California Gov. Gavin Newsom signed a bill that makes the $273 million CalSavers Retirement Savings Program, Sacramento, available to employees at the smallest businesses.
The new law, signed by Mr. Newsom on Aug. 26, makes CalSavers available to California workers in companies with at least one employee who is not also the business owner.
CalSavers is a defined contribution plan for workers in the private sector in California who do not have access to a retirement plan sponsored by their employers.
The new companies now covered by the program have until Dec. 31, 2025, before they will be required to register with CalSavers. In the past, only employers with five or more employees were covered the program.
"This bill ensures the smallest employers will no longer be excluded from a valuable tool for employee recruitment and retention," California Treasurer Fiona Ma said in a statement..
More than 106,000 employers have joined CalSavers since its inception in 2019. Most of the employers have fewer than 50 employees.
“We’re thrilled that hundreds of thousands more workers will have access,” said Katie Selenski, CalSavers’ executive director, in an email.
The expansion will simplify compliance for California employers so small businesses that hover around the former five-employee threshold will no longer “go in and out of eligible status as their size fluctuates each year,” Ms. Selenski said.