Council Members I. Daneek Miller and Ben Kallos received the support of several labor groups this week at City Hall for their universal retirement savings program, which would support private-sector employees who don’t have an IRA plan through their employer.
Intro. 0888 would establish an individual retirement account for these workers at private firms that have 10 or more employees within the city if the business does not offer a savings plan, and they will be enrolled automatically with the option to opt out if they so choose, according to the bill.
Contributions will be handled through payroll deductions set at a default rate and employees have the opportunity to change the quotient they want to give to the plan, according to the bill. The program would only have savings from the employees, there would be no city or employer contributions included in the plan.
Employers would be required to distribute the program information to their employees or risk a fine, according to the bill.
A supplementary bill, Intro. 0901, would establish a board to facilitate the implementation of an IRA program, minimize fees and costs associated with administering it and conducting outreach and education lessons for employees and employers.
“Our legislation will help more than half of the working New Yorkers who are currently without a savings plan set aside a portion of their earnings so they can lay a foundation for a stable future, and particularly benefit communities of color who saw their average household wealth plummet for over three decades,” said Miller, chair of the Committee on Civil Service and Labor.
There are 3.5 million private-sector workers throughout the city and an estimated 1.5 million do not have a retirement plan through their employer, according to Intro. 0888.
“Every New Yorker should be able to save for retirement,” said Kallos. “It’s hard to imagine that Republicans are all of a sudden against Americans taking ‘personal responsibility’ but stopping retirement savings for all was at the top of the Trump administration’s list in 2017 and even passed the Republican Congress.”
Michael Mulgrew, the president of the United Federation of Teachers, believes the bill must get all the support that it needs.
“Private sector employees need retirement security,” said Mulgrew. “This is an opportunity for the public and private sectors to work together to improve the future for our neighbors and fellow New Yorkers.”
Bob Master, the assistant to the vice president of Communication Workers of America, District 1, shares Mulgrew’s sentiments.
“Too many working New Yorkers face the prospect of getting older with no retirement savings – rather than retiring with the respect and dignity that they deserve,” said Master.” This “new kind of private sector ‘minimum pension,’ analogous to the minimum wage, …will set a floor for retirement security and ensure that more workers can enjoy a decent, dignified retirement. And critically, this program is an important step towards re-establishing the idea that every working person deserves a decent pension.”
