Skip to main content

You are here

Advertisement

Expansion of Illinois Secure Choice Program on Governor’s Desk

State Auto-IRA Plans

A measure that would expand the Illinois Secure Choice Savings Program, the state-run retirement plan for workers whose employers do not offer one, awaits the signature of Gov. J. B. Pritzker (D).

Rep. Will Guzzardi (D-Chicago) introduced H.B. 0117 in the House of Representatives on Jan. 13, 2021; the chamber passed the measure in a 106-2 vote on April 14. On the next day, Sen. Robert F. Martwick (D-Chicago) introduced it in the Senate, which passed it by a 42-52 margin on May 27. 

Expanded Scope

As originally enacted, employers with 25 or more employers had to comply; employers to which it applies and that have 500 or more were to enroll their employees by Nov. 1, 2018, and those with 25 to 99 were to do so by Nov. 1, 2019. H.B. 0117 changes the definition of “small business” for purposes of the program from meaning a business with 25 or fewer employees at any one time throughout the previous calendar year to five or fewer employees during any quarter of the previous calendar year. Consequently, the bill would expand the program so that Illinois employers that do not offer a retirement plan, have at least five employees and have been in business at least two years would be required to enroll their employees in the program. 

Enrollment and Payroll Deductions

H.B. 0117 states that employers would be required to:

  • automatically enroll in Illinois Secure Choice each employee who has not opted out of participation; 
  • provide payroll deduction retirement savings arrangements for such employees; and 
  • deposit, on behalf of such employees, those funds into the program. 

The measure says that small employers could, but would not be required to, provide payroll deduction retirement savings arrangements for each employee who elects to participate in Illinois Secure Choice.

Auto Increases

The measure also provides for automatic increases in contributions. It would establish annual, automatic increases to the contribution rates based upon a schedule provided for in rules up to a maximum of 10% of an enrollee’s wages. 

Deadlines

Under HB 0117, the deadline for employers with more than 15 employees but fewer than 25 to enroll them in the program would be no sooner than Sept. 1, 2022. The deadline for employers with at least five employees but not more than 15 would be no sooner than Sept. 1, 2023. 

Advertisement