HB5 Summary

• Amends Section 36-26-14 of the Code of Alabama 1975 to authorize automatic enrollment of employees in the State Personnel Board's tax deferred compensation plan upon employment.

• Allows employees to opt out of the plan and withdraw their contributions without penalty within 90 days after their first contribution to the plan.

• Requires automatically enrolled employees to contribute one percent of pre-tax includible compensation to the plan, with the ability to change contribution amounts as otherwise permitted.

• During the 90-day opt-out period, contributions must be invested in an investment option with limited exposure to market volatilities as determined by the plan or the employee.

• Requires written notice to employees automatically enrolled in the plan, including information about the right to opt out within 90 days and available investment options; failure to provide notice does not create additional liability for the state or plan administrators.