Perspectives

Minnesota Secure Choice is Here: What Employers Need to Do (and When)

If your business doesn’t currently offer a retirement savings plan, there’s another employment compliance requirement to add to your radar.

The Minnesota Secure Choice Retirement Program (“Secure Choice”) is now open for employer registration. Begining in 2026, many Minnesota employers need to either register for the program or certify that they’re exempt.

The good news? While employers have responsibilities under the program, they are not responsible for funding employee retirement accounts or managing investments. 

Here’s what employers should know.

What is Minnesota Secure Choice?

Secure Choice is a state-established automatic payroll deduction IRA program designed for employees who don’t have access to a workplace retirement plan. The program allows eligible employees to save for retirement through payroll deductions.

Employers are not required to make matching contributions, and there are no employer fees associated with the program. Employers may still experience some administrative costs related to payroll setup and ongoing administration.

Which Employers Are Covered?

Your business must participate if you:

• Have five or more employees, and
• Do not currently offer (or have not offered within the previous 12 months) a qualified retirement savings plan.

If you already offer a qualified retirement plan, you are generally exempt-but you must certify that exemption through the Minnesota Secure Choice portal.

Certain employees are excluded from the program, including:

• Government employees
• Employees who were under age 18 on December 31 of the previous calendar year
• Certain temporary or seasonal employees hired for 180 days or less

Registration Deadlines

Registration occurs in phases based on employer size. Employers should receive notice from Minnesota Secure Choice when it’s time to register.

Current deadlines include:

• Voluntary enrollment (any size covered employer) Deadline: March 30, 2026
• 100+ covered employees Deadline: June 30, 2026
• 50-99 covered employees Deadline: December 31, 2026
• 25-49 covered employees Deadline: June 30, 2027
• 10-24 covered employees Deadline: December 31, 2027
• 5-9 covered employees Deadline: June 30, 2028
• 4 or fewer employees Exempt

If your business has 100 or more covered employees, now is the time to confirm you’ve either registered or certified your exemption. Even if your deadline is later, it’s worth coordinating with your payroll provider now to avoid a last-minute scramble.

How Employee Contributions Work

Secure Choice is funded entirely through employee paryroll deductions.

Employer contributions are not permitted.

Unless an employee chooses a different option or opts out, payroll deductions:

• Begin at 5% of pay
• Increase automatically by 1% each year
• Cap at 8%

Employees may:

• Opt out
• Choose a different contribution percentage
• Stop contributions later, following the program procedures

Contributions generally go into a Roth IRA unless the employee elects a traditional IRA.

Employees are always fully vested in their accounts.

Employer Responsibilities

Although employers aren’t managing retirement investments, they are responsible for administering the program.

This includes:

• Registering or certifying an exemption
• Enrolling eligible employees
• Processing payroll deductions
• Maintaining employee and payroll information
• Keeping records up to date

What Happens if an Employer Doesn’t Comply?

Minnesota law includes penalties for employers who fail to meet their obligations.

After the applicable warning period, employers that fail to enroll covered employees or begin required payroll deductions may face penalties beginning at $100 per covered employee, with higher penalties possible in later years.

Employers should pay particular attention to withheld employee contributions.

If payroll deductions are taken from employee paychecks but are not remitted on time, employers may be required to:

• Submit the withheld contributions
• Pay applicable interest

A willful and intentional failure to remit withheld contributions after demand may also result in misdemeanor penalties.

Getting Ready

When your registration window opens, you’ll need to:

• Register using your company’s EIN and Secure Choice Access Code
• Connect your payroll provider or upload payroll schedules
• Add banking information
• Upload eligible employee information

After registration:

• Minnesota Secure Choice communicates directly with employees during their 30-day election period.
• Employers then begin payroll deductions for participating employees.
• Employers continue submitting payroll contributions and maintaining employee records.

Don’t Wait Until Your Deadline

Like many new employment laws, Minnesota Secure Choice is designed to become part of your normal HR and payroll processes. Businesses that prepare early generally experience a smoother rollout.

Whether you’re determining if you’re covered, coordinating with your payroll provider, or simply making sure your compliance processes are current, it’s easier to address these questions before your registration deadline arrives.

WFJ’s Employment Law team and Compliance Center help employers stay ahead of changing workplace requirements so compliance becomes part of doing business-not a last-minute emergency.