If you run an HVACR contracting business and don’t currently offer employees a retirement plan, you may already have a compliance deadline on your calendar — whether you know it or not.
A growing number of states now require private-sector employers to automatically enroll workers in a state-facilitated retirement savings account. New York became one of the latest to hit the enforcement phase, with its first deadline arriving on March 16, 2026. But New York is far from alone. Active programs are already in place in California, Colorado, Connecticut, Delaware, Illinois, Maine, Maryland, New Jersey, Oregon, Vermont, and Virginia — and more states are moving in the same direction.
How state mandatory retirement savings programs work for employers
The structure is similar across most states. Covered employers — typically those in business for at least two years with a minimum number of employees — must automatically enroll eligible workers in a state-facilitated Roth IRA and facilitate payroll deductions at a default contribution rate, usually around 3% of gross wages. Employees can opt out or adjust their contribution at any time, and accounts are portable, so workers keep their savings if they move on.
The key exemption: if you already sponsor a qualifying retirement plan — such as a 401(k), SIMPLE IRA, or SEP IRA — you’re generally exempt from your state’s mandate. You cannot, however, drop an existing plan specifically to replace it with a state program.
HVACR contractor retirement plan compliance checklist
Whether your state has an active mandate today or is still working toward one, now is a good time to take stock:
- Confirm whether your state has an active program or pending legislation. Requirements and deadlines vary, and some states are already in enforcement mode.
- Check whether your existing benefits qualify for an exemption. If you’re unsure, your plan administrator or a qualified HR or employment law professional can help you verify.
- Review your payroll setup. These programs require automatic enrollment and deduction processing, which may mean updates to your current payroll system.
- Consider whether a private plan makes more sense. Employer-sponsored 401(k) and SIMPLE IRA plans offer more flexibility than state programs, including the option to match employee contributions — a meaningful recruiting and retention tool in a tight labor market.
ACCA continues to monitor workforce-related regulatory developments that affect contractors. Visit acca.com/advocacy for updates on the policy issues shaping your business.
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