automatic enrollment, and increase the program's viability by ensuring sufficient participants. The Department of Labor and Industrial Relations also supports the measure.
Published : a month ago by in Finance
Automatic enrollment of eligible employees in the Hawaii Retirement Savings Program is closer to being put in place.
Sen. Sharon Moriwaki (D-Waikiki) introduced SB2553 on Jan. 19, 2024. Under the bill, employees would no longer be required to opt in to participate in the Hawaii Retirement Savings Program but rather would be automatically enrolled. When the program began, one of the features that distinguished it from other states’ programs was that employees would have to actively opt in if they wanted to participate.
On Feb. 2, the Senate Labor and Technology recommended passage with amendments and referred the bill to the Senate Ways and Means Committee, which held a hearing on the bill on March 1.
In testimony to the committee, Hawaii Retirement Savings Board Chair William Kunstman said that the board “strongly supports this proposal to require employers to automatically enroll employees in the Hawaii Retirement Savings Program and allow employees to opt out instead of opt in to the program.” He continued that “There is an urgent need to provide a viable option for private-sector employers and workers to have access to a state-facilitated retirement savings plan.” Kunstman added that “Opt-out retirement plans also increase participation rates as too few workers would otherwise put away savings for retirement.”
The Ways and Means Committee on March 1 recommended that the bill be passed. Ways and Means Chair Donovan Dela Cruz (D-17) wrote in his March 1 message notifying Senate President Ronald D. Kouchi (D-8) of the committee’s action that the Ways and Means Committee found that “establishing automatic enrollment in the Hawaii Retirement Savings Program will increase participation, align Hawaii's law with laws of other states requiring automatic enrollment in similar savings programs, and greatly increase the viability of the program by ensuring a sufficient number of participants.”
The Senate passed SB2553 on March 5 and referred it to the House of Representatives. That body sent it to the House Labor and Government Operations Committee, which held a hearing on March 14.
In comments to the committee, Department of Labor and Industrial Relations Director Jade T. Butay said that the department also “strongly supports” the measure. Butay said that the DLIR believes that requiring automatic enrollment of employees into the program “is critical” to its feasibility.
The Labor and Government Operations Committee recommended that the bill be passed with amendments and has referred it to the House Finance Committee.