Multiple employer plans could be a more viable option for smaller employers and service providers under bipartisan legislation introduced Thursday in the House and Senate.
Unlike multiemployer plans, which serve employers in a specific industry and typically are collectively bargained and managed, a multiple employer plan is adopted by two or more unrelated employers that do not want the administrative burdens and fiduciary responsibilities of sponsoring a plan themselves. The design's adoption has been held back by conflicting regulatory guidance.
The proposed Retirement Security Act of 2015 would reduce employers' cost and complexity of sponsoring retirement plans and create incentives for automatic enrollment. The bipartisan proposal was introduced in the House by Rep. Vern Buchanan, R-Fla., and Ron Kind, D-Wis., and in the Senate by Susan Collins, R-Maine, and Bill Nelson, D-Fla.
“As an employer myself for over 30 years, I have seen firsthand how costly and complex it can be to establish retirement plans such as 401(k)s. Government should be encouraging employers to do right by their employees and help them save for retirement — not discouraging them,” Mr. Buchanan said in a statement.