Penalties for Maine Retirement Savings Program Enrollment Failures Could Change

The penalties imposed on employers for failure to enroll covered employees in the Maine Retirement Savings Program would be altered under a bill now before the state Senate.

On June 24, 2021, Gov. Janet Mills (D) signed into law a measure creating the Maine Retirement Savings Program. The law requires each covered employer to allow its covered employees to decide whether or not to contribute to a payroll deduction Roth IRA by automatically enrolling them but with the opportunity to opt out. Covered employees who opt out are automatically reenrolled at regular intervals but have the opportunity to opt out again. 

The law set the following deadlines: 

• April 1, 2023: a covered employer with 25 or more covered employees must offer the program to them; 
• Oct. 1, 2023: a covered employer with 15 to 24 covered employees must offer the program to them; and
• April 1, 2024: a covered employer with 5 to 14 covered employees must offer the program to them.

SP 451, introduced in the Maine Senate on March 9, 2023, could extend the deadlines by which penalties for not enrolling covered employees without “reasonable cause” would be imposed. 
 

But while the bill would extend the deadlines, it also would increase some penalties that would be imposed. 
  

Status. SP 451 was referred to the Senate Committee on Health Coverage, Insurance and Financial Services on Mar 16, 2023.