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Can you exclude H-2A employees as a class?


Belgarath

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Suppose an employer has a plan with 100 otherwise eligible employees, including 10 H2A employees. Can the employer exclude the H-2A employees as a class (will easily pass coverage testing). I'm seeing conflicting information on this - some indicating that under IRCA you cannot exclude them as a class, other information indicating you can. Anyone have any experience with this issue?

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If an employer has H-2A employees, the employer likely uses a law firm at least to help on getting approvals, and advise about conditions, for those guest workers.

 

If whether it is feasible to exclude from a retirement plan the H-2A employees turns on law beyond ERISA and the Internal Revenue Code, it might make sense to put such an other-law question to the lawyers who handle the H-2A matters.

Peter Gulia PC

Fiduciary Guidance Counsel

Philadelphia, Pennsylvania

215-732-1552

Peter@FiduciaryGuidanceCounsel.com

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I worked, as counsel to another law firm, on a situation about H-2A employees.  But I never saw any advice about employment law or immigration law.  The other firm looked to me first, and the facts left no escape from Internal Revenue Code § 410(b).  (Testing was a non-starter.)

Peter Gulia PC

Fiduciary Guidance Counsel

Philadelphia, Pennsylvania

215-732-1552

Peter@FiduciaryGuidanceCounsel.com

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Certain visas require that an employer pay the employee a certain (market) rate. Since a retirement contribution is compensation, an exclusion from the plan, especially based on a visa classification, may involve a violation of the compensation rate standards for the visa. This is not my field, so I am not sure that the H-2A visa is subject to the rules. I do not know if retirement plan compensation is part of the compensation under the rules. As noted in another message, these rules are beyond the ERISA realm.

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