Vermont Creates State-Sponsored Retirement Savings Program

Vermont has enacted legislation (S.135), which creates a state-sponsored retirement savings program. Covered employers that do not offer a retirement plan to employees must register or certify their exemption to the Vermont Saves program in a phased implementation beginning July 1, 2025 through July 1, 2026.

What you need to do

•    Vermont employers with five or more W-2 employees must register or certify their exemption. If an exemption is not registered, they must offer the Vermont Saves retirement program by July 1, 2026.

• The ADP TotalSource® 401(k) Retirement Savings Plan, also known as our Multiple Employer Plan (MEP), meets the plan offering requirement. Employers who offer the ADP TotalSource 401(k) Retirement Savings Plan to their employees should follow the instructions from Vermont to certify their exemption.

What you need to know

Vermont Saves is a state-sponsored retirement savings program that is voluntary for employees (employees also may choose to opt-out of the program).

Note: Employers are prohibited from making contributions under the plan.

Phase-In Requirements

Under S.135, beginning July 1, 2025, the State will phase-in implementation of the program, requiring employers with five or more W-2 employees to:

• Register for the program; or
• Certify their exemption from the program
  
  

The state has been reaching out to employers regarding the registration / certification process requirements.  As part of this outreach activity, employers should have received their unique Access code to register for  or certify exemption from the program (if an employer already offers a 401(k) or other qualified retirement plan).  Employers will also need their Federal Employer Identification Number (EIN) to register.

The registation deadline was March 1, 2025 and the registration requirement applies to businesses with five or more W-2 employees who have been in business for at least two years and do not offer a qualified retirement plan.

Employer Resources

See below for helpful resources, such as:

• A checklist
• An employer fact sheet
• An auto-enrollment fact sheet