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Vesting For Rehired Employee


MBCarey

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This is regarding vestint for a rehired employee. Original hire date was 2/8/1999 - term. dated 6/28/2001. At the time of termination, the plans vesting was 100% after two years which because the employee worked 1,000 in 2001, he was considered 100%. He has now been rehired as of 8/2005. On 7/1/2001 the vesting for the plan was amended amended to a 5 year cliff. Document states anyone employed on 6/30/2001 will vest according to the original vesting schedule and anyone hired after 7/1/2001 will vest according to the amended vesting.

I know this participant's hire date needs to be adjusted to give him credit for prior service since he did not incur (5) one year breaks and he has been allowed back into the plan on his rehire date not having to complete eligibility again. But what vesting schedule should apply to him? Should he remain 100% Vested?

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I agree. It sounds like he was more than 0% vested when he quit, he didn't experience 5 consecutive one-year breaks in service, so his pre-break vesting percentage, which was 100%, still applies. His vested percentage can't have been lowered.

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Guest jae3207

Does the document define "new hires" to include rehired former employees? If so, the plan may be allowed to apply the 5 year cliff to monies accrued after his/her rehire date.

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