According to the Government Accountability Office, up to 30% of American workers work part time. With the rise of the gig economy, there are more and more part time workers every single year, and if your business employs them, the SECURE Act that passed into law this January might make it just a little bit easier to retain them.
Passed in the interest of improving worker access to retirement accounts, the SECURE Act incentivizes small employers to offer plans by offering up to $5,000 in tax credits. To earn these credits, employers must offer plans that include mechanisms proven to increase employee use of retirement accounts — things like automatic enrolment and automatic payroll deductions. The SECURE Act also opens enrollment in 401(K) plans to part-time workers who have worked for you for at least 500-hours a year for at least three years. It is also easier for employers to band together with other small businesses to reduce the cost of offering a plan.
Changes in the way your small business administers retirement accounts might appear, on the surface, to be just one more headache to manage. The silver lining is that over the long term, access to benefits should increase your employee retention, and providing that access just got a lot more affordable to small businesses.
At AFEUSA, we understand that managing the administrative side of being an employer can be a lot to keep up with. That’s why one of our membership benefits is access to three months of free membership with payroll and HR platforms like Gusto. Gusto offers assistance with state and federal payroll filings, direct deposits, and access to affordable 401(k) plans.
by: Charles Jackson,