Some states require employers to provide retirement plans in which employees are automatically enrolled and from which employees must actively choose to opt out. The aim of these plans is to encourage employees to save more for retirement. Using the Pre-defined, allow Employee Changes on Enrollment field, you can auto-enroll employees in a plan option at a designated contribution percentage, while still giving employees the ability to change their contribution amount or to opt out entirely.
To initially set up a predefined retirement plan option and to configure an ongoing enrollment that allows employees to be enrolled in the plan or to opt out of it:
- In Benefits Setup > Plans and Options, add the following two options:
- A retirement plan with an auto-enrolled option using the Pre-defined, allow Employee Changes on Enrollment field.
- A retirement plan with a waive or “opt out” option. To create a waive option, you must create a waived plan (for example, “Waive Retirement”) and set up a waive option under this plan. Don’t attach this plan to a carrier and don’t create waive options for other plans that are attached to carriers.
- Note: Creating waive options under the carrier plans result in the failure of the Dayforce Link export files, requiring reconfiguration of the waive options.
- Run the Benefits Auto Enrollment Option Process background job for the predefined option to assign it to all eligible employees.
- In Benefits Setup > Plan Option Group, configure a group that includes both of these options.
- In Benefits Setup > Enrollments, set up, but don’t publish, a Periodic Enrollment with just one election set that includes both options you have added.
- Set the minimum and maximum elections for this set at 1.
- Publish the Periodic Enrollment.
- Note: It’s ideal that you set the Coverage Effective Date value such that employees have time to opt out of or change their election before any checks are processed with the auto-enrolled deduction.
Employees don’t need to access the enrollment if they want to maintain the auto-enrolled contribution level. If they want to make any changes, then they should access the enrollment and either change the amount, or opt out (select the waive option), and submit the enrollment.
It’s recommended that you auto-enroll eligible new hires in the option and ensure that they receive a New Hire or Periodic Enrollment so that they can update or waive the option.