On July 29, 2019, the U.S. Department of Labor announced the Association Retirement Plan Rule designed to strengthen retirement security for millions of small business employees throughout the country. The rule would allow small businesses to offer retirement savings plans to employees in a more cost-effective way, by allowing small businesses to band together to offer retirement plans to employees. Under the rule, association retirement plans could be offered by associations of employers who are in the same city, county, or a multi-state metropolitan area, or associations of employers who are in a particular industry nationwide. This rule would also allow sole proprietors, and entrepreneurial workers to also participate in the retirement savings plans.
According to Bureau of Labor Statistics released last year, approximately 38 million private-sector employees in the United States do not have access to a retirement savings plan through their employers. Last August, the President signed the “Strengthening Retirement Security in America” Executive Order mandating the Secretary of Labor to clarify and expand circumstances under which small and mid-size employers may sponsor or adopt an association retirement plan or a multiple employer plan for employees to offer more Americans retirement security.
The rule will be effective on September 30, 2019.
See more information on Association Retirement Plans.
This is an issue that NAR will continue to monitor.