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PSCA Executive Reports

October 29, 2019


California is one of several states currently implementing legislation that requires employers without a retirement plan to automatically enroll their employees in a payroll deduction IRA. The Howard Jarvis Taxpayers Association brought a lawsuit alleging that CalSavers is preempted by ERISA. The judge issued a decision in favor of the State but gave the plaintiffs time to amend their complaint (despite stating that it would be “futile”). DOJ and DOL recently submitted a statement of interest supporting the plaintiff’s position. The statement is unusual for two reasons. First, DOL rarely intervenes in litigation at the trial court level. They typically do not weigh in until cases reach the appeals court. Second, DOJ and DOL waited until after the court already issued a decision to submit a statement. Typically, such statements would be submitted prior to a decision, not after. The court has not decided on the question of whether it will accept the DOJ and DOL statement.


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