Employers in Illinois with at least 5 employees must soon comply with the Illinois Secure Choice Savings Program Act (Secure Choice) or offer employees an employer-sponsored retirement plan.


Secure Choice requires employers to automatically withhold five percent of an employee’s compensation (up to the annual maximum allowed for IRA contributions each year as provided by the IRS), unless the employee elects a different amount or opts out of the program, and to remit those contributions to the Secure Choice program.

Under the original program, employers that satisfy these criteria are subject to the Secure Choice program:

  1. Have at least 25 employees as reported to the Illinois Department of Employment Security (IDES) for unemployment insurance payments;
  2. Have been operating in Illinois for at least two years; and
  3. Do not offer a qualified retirement plan to any Illinois employees. (A qualified retirement plan under sections 401(a), 401(k), 403(a), 403(b), 408(k), 408(p), or 457(b).)

You can find more detailed information about the originally-enacted Secure Choice program on our blog (available here).

New Requirements

The newly enacted law makes several notable changes to Secure Choice, including:

  • The 25-employee threshold is reduced to 5 employees. Now, the program will apply to employers with at least 5 employees in the state during every quarter of the previous calendar year. The employer determines the total employee count using the annual average from the employer-reported quarterly data.
  • Secure Choice now includes annual, automatic increases to the contribution rates up to a maximum of 10% of an enrollee’s wages. The Illinois Department of Revenue will establish a schedule for the automatic increase.
  • The changes clarify that the second year of non-compliance need not be consecutive for applying the $500 noncompliance penalty.
  • Employers now have 120 days (rather than 90 days) after issuance of a notice of proposed penalty assessment for noncompliance to file a protest with the department or come into full compliance.
  • The changes allow providing notices electronically rather than only by first class mail.

When Effective

The program will notify employers before their scheduled start time to allow them time to register. The schedule is:

Wave 1: The enrollment deadline for employers with fewer than 25 employees and more than 15 employees will be no sooner than September 1, 2022

Wave 2: The enrollment deadline for employers with at least 5 employees but not more than 15 employees will be no sooner than September 1, 2023.

The Illinois Secure Choice website provides additional information, including FAQs.

If you have questions or would like assistance in understanding your company’s obligations under Illinois Secure Choice, don’t hesitate to contact a team member or the Jackson Lewis attorney with whom you regularly work.