Dear Employers,

We wanted to inform business owners who have not yet acquired a retirement plan for your employees.  California has set a final date of June 30, 2022 for employers with greater than five employees to enroll in a retirement program. If you have not enrolled in a program, they have provided the CalSavers program as a simple option. Please read through the information below or call our office if you have additional questions.

The CalSavers program is a retirement plan administered by the state of California.  CalSavers accounts are Roth IRA accounts and are subject to the same contribution and participant income limits applicable to all other Roth IRA accounts. These accounts are funded through the employee’s payroll contributions and employers are prohibited from making contributions to these accounts.

Employers with 5 or more employees (at least one of whom is age 18) who do not provide their own retirement plan are required to enroll both their business and their employees in the CalSavers program. The employee thresholds are based on the average number of employees for the prior calendar year.  All employees are counted, including short-term and part-time employees.  For 2022 this would be the average number of employees based on the quarterly DE9C reports filed for 2021.

Religious organizations with a 501(c)(3) exemption are not required to register; however, most nonprofit organizations are treated like other businesses and must register for the program.

The program has been phased in and employers must register as follows:

  • Employers with more than 100 employees were required to register by September 30, 2020;
  • Employers with more than 50 employees were required to register by June 30, 2021; and
  • Employers with more than 5 employees must register by June 30, 2022.

To register in the CalSavers program or certify an exemption for your business, go to  Once registered, an employer must provide an employee roster to CalSavers on their website and then CalSavers will contact the employees directly to determine their contribution percentage.  When the employees are contacted, they will be asked what their contribution rate will be or if they wish to opt out of contributing.  If the employee does not respond, they will automatically be enrolled with a default 5% contribution rate for the first year which will increase by 1% each year, up to 8%.

Eligible employers who fail to comply with the program will be subject to penalties of $250 per employee after receiving a 90-day notice of noncompliance.  An additional penalty of $500 per employee will be assessed if they do not comply within 180 days of the notice.


Atherton & Associates, LLP