State Bills Would Redefine ‘Covered Employer’ and ‘Covered Employee’

Legislation is pending in two states to adjust the definition of “covered employer” and “covered employee” for purposes of state-sponsored retirement plans that cover private-sector employees whose employers do not offer a plan. 

Hawaii. Bills are before both the Hawaii House of Representatives and Senate that would adjust the definition of “covered employer” in the Hawaii Retirement Savings Act. 

Rep. Scott Saiki (D-Kakaako) on Jan. 20, 2023 introduced HB 379. Under Hawaii law, the definition of “covered employer” is any person who is in business in the state and employs one or more individuals. It also sets out those not included in the definition of “covered employer.” Current law says that among those not included in the definition are persons that have “been maintaining for all employees” such a plan; HB 379 would substitute offered or maintained for some or all employees at any time” for that language. 

The bill is before two House committees: Consumer Protection & Commerce, and Labor & Government Operations. 

Sen. Sharon Moriwaki (D-Waikiki) introduced SB 596, the Senate companion to HB 379, on the same day. The language is identical. The bill is before two Senate committees: Labor and Technology, and Ways and Means. 

Illinois. Rep. Charles Meier (R-Highland) has introduced HB 1147, a measure that would amend the Illinois Secure Choice Program Act to change the definition of “employer” so that it does not include volunteer fire departments. The bill is now before the House Rules Committee. 

In response to a question by ASPPA Connect, Meier noted that even though they are volunteers and not paid career rescue staff, volunteer firemen in his district receive some small payments for attending training and running on calls; many, he noted, don’t even cash them. He indicated that money is taken from even those small payments to be put into the retirement system, and that the resulting accounting can be burdensome.