Nevada has enacted legislation (Senate Bill 305), which will require covered employers to enroll eligible employees in a retirement program that may include the Nevada Employee Savings Trust (NEST). Employee contributions would begin by July 1, 2025.
The details
The State of Nevada will establish a state-run retirement program, NEST, and employee contributions to their Individual Retirement Accounts (IRAs) are expected to begin by July 1, 2025.
Covered Employee and Employer
Covered employee: Is employed by a covered employer for at least 120 days, whose wages or other compensation is allocable to Nevada; and is at least 18 years of age. See the text of the law for exceptions.
Covered employer: Has more than five workers, has been in business for at least 36 months; and has not maintained a tax-favored retirement plan for its employees (or has not done so in an effective form and operation at any time within the current calendar year or three immediately preceding calendar years).
Employer Responsibilities, Protections and Requirements
Under Senate Bill 305, a covered employer must not be deemed to be a fiduciary of NEST and is required to do the following in relation to NEST:
- Automatically enroll a covered employee in NEST (or a similar program offered by a trade association or chamber of commerce);
- Withhold and contribute funds from a covered employee’s compensation to an IRA at a contribution rate set by the Nevada Employee Savings Trust Board of Trustees (the Board).
- Deposit a covered employee’s withheld contributions under NEST in a manner determined by the Board in no later than 10 business days after the date such amounts otherwise would have been paid to the covered employee.
- Allow covered employees to:
- Protect and keep confidential personally identifiable information (PII), such as the person’s name, physical and email address, telephone number and other PII and information relating to individual accounts, unless the person who provides the information or is the subject of the information expressly agrees in writing to the disclosure of the information.
See the text of the law for further details on PII protections under the law.
Employer Protections
The law protects a covered employer (or another employer) from:
- An employee’s decision to participate in or opt out of NEST.
- A participant’s or the Board’s investment decisions.
- The design of NEST or the benefits paid to participants.
- The financial performance of NEST, provided the covered employer or other employer played no role.
See the text of the law for further details on an employer’s tax and financial protections under the law.
Employer Requirements
Once prepared by the Board, covered employers may be required to deliver, distribute or facilitate the delivery of the following (and any other information to covered employees) in a time and manner set by the Board:
- Instructions on obtaining additional information about NEST.
- A description of the:
- The following statements:
Next steps
Covered employers should be on the lookout for information from the Board to help ensure compliance with Nevada’s state-run retirement program requirements under Senate Bill 305 by July 1, 2025.
Thank you,
ADP