FAQs - Auto Enrollment - When must an employer notify employees of the retirement plan's automatic contribution arrangement?

If the plan uses an eligible automatic contribution arrangement or a qualified automatic contribution arrangement, the employer must notify all employees who are eligible to participate in the arrangement 30 - 90 days before each plan year begins. For plans that automatically enroll employees immediately when they’re hired, an employer may give employees the notice on their date of hire. If it’s impractical to give the notice to an employee before they’re eligible to be in the plan, the plan can still meet the notice timing requirements by:

  • giving notice to the employee before the pay date for the pay period in which the employee becomes eligible; and
  • allowing the employee to make deferrals from any compensation he or she received after becoming eligible.

In addition to the IRS’s requirements as to the timing of the notice, the plan should consult the Department of Labor’s (PDF) rules for any additional requirements.

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