The Labor Department has proposed a rule that seeks to help American small businesses offer association retirement plans to their employees.
The department said Monday the proposal aims to provide minor enterprises, sole proprietors and professional employer organizations access to retirement plans such as 401(k) packages for their workers.
“Many small businesses would like to offer retirement benefits to their employees, but are discouraged by the cost and complexity of running their own plans,” said Labor Secretary Alexander Acosta.
He explained that the association retirement plans will allow employers to perform minimal effort in offering retirement benefits.
The department also plans to save costs and guide small businesses in discussions with financial institutions through the effort.
Around 38M workers in the private sector have no access to a retirement plan via their employers, the department reported.