MarylandSaves: A Private Employer Retirement Savings Program, Launches September 1, 2022

Jordan Dunham
Jordan Dunham

Maryland employers need to be aware that, effective September 1, 2022, certain employers must set up a mandatory retirement program for employees.

In 2016, the Maryland General Assembly passed House Bill 1378 creating the Maryland Small Business Retirement Savings Program and Trust, or “MarylandSaves” for short.  Initially planned to go into effect in 2020, but delayed due to the COVID-19 pandemic, the law creates an obligation on employers starting in September 2022. 

This fall, Maryland employers who did not previously offer a retirement account benefit to employees in the previous two years must enroll their employees in MarylandSaves, a state managed IRA account program, or otherwise elect to offer an employer sponsored program to employees.  This alert outlines the obligations on Maryland employers.  If you need specific advice on how to comply with this new law, please contact an attorney at Kollman & Saucier, P.A.

What it is:

A retirement savings program for employees located in Maryland, maintained and administered by a board appointed by Maryland’s legislative and executive branches.  As written, the law only requires Maryland employers to offer the benefit to Maryland employees.  We expect future regulations will clarify whether or not out of state employers must offer Maryland employees the same benefit and whether out of state employees working for a Maryland employer can participate.

Who it applies to:

Employers who have been in business for at least two years who are engaged in business, industry, a profession, trade, or any other enterprise in the state of Maryland that do not currently offer, or within the preceding two years have not offered, a retirement savings benefit AND use a payroll system or service to pay employees.  As written, the law would apply to out of state employers who do business in the state as well as out of state employees.  Future regulations will clarify this requirement.

Employers must automatically enroll all of their employees in the MarylandSaves program; those employees who choose not to participate in MarylandSaves must “opt out.”

What it Does:

MarylandSaves creates a state administrated retirement savings program for businesses to offer employees.  The purpose is to allow individuals who work for employers who do not have an existing retirement savings program benefit to save money for retirement through payroll deductions.  Employers who offer employees an IRA, defined benefit plan, 401(k) or similar, simplified employee pension, or some other retirement savings arrangement, are not affected by the law and the employer is not required to participate in MarylandSaves.

Effect on Employers

MarylandSaves is designed to have minimal effect on employers.  The law specifically states that MarylandSaves is not an “employer sponsored” program, and the law does not create any fiduciary obligation on employers with respect to the operation of the program or funds contributed to the program.  Additionally, an employer is not liable to employees who participate in the program regarding their decision to participate, the management/investment of assets in the program, nor the benefits employees receive from the program.

Employers do not incur any fees by participating in MarylandSaves and are not required, nor are employers able, to make contributions on behalf of employees who do participate.  However, participating employers receive a $300 waiver applied to annual filing fees assessed by the Maryland State Department of Assessments and Taxation.

Effect on Employees:

The program is an automatic enrollment plan, meaning employees who do not wish to participate must “opt out” of the program.  A participating employee may also discontinue participation at any time by notifying the board of the employee’s wish to terminate participation.

Employee is defined under the law to exclude any employees who are under the age of 18.  Once an employee reaches the age of 18, they must be automatically enrolled.

How to Prepare:

Contact your payroll processor or service to make sure they are aware of the law and its obligations.

Notify your employees as soon as possible of the MarylandSaves program, that they will be automatically enrolled, and if they do not wish to participate, they must opt out. 

Visit the MarylandSaves website at


The Maryland Small Business Retirement Savings Program and Trust is codified in Title 12 of the Labor and Employment Article.  Md. Code, Lab. & Empl. § 12-101 et seq.  



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