Minnesota’s Retirement Program Launches With Impending Registration Deadlines

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Quick Hits

• Employers have begun enrollment in Minnesota’s Secure Choice Retirement Program according to a phased schedule with the first deadline on June 30, 2026.
• All Minnesota employers with five or more employees that do not offer a retirement plan will be required to facilitate this state program for employees via payroll contributions. 
• Employees are automatically enrolled in the 5 percent contribution unless they affirmatively opt out.
• Minnesota employers that already have a retirement plan must file for an exemption.

On May 19, 2023, Governor Tim Walz signed a law establishing the Minnesota Secure Choice Retirement Program. Employers doing business in Minnesota with five or more employees are required to register for the program, or file for an exemption if they already offer a retirement benefit to employees. Employers can find more resources and information about the program here.

Employers must enroll by using the program portal. The deadline to enroll is staggered:

100 or more employees	June 30, 2026
50 to 99 employees	December 31, 2026
25 to 49 employees	June 30, 2027
10 to 24 employees	December 31, 2027
5 to 9 employees	June 30, 2028

Employers will need to set up an account, add payroll information, company bank information, and employee information. Thereafter, the state will communicate with the employees about their options. Employees have thirty days to opt out or customize their contributions. After thirty days, the employer begins to make the payroll deductions and submit information concerning the contributions for employees who did not opt out.

Employers will need to create a new deduction in their payroll system, create a contribution file, and enter the contribution in the portal. Thereafter, employers must remit payroll contributions for active employees each pay period, update contribution rates if the employee makes a change, and keep the employee list up to date.

Employees must be automatically enrolled, but they can discontinue, decrease or increase their contribution level at any time. The initial contribution rate is 5 percent of total wages, with an annual automatic escalation of 1 percent until the contribution rate reaches 8 percent.

Each employee’s contribution will be deposited into a Roth individual retirement account (IRA). The program does not require or permit employers to contribute matching funds to these retirement accounts.

An employer can request an exemption if it currently provides a qualified retirement plan, such as a 401(k), 403(a), 403(b), 457(b), SEP IRA, or SIMPLE IRA plan.

Employers must provide notices to employees at least fourteen days before the date of the first paycheck from which employee contributions could be deducted.

After the second year, a covered employer may face fines of up to $100 per covered employee for failure to enroll employees or distribute notices. The fines increase in amount in subsequent years. A covered employer also could face criminal penalties for willful and intentional failure to remit contributions.

Next Steps

To register before the deadline, employers need to have their employer identification number (EIN), payroll schedule, banking information, and employee information, such as names, Social Security numbers, and birth dates.

Covered employers are not considered fiduciaries and are not responsible for establishing the IRAs for employees, making decisions about plan design, processing investment change requests, or processing divestments from the IRA accounts.

A covered employee or the state attorney general may bring a civil lawsuit against a covered employer for failure to enroll covered employees, distribute notices, or remit contributions.

Ogletree Deakins’ Employee Benefits and Executive Compensation Practice Group will continue to monitor developments and will post updates on the Employee Benefits and Executive Compensation and Minnesota blogs as additional information becomes available.

Corie J. Anderson is a shareholder in Ogletree Deakins’ Minneapolis office.

Stephen A. Riga is Counsel in Ogletree Deakins’ Minneapolis and Indianapolis offices.

This article was co-authored by Leah J. Shepherd, who is a writer in Ogletree Deakins’ Washington, D.C., office.

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