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Peter, I can only say never underestimate the persuasiveness of investment salespersons.

If a plan is subject to mandatory auto enrollment, you have to satisfy all the requirements for MAE in S2.0.

Early withdrawal penalties on GICs, early redemption fees on mutual funds, and all flavors of contingent deferred sales charges, redemption fees and back-end loads come to mind. If your note about non-qualifying assets was meant to exclude responses about investments that would be non-qualifying assets unless they can be treated as qualifying assets under certain circumstances, then I agree that almost all such assets cannot be valued timely and do cause delays.

This may not be what you are asking for but plan can also have restrictions due to "day trading" or too many "roundtrips" (buy and sell in the same trading day) within a specified period. Trading funds in and out of a 401(k) every day does not violate the Code. However, plan administrators can place rules that can restrict the frequency of in-plan trades. Some fund sponsors frown on the practice. For example, excessive trading in and out of funds in a commission-free account without paying any sales loads on the funds may cause the sponsor or fund to absorb the cost of the frequent trading. Many have a rule like three roundtrips in the same fund within any rolling 90-day period or 10 roundtrips in the same fund within any 365-day period would be considered frequent trading and will result in the enforcement of the excessive trading policy causing the employee not to be able to trade that fund for a while. Some sponsors simply don't like it because they don't want their employees trading all day and not working. Not a charge but you asked about restrictions.

Yes, but to avoid the escalator, you may elect an initial percent of 10.

As with MANY inquiries from the sponsor/client/company, it's often best to ask questions, such as: Why do you want to do this? What is special about this situation? What is special about this person? There may be more than one way to solve a problem. Maybe I sound like a broken record, but I'm just asking you to act like a consultant.

Agree, but would hope in the modern world that those are non-existent or few and far between.

As with many answers in this forum, even if you CAN do something doesn't mean you SHOULD do it. Can they do this? Yes. Whether or not they should is an overall HR/employee relations issue that should be considered.

Don't forget that LTPTEs have to be auto-enrolled (absent affirmative election) if the client is subject to AE.

Im not sure I see the issue. Eligibility is 1 year. Employee does not meet regular eligibility. Employee does meet LTPTE requirement. Why would the employee not be considered an LTPTE?

The maybe notice can only be issued for a Safe Harbor Non-elective. There is no "maybe we'll match safe harbor" A Safe Harbor matching contribution can be discontinued mid-year by amending the plan to remove the match, providing 30 days advance notice of the discontinuation to the effected participants and making all matching contribution from BOY through the discontinuation in the notice. In either case a "maybe" SHNEC that is "no" or a discontinued mid year safe harbor match is not treated as a safe harbor plan for that year and is subject to ADP/ACP testing and does not get the "deemed not top-heavy" exemption if that is a concern. If the advisor is insisting they are correct, have them provide a citation but you'll be waiting a longtime to receive one.