A bipartisan bill that would allow employers to automatically re-enroll employees who previously opted out of retirement plans has been reintroduced in the Senate.
The Auto Reenroll Act of 2023, which was introduced Wednesday by Sen. Bill Cassidy, R-La., ranking member of the Senate Health, Education, Labor, and Pensions Committee; and Sen. Tim Kaine, D-Va., would modify safe harbors in the Employee Retirement Income Security Act and the Internal Revenue Code to permit plan sponsors to re-enroll non-participants at least once every three years, unless the individual affirmatively opts out each time.
"Auto-reenrollment puts workers in the better position to prepare for retirement while staying in control of their financial decisions," Mr. Cassidy said in a news release.
Citing March 2022 data from the Bureau of Labor Statistics, the lawmakers noted that only 75% of private-sector workers who have access to employer-sponsored retirement plans participate.
"Many Americans have the option to enroll in employer-sponsored retirement plans, but they do not take advantage of this benefit and miss out on critical retirement contributions from their employers," Mr. Kaine said in the news release. "I'm proud to introduce this bipartisan bill to help more Americans take advantage of the retirement benefits offered to them and be on better financial footing."
Mr. Kaine originally introduced the bill in February 2022 during the previous congressional session, but it did not move.
Of note, SECURE 2.0, a comprehensive retirement security bill Congress passed in December, included a provision to require all new 401(k) and 403(b) plans starting in 2025 to automatically enroll new employees in their plan, unless they opt out.