Washington State recently enacted Senate Bill 6069, creating a state-run retirement program called Washington Saves. It is slated to go into effect on July 1, 2027.
Washington Saves allows employees to contribute part of their pay to an individual retirement account (IRA) to save for retirement. The funds can be taken out on a pre-tax basis.
Employers must enroll eligible employees automatically (those who are 18+ years old and have been employed for at least a year). Covered employers must meet all of the following criteria:
- Has a physical presence in the state of WA as of the preceding calendar year
- Has been in business for 2+ years in the state
- Doesn’t offer a retirement plan (401k, 401a, 403b, etc.) to eligible employees
- Has employees that worked for a combined minimum of 10,400 hours during the previous calendar year
The state established an automatic enrollment rate of at least 3% but not to exceed 7% of an employee’s compensation. Each year, the contribution rates will increase by 1% to a maximum of 10% of compensation.
Employees are permitted to opt out or change contribution amounts at any time.
This article is informational and does not constitute legal or financial advice. Consult with an employment lawyer or accountant for additional clarification on how these changes impact your company.
