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California’s Auto-Retirement Program Denied Supreme Court Review

Feb. 28, 2022, 2:36 PM

The U.S. Supreme Court declined to hear a case asking whether California’s automatic retirement program for workers without employer-sponsored plans can coexist alongside the federal Employee Retirement Income Security Act, the justices announced Monday.

The lawsuit by Howard Jarvis Taxpayers Association, a California policy group that supports lower taxes, asked the court to strike down the CalSavers Retirement Savings Program as preempted by the federal ERISA statute. CalSavers is an invalid attempt by the state to insert itself into the federally preempted field of workplace retirement plans and impose mandates and rules that conflict with ERISA, Howard Jarvis claims.

At least 14 states that have enacted state-facilitated retirement programs, and at least 45 have proposed similar programs or taken steps toward studying the issue, according to the Center for Retirement Initiatives at Georgetown University in Washington.

CalSavers creates automatic retirement savings vehicles for California workers without employer-sponsored plans. In May, the U.S. Court of Appeals for the Ninth Circuit upheld the program, reasoning that CalSavers isn’t preempted by ERISA because it’s run by the state without forcing employers to create their own benefit plans.

Howard Jarvis represents itself. The Office of the California Attorney General defended the program in the Ninth Circuit.

The case is Howard Jarvis Taxpayers Ass’n v. Cal. Secure Choice Ret. Savings Program, U.S., No. 21-558, certiorari denied 2/28/22.

To contact the reporter on this story: Jacklyn Wille in Washington at jwille@bloomberglaw.com

To contact the editors responsible for this story: Rob Tricchinelli at rtricchinelli@bloomberglaw.com; Nicholas Datlowe at ndatlowe@bloomberglaw.com