In late August 2022, Governor Gavin Newsom signed Senate Bill (SB) 1126 into law, which expands upon the current CalSavers requirements to include any California employer with at least one employee, who is not the owner of the business. Previously, only employers with 5 or more employees were required to participate in the state-run program if they didn’t already offer an eligible retirement plan.
The new legislation goes into effect January 1, 2023, but these new eligible employers* have until December 31, 2025, before they are required to sponsor or participate in a retirement plan, or register for CalSavers.
If your small business now falls under the CalSavers mandate, California Payroll offers 2 solutions to help streamline your deductions process:
- If your company is planning on registering with CalSavers, we offer CalSavers Connect to simplify the CalSavers contribution process for employers.
- Rather set up a 401(k) plan for your employees? We partner with a variety of 401(k) providers that offer an assortment of plans to choose from. Once your plan is established, we offer 401(k) Connect, an integrated payroll and 401(k) solution that incorporates the payroll & administrative aspects of your 401(k) program into a streamlined product that handles all data communications and fund transfers on your behalf.
Looking to get a head start on meeting CalSavers compliance? Fill out this form to speak with a specialist on how California Payroll can simplify the process for you!
*SB 1126 updates the definition of an “eligible employer” to include employers with 1 or more employee, who is not the owner of the business, and excludes sole proprietorships, self-employed individuals, or other business entities that do not employ any individuals other than the owners of the business.