Part-time employees won’t be included in Virginia’s new auto-IRA program after a contingent of Senate Democrats rejected Gov. Ralph Northam’s proposal to broaden an initiative meant to encourage more lower-income workers to save for retirement.
The program, set to take effect no sooner than 2023, will require businesses that don’t offer retirement benefits to give full-time workers the option of enrolling in a state-run plan allowing them to put some of their paycheck toward retirement.
Several Senate Democrats said they didn’t want to burden small businesses with administering the enrollment of employees working fewer than 30 hours a week or people hired for seasonal positions.
“Sometimes I wonder if anyone up on the third floor ever actually managed a business or owned a business,” said Sen. Chap Petersen, D-Fairfax, referring to the floor in the Capitol building where the governor’s offices are.
Advocacy groups who supported a broader program said the decision will exclude more than 150,000 Virginia who would have otherwise been automatically enrolled in the savings program, offered to workers who don’t have access to employer-sponsored retirement benefits.
The Virginia Mercury is a new, nonpartisan, nonprofit news organization covering Virginia government and policy.