DOL Proposes Safe Harbor and Issues Interpretive Bulletin on State-Based Savings Programs | Practical Law
On November 16, 2015, the Department of Labor (DOL) proposed a regulation establishing a safe harbor for certain state-based savings programs (SSPs) established pursuant to state payroll deduction programs so that these SSPs are not considered pension plans under the Employee Retirement Income Security Act of 1974 (ERISA). To date, California, Illinois and Oregon have adopted SSPs. The intent of the safe harbor is to reduce the risk of the state laws establishing SSPs being preempted by ERISA if and when they are challenged in court.