Supporters argue low wage workers and minorities will benefit.  Opponents believe the law adds more unnecessary bureaucracy for employers.  Regardless of which position you agree with, on January 4, 2015, Illinois became the first state in the nation to require employers to automatically enroll workers in a retirement account, a measure which affects an estimated 2.5 million workers in Illinois.

The Illinois Secure Choice Savings Program Act (“Secure Choice”) becomes effective June 1st, but employers will have two years to implement the program.  The law requires private employers (profit and non-profit), who have operated for two or more years, and who employ 25 or more workers (age 18 and over) to automatically enroll employees in a Roth IRA if they offer no retirement plan outside of Social Security.  Employees are automatically enrolled in the program, but may opt out at any time.  The law authorizes employers to make payroll deductions per paycheck equaling three percent of an employee’s wages, unless the worker designates a different amount.  Employers are not required to contribute to the employee’s Roth IRA.  The workers’ retirement accounts will be portable, permitting them to retain their accounts when moving from job to job.

The Secure Choice program will be managed by a private investment company chosen through a competitive bidding process.  The investment company will be responsible for presenting covered workers with investment options.  The State Treasurer, chairing a seven member board, will oversee the program and monitor the conduct of the private investment company.

Governor Pat Quinn (D) signed the law on January 4th, shortly before leaving office.  Businessman Bruce Rauner (R) defeated Quinn in the last election.

For more information, please contact Mark McAnulty at or (812) 423-3183; or contact any member of the KDDK Labor and Employment Law Practice Team.

About the Author

Mark A. McAnulty

Mark A. McAnulty, a partner at Kahn, Dees, Donovan & Kahn, LLP, in Evansville, Indiana, practices labor and employment law, and is a member of the KDDK litigation and trial services practice team. Licensed to practice in Indiana, Kentucky, Illinois, and Missouri, Mark has represented clients in administrative and judicial proceedings throughout the tri-state area. Mark counsels clients regarding hiring and disciplinary issues, as well as compliance with local, state and federal employment laws. Mark also works with clients in reviewing and drafting employment contracts, non-compete agreements, and employee handbooks; and has advised and represented employers in labor management and union avoidance matters.

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