CalSavers staff brief Daly City Small Business Commission on state-mandated retirement program

Irma Ruiz, an outreach and client-service analyst with CalSavers, briefed the Daly City Small Business Commission on Feb. 12 about the state-run retirement program and what small employers in Daly City should expect.

Ruiz said CalSavers was created after research showed many Californians face retirement shortfalls and lack access to workplace plans. "Nearly 50 percent of Californians are projected to retire to economic hardship at or below 2 times the poverty level," Ruiz said, and she added that "7,500,000 Californians lack access to a workplace retirement plan." She explained the program’s central design: employers who report workers to the Employment Development Department (EDD) must register, while employees are automatically enrolled but may opt out.

The nut of the program, Ruiz said, is that employers act only as facilitators: there is no employer fee and employers are not fiduciaries. "As the employer, you're pretty much just the middle man, and there's no fees for employers," she said. Accounts are portable and follow workers from job to job, and default contribution settings are provided for savers; Ruiz noted the default contribution is 5 percent but participants can edit that rate.

Ruiz described the compliance timeline she said employers should expect: notices derived from EDD reporting, a 90-day window to register following a notice, and further enforcement notices from the Franchise Tax Board if a business remains out of compliance. As spoken to the commission, Ruiz quoted amounts in the notices; the transcript records those spoken figures verbatim but the sequence and units were not fully clear in the meeting audio. She said penalties that may be listed in enforcement communications are automatically waived if a business completes registration and required steps.

Ruiz emphasized CalSavers’ support services: employer-facing webinars and a field team that can provide in-person or virtual assistance, payroll integration options with third-party vendors, and dedicated helplines and resources on the CalSavers website. On investments, she said State Street manages the program’s investment options and CalSavers publishes performance information for the plan’s five investment options.

The commission asked clarifying questions about exemptions (minors under 18, government or religious employers, employers that already offer a qualifying 401(k) plan) and self-registration options for sole proprietors who do not report themselves to EDD. Ruiz said exempt employers can apply for exemptions and that individuals or contractors who are not reported by an employer can self-register.

The presentation closed with Ruiz offering staff support and webinars for Daly City businesses. The commission did not take further formal action on the CalSavers presentation at the Feb. 12 meeting.