New York has officially joined the growing list of states requiring certain private employers to offer retirement savings options. The New York Secure Choice Savings Program (Secure Choice or the Program) is moving closer to implementation, and employers, particularly those without an existing retirement plan, should be preparing now.
What Is Secure Choice?
Secure Choice is a state-sponsored retirement savings program structured as an automatic-enrollment Roth IRA. Employees are automatically enrolled but may opt out at any time. Contributions are funded through payroll deduction, and unlike a 401(k), employers do not contribute, manage investments, or assume fiduciary responsibility. Their role is limited to facilitating access.
Who Must Participate?
An employer will be covered under Secure Choice if it:
- Has 10 or more employees in New York at all times during the prior calendar year,
- Has been in business for at least two years, and
- Does not currently sponsor a qualified retirement plan (such as a 401(k), 403(b), SIMPLE IRA, or SEP).
Employers notified by the Program, who believe they are exempt, will need to follow specific procedures to certify their exemption.
What About New York City’s Retirement Security for All Act?
New York City’s Retirement Security for All Act (the RSA), effective in 2021, would have required certain NYC employers with five or more employees to provide an IRA program similar to Secure Choice. However, the RSA contained a clause preventing implementation if a conflicting state or federal law was enacted. Once Secure Choice became law, implementation of the RSA stopped.
Recent Developments: State Guidance Expands
New York State recently began posting updated information about the Program on its official website, including Program details and timelines. We expect additional updates as the state finalizes enrollment procedures and guidance materials. Employers will want to stay alert for these updates.
Compliance Timeline
- Pilot phase: Underway now.
- Program enrollment: Expected to open in late 2025.
- Compliance window: Once the Program is live, covered employers will have up to nine months to register, upload employee data, and begin payroll deductions.
Steps Employers Should Take Now
Even before registration opens, employers can position themselves for a smooth rollout:
- Determine Applicability – Review workforce size and retirement offerings. If you meet the thresholds and lack a qualified plan, expect to participate.
- Prepare for Exemption (If Eligible) – If you already sponsor a qualified retirement plan, gather supporting documents to certify your exemption quickly.
- Audit Payroll Systems – Confirm your payroll provider can withhold post-tax contributions, remit them on time, and track opt-outs.
- Organize Employee Data – Employers will need to provide basic employee information (name, SSN, date of birth, contact details). Preparing this data now will streamline onboarding. As always, employers should take steps to protect participant data as well.
- Communicate with Employees – The state will provide template materials, but employers should expect questions. Early messaging can help employees understand this is a state-run program, not an employer-funded plan.
- Evaluate Alternatives – Secure Choice is intended as a baseline option. Employers may wish to compare it against private retirement solutions, such as a 401(k) or pooled employer plan, which can offer higher contribution limits, employer matches, and broader investment menus, although additional compliance burdens may apply.
The Bottom Line – For many New York employers, Secure Choice will soon shift from a policy conversation to a compliance requirement. By staying informed on the state’s latest updates, reviewing eligibility, and aligning payroll processes now, employers can avoid last-minute hurdles and decide whether a private plan might better suit their workforce.
