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Not trying to be rude here but I would like to ask one more question because I am shocked someone would try this. When you say ESOP you mean it is an Employee Stock OWNERSHIP Plan and NOT some kind of stock OPTION plan correct?

Unbelievable.

Then as others say that would violate the law. The reason I asked was because what they are doing is such a well known wrong I am having a hard time believing that any lawyer would ever agree to the idea. Maybe make sure you understand it correctly once sure of that you will need to decide on the next course of action. However, the rules are clear that they have to pay a vested benefit.

Forfeiture of otherwise vested benefits for this reason would likely violate the vesting requirements of ERISA.

No, the Company cannot avoid paying you your benefit because you now work for a competitor.

Is a recordkeeper's QDRO-review service worthwhile? Yes. I find that the plan administrator often times needs someone to review the QDRO. Maybe it is because I work in the TPA world I find our reviews are better then the attorney's. While the attorney is often times very sharp on the law they tend to have never had to deal with the practical aspects of QDROs. Just read a random selection of QDRO questions on this board. What at first glance seems like a reasonable description that is very specific on who to split the accounts often times isn't very clear when the TPA looks at it. Simple example that happens all the time with ESOPs. Since most attorneys are used to 401(k) plans that are valued daily we get ESOP QDROs that will say split the account as of 9/8/2015. The reality is the valuation only happens once a year for most ESOPs and if it is a calendar year plan that mean the last annual work was done 12/31/2014. So do we split the account as of the 12/31/2014 value as that is the value as of 9/8/2015 (my preferred answer by the way) or do you reject the QDRO as not having a good enough description of how to split the account (the preferred answer of some of my co-workers at this ESOP specialized firm)? Like I said to many attorneys why wouldn't you give the date of the divorces as the date to value the account for the split? To an ESOP TPA that causes issues. An ESOP TPA will note this on a review every time. Even when I review a QDRO while I think my answer is good I note the issue in my review for the plan administrator to decide if they want to reject the QDRO or not. Back when I did 401(k) plans I found often times an attorney signed off on a QDRO only to have me start to ask really good questions that pointed out that the order isn't clear on earnings from the date of split to date of payment and I could go on. Once again read all the QDRO questions on the board and you see real quick a lot of practical issues get missed until the TPA is forced to deal with the QDRO.

Back to the original Department of Labor position, except that the Department said that it was impermissible to allocate the charge to the participant's account. The Department's recant only said that is was permissible to allocate to the participant. It did not say that treating the expense as a general expense of administration was improper.

How could an expense be allocated across the accounts of unrelated participants and still be a "reasonable" plan expense?