Eligibility related

[Jakyasar]

Looking at a plan doc prepared by another. Calendar plan.

401k eligibility is 6 months (in which 1000 hours of service is required) with entry date first month following completion of 6 months. Can the plan require 1000 hours of service where eligibility is 6 months?

PS is 12 months with 1000 hours so this is fine. Entry date is dual entry, 1st and 7th months.

Thank you

[C. B. Zeller]

You can let them in after 6 months if they complete 1000 hours in 6 months, but you can't keep them out if they complete 1000 hours in more than 6 but within 12 months.

[CuseFan]

exactly

[Jakyasar]

To understand what you said:

If they worked 1000 hours in 8 months, they enter in the 9th month, correct?

[C. B. Zeller]

If that's what the plan says.

[Jakyasar]

Thank you and happy holidays

[Bri]

Often though, the "plan B" eligibility provision, the 1000 hours in 12 months, requires the full 12 months to elapse like a traditional Year of Service requirement, so it's possible the guy who hits 1000 hours in month 8 doesn't come in until after the full 12 months elapse.  So as CBZ said, definitely check what the doc says to that effect.

[loserson]

There is also the new 500-hour rule from the SECURE Act.  Long-term part-timers have to be allowed partway into the plan.

If the sole eligibility rule is "1,000 hours within 6 months or within 12 months" then you would miss those people.

[Bri]

Yeah, but that's 2024 if they're smart enough to only count the years after 1/1/2021.