Massachusetts House Bill H1226

Massachusetts 2025-2026 Regular Session

• Introduced: 2/27/25
• Refer: 2/27/25

Caption

Relative to secure choice retirement savings plan

Impact

The bill mandates that employees who meet the criteria, defined primarily by their hours worked, will be automatically placed into the retirement savings program, which can greatly expand participation rates in retirement savings plans. It also delineates the responsibilities of the new Secure Choice Retirement Savings Board, which will oversee the administration, management, and compliance of the programs. This initiative is seen as a means to combat the declining rate of retirement savings among workers in the Commonwealth, particularly those without access to traditional employer-sponsored retirement plans.

Summary

House Bill 1226, titled 'An Act relative to secure choice retirement savings plans', aims to establish a secure choice retirement savings mechanism for employees in the Commonwealth of Massachusetts. Central to this bill is the creation of the Individual Retirement Account Program (IRAP) and the Multiple-Employer Retirement Account Program (MERP). Eligible employers are required to automatically enroll their eligible employees into the IRAP unless they offer an alternative qualified retirement plan. This auto-enrollment system is intended to facilitate employee participation in retirement savings and enhance financial security for workers.

Contention

Discussions have noted potential contention surrounding the bill, particularly among small businesses. Opponents argue that requiring automatic enrollment for employees could impose additional regulatory burdens, particularly for smaller employers who may struggle with compliance costs or may prefer to provide alternative retirement saving arrangements. Additionally, concerns have been raised regarding the liability of employers in terms of contributions and plan management, even as the bill specifies that employers do not have fiduciary responsibilities except with respect to timely contributions. Legislators will need to weigh these businesses' concerns against the benefits of increased retirement savings for Massachusetts workers.