Automatic Enrollment Implementation
Is automatic enrollment permissible under law?
Yes
Explanation:
Colorado explicitly permits automatic enrollment for all public sector retirement programs. However, automatic enrollment has not been implemented in the state plan.
Relevant State Laws – C.R.S. 8-4-105.5
“No employer shall make a deduction from the wages or compensation of an employee except as follows:
(a5) Deductions for contributions attributable to automatic enrollment in an employee retirement plan, as defined in section 8-4-105.5, regardless of whether the plan is subject to the federal “Employee Retirement Income Security Act of 1974”, as amended”
For purposes of this provision, “employee retirement plan” means “a plan described in sections 401(k) or 403(b) of the [Internal Revenue Code]; a governmental deferred compensation plan described in section 457 of the [IRC]; or a payroll deduction individual retirement account plan described in sections 408 or 408A of the [IRC].”