Pensions for All Act

The Pensions for All Act would expand retirement coverage far beyond federal workers by requiring every employer to provide a retirement program for its employees that is equivalent to the Federal Employees Retirement System (FERS) or to enroll employees in FERS themselves. It creates a framework for a new “covered retirement program” that must offer comparable benefits and extends this approach to non-Federal employers, non-Federal employees, and self-employed individuals. The bill also makes broad amendments to the federal retirement system (5 U.S.C.) to count service and benefits of non-Federal participants the same way as federal employees, and it adds a Thrift Savings Plan component for covered non-Federal employers and self-employed individuals. In addition, the bill offers a new tax credit to help small employers and self-employed contributors fund these plans, imposes a new penalty for failing to maintain the required program, and bars employers from cutting an employee’s pay because of this mandate. Overall, it would significantly widen retirement-plan participation, alter how non-Federal retirement benefits are credited and funded, and create new enforcement and tax mechanisms to support universal coverage. Key structural elements include: (1) a mandate for employers or self-employed individuals to participate in or offer a covered retirement program equivalent to FERS; (2) statutory expansion of FERS-like rights to non-Federal employees and self-employed individuals; (3) a new 36A tax credit to encourage pension contributions by small employers and self-employed individuals; (4) a new 4980J penalty for failure to provide or contribute to the required program; and (5) protections against reducing employee compensation due to compliance with the act. The Secretary of Labor leads most programmatic definitions and administration, with coordination from the Director of the Office of Personnel Management.