The state legislature is studying a plan to create a new and potentially costly mandate on Connecticut employers.
Any employer not currently offering their employees a retirement plan would be required to help their employees participate in an IRA-style plan--including a state-run plan--or potentially face a penalty from the state.
Depending on how the legislation is crafted, employers could be made subject to new and significant liability as potential retirement plan fiduciaries.
Employers also would incur the administrative burden of facilitating employee participation in a plan. And as with all Connecticut taxpayers, employers would be partly responsible for the start-up costs of a state administered plan. What’s more, there could be additional liability if the state plan does not meet the guaranteed rate of return.
The legislative group considering this mandate, the Majority Leaders’ Retirement Security Roundtable, was expected to meet again in January. If you would like to learn more about the issue, sign up for “New Retirement Mandate” updates on this page.
Another task force
Another legislative task force has been working on a new program that would pay employees out on family and medical leave, traditionally an unpaid benefit that secures the jobs of employees that need to temporarily leave their employment to attend to medical issues.
Before these programs are voted on, lawmakers should stop to think about the effect their implementation would have on the state's competitiveness rankings.
Recent national surveys conducted by CNBC, Forbes, Kiplingers and others have pointed out that while Connecticut has a high quality of life and other positives, we also have higher costs and less favorable business conditions than most other states.
Whether the surveys are right or wrong, media coverage of them impacts our ability to attract businesses, and their jobs, to locate or relocate here.
Connecticut has many attractive qualities for several business sectors, despite our admittedly higher costs to do business. We will never be the cheapest place to do business, but we can still be the choice location.
State lawmakers should make concerted efforts to avoid adding to the costs and burdens faced by Connecticut employers.
For example, we do not always have to race to be the first (and only) state to enact more employer mandates such as the paid sick leave mandate. In addition to being costly, the paid sick leave law brought many administrative headaches for employers since it became law in 2012.
Holding the line on new costs, and making Connecticut competitive in the ease of doing business would go far in getting us off the bottom of everyone’s ranked lists.
For more information, contact CBIA’s Eric Gjede at 860.244.1931 or firstname.lastname@example.org.