Posted on May 17, 2023
HARTFORD — House Republican Leader Vincent Candelora on May 17 voted against legislation he says benefits the bureaucracy of the state’s fledgling retirement security program, MyCTSavings, rather than Connecticut businesses and the workers it purportedly benefits.
The legislation, (H.B. 6552) An Act Concerning the Connecticut Retirement Security Program, sets specific penalties that the Office of the Comptroller can levy against businesses that fail to enroll their eligible employees while also eliminating the deadline by which the Comptroller must pay off the debt accrued to get the controversial program off the ground.
“There’s nothing in this bill that helps workers who are being automatically enrolled into a program that takes money from their paychecks, nor are there provisions that assist small business owners now saddled with the burden of managing the red tape this program has forced into their lives,” said Candelora, who voted against the program when it was first created. “The notion that fining employers for non-compliance rather than suing them is some sort of win for the business community is an example of a policy decision that furthers our state’s reputation as a difficult environment for job creators.”
Approved by the legislature in 2016, Connecticut’s state-administered retirement security program provides savings plans for workers employed by companies that don’t offer them. It requires businesses with five or more employees to enroll workers who are least 19 years old. Those employees must also have worked for at least 120 days before they can be enrolled by the employer, though the current legislation would reduce that to 60 days—an amount of time less than most probationary periods that some companies stipulate for new workers. Enrolled employees are subjected to an automatic 3 percent payroll deduction.
Current law allows the Comptroller to file legal action against non-compliant employers, burdening them with legal costs. The legislation approved by Democrats on Wednesday instead calls for annual penalties between $500 and $1,500 depending on the number of employees, which Candelora contends companies that can’t handle the burden of paperwork and payroll processing will be forced to absorb as an annual cost of doing business in Connecticut.
When first approved, it was promised the program would not require taxpayer dollars, but the program has already spent more than $500,000 of taxpayer money and the nonpartisan Office of Fiscal Analysis estimates that the program will need nearly $2 million before it can sustain itself without taxpayer support. Yet the legislation approved Wednesday eliminates a requirement that the Comptroller’s office repay to the General Fund by Oct. 1 all the debt accrued to administer the program and provide compensation to covered workers. This legislation leaves it to the Comptroller and the Governor’s administration to determine when the money should be paid back.
“Questions about this program are often the first concerns that come up in my conversations with business owners over the last few months,” Candelora said. “We needed to do a better job of looking at this legislation through the eyes of employers and employees rather than the State of Connecticut.”
Candelora and House Republicans offered amendments (LCO 8111 & 8100) that not only preserved the program’s current 120-day eligibility provision, but also allowed workers to opt into the program rather than force them to opt out if the workers don’t want to have money automatically taken from their paychecks. Additionally, Republicans proposed a specific date—Oct. 1, 2028—for the Comptroller’s office to pay back accumulated program debt while also requiring it to issue an annual report to the Finance Committee that details amounts of money spent and repaid to the General Fund. Democrats rejected the Republican amendments.
The bill, approved in an 88 to 61 vote, now awaits action in the State Senate.
