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Nope. When both employee and employer knows with reasonable certainty that the employee will continue to perform services for the employer, severance of employment has not actually occurred.

It amuses me that an employee thinks he/she has the authority to tell the employer what to do. Just my opinion: I suggest you search these Message Boards, using the word "sham" or "fraud".

You'll NEVER hear me object to it Rule number one, RTFD (Read The F...antastic Document)

This question might answer itself, but (as always) the first inquiry is "what does the plan say?"

You'll NEVER hear me object to it

Not to be too practical, but have there been any real problems resulting from failure to deliver "stuff," electronically or otherwise? How is mailing something, without a return receipt (and God forbid anyone is actually doing return receipts), or hand delivering without a signed receipt, and better than an email blast to all employees (without return receipt). Admittedly I don't deal with any plan that has 1000 participants, let alone 20,000, but I only see this becoming a real issue if there is some kind of pattern of secrecy and/or deceit. As nasty as the DOL can be, I don't see them dropping the hammer just because 5 participants' SARs got lost on a server.

ETA: Your thinking is correct and preferable. It is still possible to have a plan exclude the compensation through some combination of definition of compensation and employer characterization of the end of service. It is not always saying anything terribly interesting to remind about checking plan terms.

Unless the plan says otherwise.

As this conversation shows, the ERISA rule's application can be less than clear, and can be burdened by practical difficulties.

This is open to interpretation. I would continue to accept loan payments until the participant is actually paid out their plan balance due to the plan termination. The language in the loan program seems to address the issue that the plan will no longer be in existence to collect loan repayments. So, if you have 3 years left on your loan but must pay out all balances within 12 months of plan termination; then the plan will not remain open for purposes of collecting the loan payments. Hence, the loan must be due and payable. I wouldn't lose any sleep over continuing the loan until the balance is paid out. Good Luck!

Ideally, the reference to "set up procedures" in Post #3 is double-edged: - The external vendor should improve their procedures, and should identify those improvements to you (i.e., the plan sponsor), and - The sponsor should improve its own procedures (let's just call this "proofing").

I would be a little curious as to whether it was actually a single participant. Generally all assets in a fund are moved to a like fund (which we know). But was a single participant the only one invested in the affected fund?

This is a great question. I was one of the drafters of a comment letter on this topic a few years ago. The integral requirement was one of our arguments in favor of a an opt-out default rather than an opt-in default. There are very few jobs left that does not include some level of electronic communication, but there is no clear definition of when it is integral. In my opinion, two way communication is not required for it to be integral. If you are required to read email on a consistent basis, that is enough for it to be integral.

I agree with all of the above. Since I didn't see it mentioned above but the correction to the 3 people will have to include some kind of lost earnings in addition to the contribution. Once again someone at your service provider ought to be telling you this. However, as you can tell from the earliest comments you have a bigger problem then the 3 people. There is a systematic problem that allowed this to happen and not go detected for years. That systematic problem could cause larger issues with the IRS or DOL.

I always interpreted it as meaning that the employee had access to a computer, with email capabilities and an email address, because they needed to use that computer for work. Key here was the "need" for their job. As opposed to someone who may have access to a "community" computer at work.