New Jersey’s long-delayed state-sponsored retirement plan for private employers and their workers now has its first executive director with the recent appointment of Todd Hassler following a nationwide search for a leader to run the potentially $10 billion program.
Hassler will be tasked with implementing the New Jersey Secure Choice Savings Program to help approximately 1.7 million private-sector workers in the state, who do not now have access to employer-sponsored retirement plans, save for their future.
Hassler has more than two decades’ experience in both the public and private sectors analyzing employee benefit plans and most recently served as a senior investigator for the U.S. Department of Labor’s Employee Benefit Security Administration.
“Todd’s vast knowledge and wealth of experience in responsible oversight of employee benefit plans will be valuable assets in launching the Secure Choice Savings Program,” Andrea Spalla, assistant state treasurer and chair of the Secure Choice Savings Board, said after Hassler’s appointment was announced on Dec. 16.
“We’re excited to have him on board to lead this exciting new program that will help so many New Jerseyans save for retirement and plan for the future,” Spalla said.
New Jersey is one of 16 states to enact laws requiring employers to offer state-facilitated plans, although only seven have implemented fully operational programs thus far. The New Jersey law was signed by Gov. Phil Murphy in 2019, but the Secure Choice Savings Board responsible for launching the program did not hold its first meeting until late 2021 because of the pandemic.
Under the law, businesses in operation for at least two years with 25 or more employees are required to offer workers the option to participate in the New Jersey Secure Choice Savings Program through an automatic payroll deduction IRA. Employees determine the amount they want to contribute, as well as the investment option.
Employers retain the right to alternatively offer their own employer-sponsored retirement plan, or one provided through an employee leasing company, or professional employer organization. NJBIA, for example, offers member companies the opportunity to join with other employers in a Multiple Employer Plan (MEP) that offers a high-quality 401(k) and profit-sharing plan that is fiduciary-managed and customizable with low expense ratios.
The law does not require employers to make investments themselves or match employees’ savings. Private-sector workers’ retirement savings cannot be co-mingled with public funds, and the investments are overseen by the board and the fiduciaries, private financial institutions, and the other professionals it contracts with. The fiduciary-managed MEP offered by NJBIA also frees employers from the costs and headaches of running their own retirement plan.
The New Jersey Secure Choice Savings Program Act carries significant penalties for employers for noncompliance, ranging from written warnings in the first year of the program to up to $500 per employee in the fifth year of the program.
The law will not take effect until nine months after the Secure Choice Savings Board notifies the Treasury Department that the program has been implemented. The Department of Treasury has not yet provided the implementation timetable that triggers that nine-month countdown for employer compliance.