I thought there was some guidance that zero compensation employees were not to be included in testing. That's the way I've been handling it for over 20 years working at a number of TPAs.
However, my new employer has a policy to include zero compensation participants in coverage testing (but not in ADP/ACP). We're having a substantial number of plans failing coverage as a result (even safe harbor contributions...). I'm kind of stuck because I have no access to our legal group and don't know whether this interpretation originated with them.
Is there any on-line resource that has some level of definitive guidance on the subject?
Thanks for any help you can provide.
