Automatic Enrollment in Public Supplemental Retirement Plans

In this paper, we examine the prevalence of automatic enrollment provisions in public supplemental retirement plans. Available evidence indicates that relatively few government retirement systems have adopted automatic enrollment provisions for their supplemental retirement saving plans. We explore some factors that might explain this lack of interest in automatic enrollment by public employers, including: state laws that specifically prohibit the use of auto enrollment, the overhead costs of adding the policy, the perception that governments are already providing an adequate retirement plan, and union concerns about the impact of reduced take home pay. JEL codes: H75, J32, J45