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Proposed legislation would provide new protections for women

Our retirement system is based on the notion that most people work full-time throughout their lives. This is a concept that has framed the rules for retirement plans. However, a lifetime of full-time work is not the common practice for many women. As Senator Patty Murray documents in the “Findings” section of her bill, the Women’s Pension Protection Act, many women work part-time and many others leave the workforce periodically to care for family members. Persons who can only work part-time often find that the only available part-time jobs are low-paying ones. With a scattershot work history many women fail to meet the requirements for pension plan participation and/or fail to accumulate sufficient retirement benefits for a secure retirement. 

First introduced in 2015, Senator Murray (D-WA) reintroduced the Women’s Pension Protection Act (S.3436) in September 2018. A companion bill, H.R. 7026, was introduced in the House by Congresswoman Jan Schakowsky (D-IL), joined by Donald Norcross (D-NJ) and Suzanne Bonamici (D-OR).  The bill is designed to fill gaps in the retirement system that leave many women out. The “Findings” section of the bill shows that women lag far behind men in retirement preparedness. Women make up two-thirds of low-wage workers, women are twice as likely to work part-time as men, and just one in five part-time workers who work a full year are eligible for a retirement plan. The cost impact on women who leave the workforce early to become caregivers equals $324,044 in lost retirement savings. 

To help women build savings for retirement the bill shortens the hours of work needed to join a 401(k) or 403(b) retirement savings plan, and to become vested in employer contributions to these plans, from 1000 hours a year to 500 hours.

The bill would also require spousal consent to distributions from 401(k)s and other individual account plans, a provision that would apply equally to men who are spouses.

New provisions added to the bill in 2018 include provisions for grants to nonprofit organizations that promote financial education for women as well as grants to community-based organizations that assist low-income women and survivors of domestic abuse needing help obtaining a share of their husbands’ retirement benefits at divorce.

This bill deserves serious attention from all members of Congress who seek to improve the retirement security of women. The Pension Rights Center supports this important legislation.

Read a summary of the Women’s Pension Protection Act of 2018

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