Enacted in 2021, New York State’s Secure Choice Savings Program (the “Program” or “SCSP”) is set to take effect this year, imposing new obligations on certain private-sector employers that do not currently offer retirement benefits. The Program is part of a broader trend among states to address the retirement savings gap by providing a convenient, low-cost, and portable retirement savings option.
The Program requires covered employers to enroll employees automatically in a state-facilitated Roth IRA funded through payroll deductions. To ensure compliance, New York State businesses should be familiar with the criteria, deadlines, and associated responsibilities.
Which Employers Are Covered?
The Program applies broadly to private-sector employers (including nonprofits) that meet all of the following criteria:
- 10 or more employees in New York State during the prior calendar year.
- In business (private sector and nonprofits) for at least two years.
- The employer does not currently offer a qualified retirement plan, such as a 401(k), 403(b), or other plans specified under the Internal Revenue Code.
Employers that already sponsor a qualified retirement plan are not required to participate and are prohibited from terminating such plans solely to enroll in the Program. If you already offer a qualified retirement plan or have fewer than 10 employees, you can certify your exemption on the Program’s website.
Key Registration Deadlines
SCSP will notify employers when it is time to register; however, employers should not rely solely on these notices and should proactively confirm their obligations. The registration deadlines follow a phased approach based on company size:
- 30+ employees: March 18, 2026
- 15–29 employees: May 15, 2026
- 10–14 employees: July 15, 2026
How the Program Works
Once registered, employers must facilitate employee participation in the Program. Key features include:
- Automatic enrollment: Employees aged 18 or older with New York State wages are automatically enrolled.
- Default contribution rate: 3% of wages, deposited into an individual Roth IRA.
- Employee choice: Employees may opt out within 30 days or adjust contribution levels at any time.
- Portability: The Program is designed to be portable, meaning employees can retain their accounts even if they change jobs.
- Payroll-based contributions: All contributions are made through employer-facilitated payroll deductions, making it easy for employees to save consistently. Employers are responsible for facilitating these deductions, but are not required to contribute to the accounts.
Employer Responsibilities (and Limitations)
Employer obligations under SCSP are intentionally limited and administrative in nature. Employers must register for the Program and provide required employee data, manage payroll deductions and remit contributions, and maintain accurate and up-to-date employee and contribution records.
Employers are not permitted to contribute to employee accounts and are not considered fiduciaries with respect to the IRAs. As a result, employers are not responsible for investment decisions, program administration, or account performance. Employers are also required to provide employees with information about the program, including their right to opt out.
If an employer receives a registration notice but already offers a qualifying retirement plan, it can certify an exemption through the SCSP portal using its federal EIN and a unique access code provided by New York State.
Practical Considerations and Next Steps
Employers should take steps now to evaluate their compliance strategy and operational readiness. In particular:
- Assess coverage: Confirm whether your workforce size and benefits offerings trigger participation.
- Evaluate alternatives: Consider whether adopting a private retirement plan better aligns with your business objectives.
- Coordinate internally: Engage payroll providers and HR teams early to prepare for enrollment and ongoing administration.
- Monitor communications: Watch for notices from the Program Administrator and ensure timely registration.
Registration and enrollment periods have begun, so employers should take steps now to understand their obligations under the program and ensure compliance with deadlines.
If you have any questions about this program or any Labor or Employment law issues, please contact our Labor & Employment team:
- Paul F. Keneally, 585-258-2882, pkeneally@underbergkessler.com
- Jennifer A. Shoemaker, 585-258-2825, jshoemaker@underbergkessler.com
- Ryan T. Biesenbach, 585-258-2865, rbiesenbach@underbergkessler.com
