CalSavers: The Latest Retirement Plan Mandate for California Businesses

For California business owners, retirement plans have become a hot-button issue in recent years. And now, with the arrival of CalSavers, the latest retirement plan mandate, things have become more complicated.

Beginning December 31, 2025, all employers with one or more employees must participate in CalSavers if they do not already have a workplace retirement plan.

While this change is certainly geared towards benefiting employees, many California business owners are left feeling overwhelmed and unsure of how to become compliant with CalSavers.

In this blog post, we’ll provide some actionable steps on how to participate in CalSavers and become compliant with this new mandate.

Step 1: Register Your Business With CalSavers

The first step in becoming compliant with CalSavers is to register your business on their website. Simply go to the CalSavers homepage, click on “register now,” and follow the prompts. You’ll need to provide some basic information about your business, such as your business name, address, and industry type. Once you’ve registered, you’ll be able to set up your CalSavers account and begin enrolling your employees.

Step 2: Determine Employee Eligibility

Not all employees are eligible for CalSavers. Specifically, seasonal and temporary employees that work less than 1000 hours per calendar year are not eligible. Similarly, if an employee is already enrolled in a qualified retirement plan through your business, they are also ineligible for CalSavers. Once you’ve determined which employees are eligible, it’s time to begin enrollment.

Step 3: Enroll Your Employees in CalSavers

Once you’ve registered your business and determined employee eligibility, it’s time to begin enrolling your employees in CalSavers. Your employees will receive an invitation to participate in CalSavers, and it’s up to them to decide whether or not they’d like to enroll. If they do choose to participate, they’ll be automatically enrolled at a default contribution rate of 5% of their wages. If your employees choose not to participate, they’ll need to opt out of the program.

Step 4: Stay Compliant with CalSavers

As with any new mandate, it’s important to stay up-to-date with the latest information on how to stay compliant. CalSavers is still a new program, and updates and changes may occur. Make sure to regularly visit their website for any new information. Additionally, ensure that employee data is regularly updated and accurate, and that your business is making timely contributions to CalSavers.

Step 5: Consider Offering Your Own Workplace Retirement Plan

While CalSavers is a viable option for businesses that don’t currently offer a retirement plan, it’s not the only option. Consider offering your own workplace retirement plan, such as a Simplified Employee Pension Plan (SEP-IRA) or a 401(k) plan. By offering your own plan, you can potentially save on administrative fees and give your employees more investment options.

Overall, CalSavers is a positive step towards increasing retirement savings for California employees. And while it may seem overwhelming for business owners to become compliant, it’s an important step towards providing your employees with a benefit that can help them secure their financial future. By following these actionable steps, you can easily become compliant with CalSavers and stay up-to-date with any changes that may occur. Additionally, consider offering your own workplace retirement plan to give your employees even more investment options. With a little effort and attention, you can ensure that your business is in compliance with CalSavers while providing your employees with the valuable benefit of a retirement plan.