This bill allows the State, municipalities, and counties in New Jersey to implement automatic enrollment for their employees in deferred compensation plans. It establishes that employers can defer and deduct a specified percentage from an employee's salary unless the employee opts out or chooses a different percentage. For municipalities and counties, the automatic enrollment is optional, while for the State, it is mandatory for employees hired after the first January following the bill's enactment. The bill also mandates that if an automatic enrollment arrangement is in place, a default investment must be designated for the employees' deferred salaries unless they make an affirmative investment choice.

Additionally, the bill requires that employers whose employees are represented by a union negotiate the terms of the deferred compensation plan with the union, including aspects such as automatic enrollment and default deduction percentages. If no agreement is reached, employees represented by the union must affirmatively elect to participate in the plan. The bill also extends these provisions to employees of State institutions of higher education eligible for the New Jersey State Employees Deferred Compensation Plan. Overall, the legislation aims to streamline participation in deferred compensation plans while ensuring that employees have the opportunity to make informed choices regarding their contributions.

Statutes affected:
Introduced: 43:15B-1, 52:18A-165