Opt-in Out, Auto Enroll in for Hawaii Program?

Employees would no longer be required to opt in to participate in the Hawaii Retirement Savings Program but rather would be automatically enrolled under legislation now before the Hawaii House and Senate. 

Sen. Sharon Moriwaki (D-Waikiki) introduced SB2553 on Jan. 19, 2024; Rep. Andrew Garrett (D-Manoa) introduced the House of Representatives version, HB2197, five days later on Jan. 24, 2024.

Opt Out, not Opt in

When the Hawaii Retirement Savings Program began, one of the features that distinguished it from its state counterparts was that employees would not be automatically enrolled; rather,  they would have to opt in to participate and be covered by the program. 

But the legislation now before the Hawaii legislature would bring enrollment in the Hawaii program in line with that of the programs put in place by its sister states. The bills would change the way employees are enrolled and instead require automatic enrollment, with employees able to opt out. 

Covered Employer

The bills also would redefine what a “covered employer” is for purposes of the Hawaii Retirement Savings Program. It would change the definition so that the term would mean any person who is in business in the state and has one or more individuals in employment. And “covered employer” would not include:

• the federal government;
• the state of Hawaii and its political subdivisions; or
• any person that has offered or maintained for some or all employees at any time during the preceding two years a tax-qualified retirement plan such as a 401(k), 403(b), or other plan established under the Internal Revenue Code.

Status 

HB2197 was referred to the House Finance Committee and the House Labor & Government Operations Committee; the latter is scheduled to hold a hearing on the bill on Feb. 1. SB2553 is before two Senate committees: Labor and Technology, and Ways and Means.