EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
*sb0322*
SENATE BILL 322
P6 4lr1702
SB 6/23 – B&T
By: Senator Jackson
Introduced and read first time: January 12, 2024
Assigned to: Budget and Taxation
A BILL ENTITLED
AN ACT concerning 1
Maryland Teachers and State Employees Supplemental Retirement Plans – 2
Automatic Enrollment 3
FOR the purpose of requiring the State Board of Trustees of the Maryland Teachers and 4
State Employees Supplemental Retirement Plans to implement an automatic 5
enrollment arrangement for certain State employees; requiring an eligible employer 6
to deduct wages of an employee for contribution to a supplemental retirement plan 7
in accordance with an automatic enrollment arrangement, unless the employee has 8
elected to withdraw from or cease to contribute to the supplemental retirement plan; 9
and generally relating to the automatic enrollment of State employees into 10
supplemental retirement plans. 11
BY repealing and reenacting, with amendments, 12
Article – State Personnel and Pensions 13
Section 35–101 14
Annotated Code of Maryland 15
(2015 Replacement Volume and 2023 Supplement) 16
BY adding to 17
Article – State Personnel and Pensions 18
Section 35–206 19
Annotated Code of Maryland 20
(2015 Replacement Volume and 2023 Supplement) 21
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 22
That the Laws of Maryland read as follows: 23
Article – State Personnel and Pensions 24
35–101. 25
2 SENATE BILL 322
(a) In this title the following words have the meanings indicated. 1
(B) “AUTOMATIC ENROLLMENT ARRANG EMENT” MEANS A SUPPLEMENTAL 2
PLAN PROVISION THAT REQUIRES AN ELIGIBLE EMPLOYER TO DEDUCT E LECTIVE 3
DEFERRALS FROM AN EM PLOYEE’S WAGES FOR CONTRIBU TION TO A 4
SUPPLEMENTAL RETIREM ENT PLAN UNLESS THE EMPLOYEE MAKES AN EL ECTION 5
NOT TO CONTRIBU TE OR TO CONTRIBUTE A DIFFERENT AMOUNT . 6
[(b)] (C) “Board” means the State Board of Trustees of the Maryland Teachers 7
and State Employees Supplemental Retirement Plans. 8
(D) “ELIGIBLE EMPLOYER ” MEANS THE EMPLOYER O F AN INDIVIDUAL 9
ELIGIBLE TO PARTICIP ATE IN A SUPPLEMENTAL RE TIREMENT PLAN . 10
[(c)] (E) “Supplemental retirement plans” means the deferred compensation, 11
tax sheltered annuity, salary reduction savings plans, and any other plans authorized by 12
this title. 13
35–206. 14
(A) THE BOARD SHALL IMPLEMENT AN AUTOMATIC ENROLLMENT 15
ARRANGEMENT TO AUTOM ATICALLY ENROLL ALL STATE EMPLOYEES HIRED ON OR 16
AFTER JANUARY 1, 2025, IN A SUPPLEMENTAL RE TIREMENT PLAN . 17
(B) (1) NOTWITHSTANDING ANY O THER PROVISION OF LA W, AN ELIGIBLE 18
EMPLOYER SHALL DEDUC T AN AMOUNT FROM THE WAGES OF AN EMPLOYEE FOR 19
