FAQs - Auto Enrollment - When must an employer provide notice of the retirement plan's automatic contribution arrangement to an employee?

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 between 30 and 90 days prior to the beginning of each plan year. For plans that automatically enroll employees immediately upon being hired, an employer may give employees the notice on their date of hire. If it is not practical to give the notice before an employee becomes eligible, 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 rules for any additional requirements.

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