The future of the Illinois Secure Choice Savings Program Act (Secure Choice) is uncertain following Governor Bruce Rauner’s amendatory veto which could make employer participation in the Secure Choice program optional.
The legislation, as enacted, makes participation in the Secure Choice program mandatory for covered employers that do not offer employees a qualified retirement plan. These employers are required to automatically withhold five percent of an employee’s compensation (up to the IRS annual maximum allowed for IRA contributions each year), unless the employee elects a different amount or opts out of the program entirely. Employers then remit those contributions to the Secure Choice program. The program is set to roll out in November 2018.
On August 14, 2018, Governor Rauner issued an amendatory veto to a bill that makes several technical changes to the program. The veto makes the Secure Choice program permissive, rather than mandatory. It is unclear whether the veto will stand or whether a majority of the Illinois Legislature will override it. A vote by the Legislature may not occur until November, when the body is scheduled next to be in session.
For more information, see our legal update here.