New York State* will begin requiring certain private-sector employers to facilitate retirement savings for their employees through the New York State Secure Choice Savings Program beginning March 18th, 2026, unless they already offer a qualified retirement plan. The key requirements and legal details are as follows:

Employer Coverage and Applicability

The mandate applies to employers that:

• Are engaged in business in New York State (for-profit or not-for-profit),
• Have employed at least 10 employees in New York State at all times during the previous calendar year,
• Have been in business for at least two years, and
• Have not offered a qualified retirement plan (such as a plan under IRC sections 401(a), 401(k), 403(a), 403(b), 408(k), 408(p), or 457(b)) in the preceding two years.

Program Structure

• The program is an automatic-enrollment, payroll-deduction Roth IRA arrangement.
• Employees are automatically enrolled unless they opt out.
• The default employee contribution rate is 3% of wages, but employees can select a different rate or opt out entirely.
• Contributions are subject to the annual IRA contribution limits under IRC section 219(b)(1)(A). 

Employer Responsibilities

• Employers must facilitate payroll deduction for employees who do not opt out and remit contributions to the program.
• Employers must provide required informational materials to employees at least one month before facilitating access to the program for existing employees, and at the time of hiring for new employees.
• Employers are not required to make contributions themselves—only to facilitate employee contributions.
• Employers are not considered fiduciaries of the program, are not responsible for investment decisions, and are not liable for investment returns or program design.

Employee Rights

• Employees can opt out at any time or change their contribution level.
• Employees can select from available investment options or be placed in a default option if they do not make a selection.
• Employees can terminate participation at any time. 

Exemptions and Additional Provisions

• Employers who already offer a qualified retirement plan are exempt and may not terminate such a plan solely to participate in the Secure Choice program.
• The state and participating employers have no liability for investment performance or payment of benefits beyond the funds in the program.
• The program is overseen by the New York Secure Choice Savings Program Board, which is responsible for administration, investment options, and compliance with federal law. 

Implementation Timeline

Registration deadlines depend on employer size:

• 30+ employees: March 18, 2026
• 15-29 employees: May 15, 2026 
• 10-14 employees: July 15, 2026

Employers might receive notice from the state when they must register.

Potential penalties for non-compliance

Failure to comply can result in fines being assessed on a per-employee basis.

• Initial penalties may start at about $250 per employee.
• Repeated or ongoing violations can increase to over $1,000 per employee. 

These fines can accumulate quickly if the employer has many eligible employees.

New York has indicated that early enforcement may emphasize education and outreach, giving employers time to comply before aggressive penalties are imposed.

Q&A

1. As an employer, must I participate in the New York Secure Choice Savings Program?

• A: An employer who does not have their own plan must participate in the State’s program.

2: If we have our own plan, how do we notify the State Board? 

• A: The employer will file an exemption form with the State Board.

3: Do Yeshiva’s employing Clergy employees (Parsonage) need to be registered with the program. 

• A: Yes

4: We operate in multiple states, do we have to participate in the program? 

• A: Participation is based on employees working in NYS, not where the employer is headquartered. If there employer has more then 10 employees in NYS, they should be enrolled. 

5: Do we have to include part-time employees?

• A: The Secure Choice Savings Program defines "employee" broadly to include any individual employed by an employer in New York State, regardless of full-time or part-time status, as long as they are 18 years of age or older and receive wages subject to New York State income tax.  There is no indication in the program’s statutory language or guidance that part-time employees are excluded based on the number of hours worked. Therefore, part-time employees are generally eligible if they meet the age and wage criteria.

*As of 2026, the states with active or soon-to-be-implemented mandatory workplace retirement savings programs similar to New York’s Secure Choice include California, Colorado, Connecticut, Delaware, Illinois, Maine, Maryland, New Jersey, Oregon, Rhode Island, Vermont, Virginia, Minnesota, Nevada, Hawaii, and New Mexico.

If your organization is evaluating retirement plan options or preparing for upcoming compliance requirements, understanding both the program rules and the available tax incentives is important.

In a related article, we also discuss retirement plan audit requirements and available federal tax credits for employers who establish their own retirement plans.

If you have questions about how these rules apply to your organization, our team is here to help.