(1) The board shall adopt rules that:
Establish the process for enrollment in the program developed pursuant to section 2454.3-104, including procedures for automatic enrollment of employees and for employees to opt out of the program;
Establish the process for withdrawal from program accounts, including allowing anemployee to withdraw money without penalty from the program for at least the first two years of enrollment within the program;
Establish the process for participants to make the default contribution of five percentto program accounts and to adjust the contribution levels, including mechanisms for automatic adjustments of contribution levels;
Establish the process for employers to withhold employee contributions to programaccounts from employees' wages and send the contributions to the program administrator for the program within no more than fourteen days of contribution being withheld from an employee's wages;
Establish the process for participants to make nonpayroll contributions to programaccounts;
Set minimum and maximum contribution levels in accordance with limits establishedby the internal revenue code;
(I) Establish the process and requirements for employer exemption from offering theprogram if the employer offers a qualified retirement plan, including but not limited to a plan qualified under section 401 (a), section 401 (k), section 403 (a), section 403 (b), section 408 (k), section 408 (p), or section 457 (b) of the internal revenue code;
The process for exemption shall be minimal for employers and the board shall useexisting state forms and state compliance structures for exemption reporting;
The process for exemption shall allow employers to become exempt if the employerenters into legally compliant multiple employer plans;
Establish the process and requirements for providing grants to incentivize compliance with the program and defray costs incurred by small businesses with five to twentyfive employees; except that a grant for a single employer shall not exceed three-hundred dollars;
(I) Establish minimal fines for employer noncompliance in an amount up to one hundred dollars for each employee per year who is eligible to participate in the program, not to exceed an aggregate amount of five thousand dollars in a calendar year;
Enforcement of fines shall not commence until at least one year after the program isestablished or one year after an employer is scheduled to enter the program, whichever is later;
An employer shall not be fined until three months after the employer has received anotice of noncompliance;
Establish the process for enforcing employer compliance with the program, in partnership with the department of labor and employment; and
Mandate the contents and frequency of required disclosures to employees, employers, and other program participants. These disclosures must include, but need not be limited to:
The benefits and risks associated with making contributions to the program;
Instructions for making contributions to the program;
Instructions for opting out of the program;
Instructions for participating in the program with a level of contributions other thanthe default rate;
The process for withdrawing retirement savings in accordance with the employee'sinvestment type;
How to obtain additional information about the program;
That employees seeking financial advice should work with the program administrator or contact financial advisers, that participating employers are not in a position to provide financial advice, and that participating employers are not liable for decisions employees make in connection with their participation in the program;
That the program is not an employer-sponsored retirement plan;
That the program accounts and rate of return are not guaranteed by the state; and
The possible tax implications and restrictions of individual retirement accounts.
Source: L. 2020: Entire section added, (SB 20-200), ch. 295, p. 1464, § 7, effective July 14.
Cross references: For the legislative declaration in SB 20-200, see section 1 of chapter 295, Session Laws of Colorado 2020.