The Deadline is Here: Is Your Business Required to Register with RetirePath?
February 15, 2024 is the deadline for eligible employers to register with RetirePath Virginia, a state-sponsored retirement savings program for private-sector employees. If your business has fewer than 25 employees or your business offers a qualified employer-sponsored retirement plan, you do not need to act unless you have received a notification from RetirePath. Qualified retirement savings programs include any plans under sections 401(a), 401(k), 403(a), 403(b), 408(k), 408(p), or 457(b) of the Internal Revenue Code (IRC).
Eligible employers are non-governmental businesses in the Commonwealth who have operated for 2 or more years, have 25 or more eligible employees, and who do not offer a qualified employer-sponsored retirement savings program. If you are an eligible employer, you must register with RetirePath. If you received a notification from RetirePath but you are not an eligible employer, you should certify an exemption online. The deadline for both registrations and certified exemptions is February 15, 2024.
What is RetirePath Virginia?
RetirePath is a new, state-sponsored retirement savings program for private-sector employees. In 2021, the Virginia General Assembly passed legislation
approving a state retirement program for private employers, aiming to increase the number of Virginians who are saving for retirement and to better align the Commonwealth with nationwide retirement savings efforts in the absence of a federal program. RetirePath is mandatory for all eligible employers who do not offer their own qualified retirement savings plan to employees.
Does Your Business Need to Register?
- have operated for 2 or more years,
- have 25 or more eligible employees*, and
- do not offer a qualified, employer-sponsored retirement savings program.
* “Eligible employees” are all employees who are 18 years or older, receiving wages, and have worked at least 30 hours per week in the preceding calendar year.
Employers who already offer qualified retirement plans are exempt from participating in RetirePath. Qualified retirement savings programs are retirement plans under sections 401(a), 401(k), 403(a), 403(b), 408(k), 408(p), or 457(b) of the Internal Revenue Code (IRC). Employers who only offer payroll deduction IRA’s, however, are not exempt.
If you are uncertain whether your business qualifies as an eligible employer, take this quiz.
What if Your Business Is Exempt?
If your private-sector business offers a qualified retirement savings plan to employees, you do not need to act. Only private-sector businesses that have operated for two or more years, have twenty-five or more eligible employees, and do not offer their own qualified retirement plan must register with RetirePath. RetirePath has notified potential eligible employers of their registration requirement by email or by letter. If you received a notification to register, but are not an eligible employer, you may certify an exemption on RetirePath’s website.
What if Your Business Does Not Want to Participate?
If an eligible employer does not offer a qualified retirement savings program of their own, the employer is required by Virginia law to participate in RetirePath. To remain compliant, a business who does not want to participate in RetirePath must establish its own qualified retirement savings program for employees and then certify an exemption.
What if an Employee Does Not Want to Participate?
While employers that facilitate RetirePath are required by state law to disclose information about eligible employees, employees are not required to participate. Employees who do not want to participate in the program must contact RetirePath themselves to opt-out.
How Do You Register with RetirePath?
RetirePath sent emails or letters to potential eligible employers with a unique Access Code and registration instructions. However, if you have not received a letter and are an eligible employer, you must register your business online and set up an account with the RetirePath Virginia Employer Portal. Instructions for setting up your employer account can be found here.
There are no employer fees for registering or participating in RetirePath. Further, employees will receive ongoing support and information directly from RetirePath, minimizing ongoing employer responsibilities. RetirePath can be incorporated into any payroll process, and the program site offers various employer resources to assist employers in introducing the program to employees.
What Are the Penalties if You Do Not Register or Certify an Exemption?
Penalties for non-compliant eligible employers can be as high as an annual fine of up to $200 per eligible employee.
Where Can I Find More Information?
RetirePath published many resources to help you understand and implement the program. At www.retirepathva.com you will find the following:
- Employer FAQ’s
- An employer registration checklist
- How-to videos
- Sample articles for introducing RetirePath to employees
- Opt-out forms for employees
- Program forms to manage your employer account
Additionally, you can contact RetirePath directly on their website contact form, or via their employer assistance phone line at 1-833-608-6281.
WHO TO CONTACT:
Please contact your relationship attorney to learn more. Alternatively, you can reach out to:
Kasey Hoare is an associate in the litigation section of the firm focusing her practice primarily on employment law. She also represents clients in commercial and business litigation in Virginia’s state and federal courts.
Nancy Simpson is an associate in the firm’s Litigation section. She represents clients in commercial, business and employment litigation in Virginia.
The authors woud like to thank Sam Cerchio for her research in completing this article. Sam is a third-year law student at the University of Richmond School of Law, and has accepted an Associate's position at Spotts Fain in September 2024.
Spotts Fain publications are provided as an educational service and are not meant to be and should not be construed as legal advice. Readers with particular needs on specific issues should retain the services of competent counsel.