Automatic Enrollment Implementation
Is automatic enrollment permissible under law?
Yes
Explanation:
Public employers may adopt automatic enrollment for their deferred compensation plan.
Relevant State Laws – P.L. 1977, c.381 (C.43:15B-1)
“An employer may adopt, in connection with a deferred compensation plan, a written provision that permits the employer to defer and deduct from an employee’s salary a specified percentage unless the employee makes an affirmative election not to defer or to defer a different percentage. An automatic enrollment arrangement shall establish a default deferral percentage, may provide for periodic escalation of deferral percentages, and may provide default reenrollment of employees who are not participating in the plan or are participating at less than the default percentage.”