CONTRIBUTION TO A SU PPLEMENTAL RETIREMEN T PLAN AS PART OF AN 20
AUTOMATIC ENROLLMENT ARRANGEMENT , UNLESS THE EMPLOYEE HAS ELECTED 21
TO WITHDRAW FROM THE SUPPLEMENTAL RETIREM ENT PLAN OR CEASE MA KING 22
CONTRIBUTIONS TO THE SUPPLEMENTAL RETIR EMENT PLAN. 23
(2) THE AMOUNT DEDUCTED F ROM THE WAGES OF AN EMPLOYEE 24
EACH PAY PERIOD SHAL L BE THE MINIMUM AMO UNT SET BY THE BOARD, UNLESS 25
THE EMPLOYEE ELECTS TO: 26
(I) HAVE A DIFFERENT AMO UNT DEDUCTED ; 27
(II) CEASE MAKING CONTRIB UTIONS TO THE SUPPLE MENTAL 28
RETIREMENT PLAN ; OR 29
(III) WITHDRAW FROM THE SU PPLEMENTAL RETIREMEN T PLAN. 30
(C) AN EMPLOYEE ENROLLED IN A SUPPLEMENTAL RE TIREMENT PLAN 31
UNDER AN AUTOMATIC E NROLLMENT ARRANGEMEN T SHALL BE: 32 SENATE BILL 322 3
(1) PROVIDED A NOTICE WI TH AN EXPLANATION OF : 1
(I) THE TERMS OF THE EMPLOYE E’S ENROLLMENT IN THE 2
SUPPLEMENTAL RETIREM ENT PLAN, INCLUDING THE CURREN T CONTRIBUTION 3
AMOUNT PROVIDED FOR UNDER THE AUTOMATIC ENROLLMENT ARRANGEME NT; 4
(II) THE EMPLOYEE ’S RIGHT TO INCREASE , DECREASE, OR 5
CEASE CONTRIBUTIONS TO THE SUPPLEMENTAL RETIREMEN T PLAN; 6
(III) THE EMPLOYEE ’S RIGHT TO DISCONTIN UE PARTICIPATION 7
IN THE SUPPLEMENTAL RETIREMENT PLAN WITH IN 90 DAYS AFTER THE START OF 8
EMPLOYMENT ; 9
(IV) THE EMPLOYEE ’S RIGHT TO RECEIVE A REFUND OF THEIR 10
ACCOUNT CONTRIBUTION S AS SOON AS PRACTICABLE AFTER DISCONTINUING 11
PARTICIPATION WITHIN 90 DAYS AFTER THE START OF EMPLOYMENT ; AND 12
(V) THE EMPLOYEE ’S RIGHTS REGARDING T HE INVESTMENT OF 13
THE EMPLOYEE ’S ACCOUNT AND THE IN VESTMENT OPTIONS AVA ILABLE UNDER THE 14
SUPPLEMENTAL RETIREM ENT PLAN; AND 15
(2) TREATED AS EXERCISIN G CONTROL OF THE ASS ETS IN THE 16
SUPPLEMENTAL RETIREM ENT PLAN ACCOUNT REG ARDING THE AMOUNT OF 17
CONTRIBUTIONS AND EA RNINGS. 18
(D) IF A PARTICIPANT IS E NROLLED IN A SUPPLEM ENTAL RETIREMENT 19
PLAN UNDER AN AUTOMA TIC ENROLLMENT ARRANGEMENT , THE BOARD SHALL 20
INVEST THE PARTICIPA NT’S CONTRIBUTIONS IN A DESIGNATED DEFAULT 21
INVESTMENT OPTION IN ACCORDANCE WITH EACH APPLICABLE SUPPLEMEN TAL 22
RETIREMENT PLAN . 23
(E) EACH UNIT THAT HIRES AN ELIGIBLE EMPLOYEE WHO IS NOT ALREADY 24
ENROLLED IN A SUPPLEMENTAL RETIREM ENT PLAN SHALL PROVI DE THE BOARD 25
WITH THE INFORMATION NECESSARY TO COMPLET E THE ENROLLMENT OF THE 26
EMPLOYEE UNDER THE A UTOMATIC ENROLLMENT ARRANGEMENT . 27
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall apply only to 28
individuals eligible to participate in a supplemental retirement plan who commence 29
employment or who are reinstated on or after January 1, 2025. 30
SECTION 3. AND BE IT FURTHER ENACTED, That this Act shall take effect 31
October 1, 2024. 32