The facts on SB 249 and why lawmakers should reject it

SB 249 requires employers to facilitate access to a government-run retirement savings program for their employees.

Who Does It Impact?

All employers with five or more full- or part-time employees who do not currently offer their employees access to a retirement savings plan.

Why Is SB 249 Bad for Connecticut?

  • Makes Connecticut less competitive: Several nationwide surveys already portray CT as a less than desirable place to do business. (CNBC: CT is #45 overall, #43 costliest place to do business.) Becoming the first state to implement this mandate will further that “bad for business” perception. 
  • Other states are removing mandates and lifting administrative burdens on employers, but this bill adds more: management and costs of additional payroll deductions, payment transfers, dealing with morale issues, and all aspects of employee enrollment and mandated biennial open enrollment periods.
  • Establishes a stateadministered retirement program in direct competition with Connecticut’s financial services sector businesses employing over 100,000 Connecticut residents.
  • No other state has such a plan and many have rejected it this year, including AZ, IN, MD, ME, MN, OH, WA, WV, WI. California is extensively studying a similar proposal, but it may never be implemented because of financial and legal concerns.
  • Creates a potential liability for state taxpayers by promising a guaranteed rate of return for plan participants.
  • Acknowledges the program will not be selfsustaining on launch date and that expenses needed to run the program may exceed the administrative cost allowance.

Bottom Line: SB 249 will make Connecticut less competitive with other states, make it harder to operate a business here, and put jobs in jeopardy by placing state government in direct competition with our excellent private-sector financial services industry.

For more information, contact CBIA’s Eric Gjede at 860.244.1931 | | @egjede

Filed Under: Employment Law

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